Know your opponent. That’s the advice that one industry pundit offered to financial institutions in a recent opinion piece about negotiating pricing with technology companies.
Know your opponent.
I’m not going to lie. When I first read that, it made my stomach churn a little. Then it just made me angry. Why? Because that’s about the worst advice ever – and I mean ever.
Know your opponent.
That encourages financial institutions to create and maintain an adversarial relationship with their technology vendors. That’s so fricking stupid, it boggles my mind.
Here’s a newsflash for all you banks and credit unions out there: Your technology vendors are not your enemies. They’re actually your friends. Or at least they should be. They want the exact same thing you want – for you to be successful using their products and services. You’re both on the same side.
Sure, every vendor needs to turn a buck. On the credit union side, even CUSOs need to make enough money to pay the bills, grow the business and offer some sort of return to their owner credit unions. That’s just how the world works. Providing great technology can be expensive these days. So don’t be surprised that you need to pay your fair share.
Am I saying there are no unscrupulous vendors out there? Of course not. I could rattle off a short list right now. Am I saying you shouldn’t negotiate pricing? Hardly. It only makes sense to get the best pricing you possibly can. All I’m saying is, you’re only hurting your own institution if you view every vendor as your opponent.
You’ve been there in a restaurant when some customer decides, for no apparent reason, to show the whole joint just how big an a-hole he can be. You know, the guy who thinks he’s better than the people waiting on him, and doesn’t want them to forget it. And you remember thinking to yourself, damn, somebody’s gonna spit in that guy’s French onion soup. You don’t want to be the guy who encourages your vendors to spit in your technology soup, do you?
I’ve talked to vendors many, many times over the years about the need to establish a real personal relationship with each customer. I’ve been in this industry nearly 30 years and that’s the only way I’ve ever seen business move forward. However, it takes a customer at the other end that’s equally willing to nurture this relationship. It works both ways. It has to.
As I said earlier, your technology vendors want what you want. And the good ones are willing to do whatever they can to help you get there. When it all works, it’s a beautiful thing.
You achieve the success you were looking for. As a result, you become a brand advocate for the vendor. The vendor leverages you as a reference, helping them attract more customers, which in turn further protects your technology investment. As a result, the vendor shows you preferential treatment, enabling you to be even more successful. And the cycle repeats itself in endless glory.
None of that happens, however, if you treat every vendor as an adversary. Instead, you’ll just end up with mediocre technology, wondering why your French onion soup tastes funny.