Workers work, supervisors supervise and managers manage. It's a complex concept, apparently.

Management = asking questions. Ask questions. You've got all the tools. I think you know that this inexpensive-product source is costing you dearly. Mike is right in that modeling decisions, and reducing the variables to values you can compare, is terribly fruitful. Pain in the ass, but terribly fruitful. Quantify things like how important is this feature to you, or that feature. Just the process of asking those questions and placing values on those variables causes you to understand your business much better, and make deliberate decisions about inputs and outputs, etc. There will be surprizes and epiphanies. Sometimes the product itself is one of the lower-ranked criteria. And the price. Product price may be only weakly related to the value of that vendor's service to and relationship with your company. Often the higher priced product is cheaper and/or more effective for your company.

For example, I can offer you an opportunity to pay $1,000 per hour for advice. With Mike, you'd only be getting advice worth $700. (I'm joking)

I suggest a sit-down with the vendor's top guy(s) and explain how you feel about this situation. As odd as it seems I believe the two parties should discuss one-on-one the problems at hand. I would almost bet they (the Vendor) have some long-standing beef with your company as well.

At that point the situation is either resolved or not. If it isn't try to find another vendor while you continue to do business with the current one.


May sound too simple a solution but after the meeting you know exactly what to do next.

I love the face-to-face stuff. I used to think meetings were a colossal waste of time. Now, I think that's where stuff happens. As said above, by the end of the meeting you will know whether this vendor is going to work with you or not. And they will know whether to expect your future business or not.

I think face to face stuff allows one to get a feel for how the others do business and you can get an answer now. I have only been in the business world for a few years now but so many people hide behind their email, phones and faxes and make so many damn excuses. I am a straight forward person and if I don't like something or can't do something I will usually say something but carefully.

If you can meet with the vendors top people, you may be suprised at their answer and why they are behaving that way. This is a serious issue so asking them what they think may suprise them and catch them off guard.

The meeting should not be about blame but what it's going to take to resolve this.

Sebring77: Yep, labor costs, parts replacement and downtime are all my mantra! Most likely left it out of my rant becuase it is as common to my way of thinking as breathing.

Superman: I just increased my billable rate to $1200! We keep going and pretty soon we won't be able to justify our existance...

asphaltgambeler: a face to face is essential, gives you the chance to grab him by the collar and shake the ***** out of him!

Only AFTER he's signed the contract!!

Mike, I'm changing my rate to $2,000 per hour. Temporary sale price. By golly, they're going to appreciate me.

Also, I hear ya with regard to the costs. My line of work is not the same as yours but yeah, I'm interested. I've always noticed that businesses RARELY get anywhere near close to an accurate estimate of what certain decisions cost. And the cost in "time" (or "labor" or whatever you call it) has become astronomical, in my humble view. With today's business technologies, the amount of stuff one person is expected to do (or at least capable of doing) is breathtaking. If someone were to waste several hours "saving" money, and if we measure that person's value in terms of how many other problems they could have solved with that time, and how much those solved problems would improve costs or sales, then you can easily spend a thousand dollars to save a penny. Your wimpy fee is probably a screaming deal for all your clients.

Whilst it is great for you guys who consult to the large companies on how they can save money. I find it hard to accept that management in listed companies can have so little regards for my equity in the company.

Whilst I do not dispute the money the CEO's of large co's are paid I do believe that it should be largely performance based. So if they make a loss then hey no bonus.

My two cents.

Michael

$700-$2K an hour?? Man I hope someone gets a happy ending!

Mike H,

I think you should give me a job chasing up your outstanding debts I will only charge you 500/hour.

Michael

Supe: $2 large huh?, well well, this could go on unless someone changes the rules - alwsy been a fan of changing the rules so, now you have me considering partnership and possable profit sharing! I have come up with some unique concepts that track and provides metrics for capturing the direct and indirect cost pools. These actually can be tee-d up as vlaue added contributions at also get mixed into the frey and add to the ultimate savings.

Walko: Actually, small to mid-size companies are better targets, less BS and less levels to the top. Sometimes, you can be creative - I have actually gotten free goods and services in lue of $$$. It is an interesting approuch and maybe one step towards haveing much with out tendering cash.