The long-term effects of trying to save the company a few bucks in a shady manner can backfire against a project manager in a big way.


I was speaking with a friend in technology sales this week. He was describing a situation that I found appalling. I know this happens more than this isolated incident so I thought it worthy of a post.

The partner for this company was providing a phone system. They swapped out an old PBX system for a VoIP system. Once it was implemented, they found that one remote area of the company had a requirement for an intercom capability. It was not in the scope of work and there was no budget for the added feature, but there was a huge event that needed to be serviced using this intercom service.

So the partner, being a partner, put a 10-day demo license of the intercom module on the system to get them through the event. It was communicated that this was a demo license and that they should really consider licensing the product at a discount before the next event six months later.

Well, nothing happened. Six months later another event was gearing up to kick off. The same project manager who managed the implementation and was aware of the demo license called the partner to task saying that the phone system was an utter failure and put the intercom functionality as the main reason arguing that it was always in scope. Basically, he was trying to get it for free.

Do you think that this partner wants to continue to be a partner? Not now he doesn’t. I won’t suggest that this partner turned vendor will provide lower quality service, but what will happen is:

  1. Projects will be over-documented and additional administrative resources will be required for any project so they can make sure that their CYA documentation is in order. Change orders and project scope will be meticulous and they will deliver exactly what’s on paper and nothing more.
  2. Discounts that a true partner is entitled to because of a certain level of predictability in a revenue stream will evaporate. If they can’t be confident that the work will be there, why discount that up front?
  3. Trust is gone. There is no real chance to incorporate this partner into your team and count on him like a team member.

Now let’s look at what happens to this project manager. The partner starts having conversations with his friends, usually also in technology, about the situation at the former partner’s place of business. Because they are friends, names are named. After all, that’s how I found out about it. The whole paradigm about network comes into play. Depending on the severity of the situation (a direct measure of how interesting the topic would be in any conversation), they tell two friends and then they tell two friends…etc.

If that project manager ever looks for another job in the area, good luck. There are the references the employee will put on the resume and then there are the references that are “within the network.” Additionally, other vendors that work with this former partner may become aware of this behavior as well. All in all, the long-term effects of trying to save the company a few bucks in this shady manner can backfire in a big way. Upfront dealings are the only way to have any long term success doing business.