April 17th, 2009
Ugly enterprise software sales tactics
Forrester analyst, Ray Wang, describes three tactics enterprise software vendors sometimes employ to pull more cash from customer pockets:
- Forcing clients to spend more to keep a low rate for maintenance
- Selling additional products that have no future road map because of post acquisition road maps
- Suggesting additional consulting services that require additional product purchases
THE PROJECT FAILURES ANALYSIS
The first point doesn’t seem particularly heinous to me, although I suspect Ray would disagree. After all, every business uses volume discounts, and why should enterprise software companies be different? Some folks, such as ZDNet colleague Dennis Howlett, have raised fervor over what he calls the “empty calories” of expensive software maintenance, but I view that as a separate, although certainly related, issue. In this case, I’m strictly referring to the volume discount issue.
The second tactic, selling dead-end products, is nasty indeed. I believe selling useless licenses to locked-in customers crosses the line of unethical behavior. Sales people who perpetuate this crap should lose their job.
Finally, on up-selling consulting services, again I don’t think this rises to the level of horrible crime that Ray suggests. Yes, the approach is hardball, but again, every business tries to up-sell. To be clear, I’m not condoning strong-arm tactics, however, this nonsense is not in the same league other sleazy enterprise software sales tricks.
In fairness, it’s also important to recognize Ray’s bias. Although he’s one of the most knowledgeable, diligent enterprise analysts out there, Ray’s role is to protect his clients, and he does benefit from negative press about vendors.
That said, technology vendors sometimes make themselves easy targets and Ray’s points (and the stories in his post) are entirely plausible.
Michael Krigsman is CEO of Asuret, Inc., a software and consulting company dedicated to reducing software implementation failures. Click here to discuss this post with him on Twitter. See his full profile and disclosure of his industry affiliations.
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| 04/17/09
