Settling Superiority of Customer Vendor Relationship
Customer Vendor Relationship
As a project manager, we are working for someone and we are taking service of someone. So, we are customer and vendor both. We hear from our seniors, elders, and society that a “customer is a god“. In some other cultures, we say a “customer is king“. Because God or King is superior to humans, so this Customer Vendor Superiority question comes to our mind.
In 2013 through a common friend, I met few Indian Government officers (IAS) in Dehradun and I asked how do you manage your projects? How our Administrators are equipped with project management best practices? What is the content outline of their project management training? In 2+ hours of meeting with different officers, they shared some of the ideas. In nutshell, they mentioned that we have some modules of project management during our training that but in real life that knowledge does not work. In government projects, we have many vendors and stakeholders and it is extremely difficult to manage all and deliver the project successfully. In real life vendors are totally different they want to maximize their profit without doing quality work. So being in government we have simple logic that we are customer and service or product supplier is our vendor. So, to manage the project successfully we should design contracts very carefully in our favor. Now during the project if we find things are not going as per contract then we give them the reminders and finally if they do not work, then we always have the upper hand because of two reasons A- we are part of the government, B- we are the customer. So we can pull these vendors in the court and make him straight there. We are well-trained and well-networked people, we know IPC (Indian Panel Code) and CrPC (Code of Criminal Procedure) so it is easier for us to get these people on track.
I was not much surprised after listening to this answer because I have seen this kind of attitude of the customer towards vendors in my typical corporate life too. But I was surprised at the arrogance of officers in our administrative services. They think power is in their hand, therefore, anything can be done. I was thinking from where is this superiority complex has come in our tradition that customer is god or customer is king and a vendor is nothing, they are greedy people, their arm can be twisted as we want because they want business!
I was thinking that even after we pull our vendor into court, fight the case with them up to the highest court in the country and win the court case, even then we lose it finally. My experience says that in project management once you are forced to go in the courts then even after you win you do not gain much. Because, time, cost, scope, and quality are the primary objectives of the project and due to court war you have to compromise at least one or sometimes all of these objectives. So, what should we do? Should we let the vendor go and let him do whatever he wants? No. But manage your project with the right attitude!
Who is a customer? One gives money. Who is a vendor? One who gives products or services. Both are giving something to each other. Both are the giver. They exchange their things after the negotiation. In the negotiation, objectives are two folds.
A: The value of the product or services for which the customer pay should be equal to the price which the customer is paying. Keep in mind price can be measured but the value is felt.
B- The value of the money for which the vendor delivers a product/service should be equal to the cost of product + profit.
So, here is the revised definition of customer and vendor. One who has one thing (currency) to offer is a customer and one who has many things (product or services) to offer in exchange for currency is a vendor. How come the customer is king or superior or god? In India, we avoid using the word god but we prefer to use the word Devata.
Devata is a Sanskrit word driven from the Sanskrit root Dru. The meaning of this is to give. So a giver is a Devata. One who fulfills the desires by giving us the objects of our need is Devata. But keep in mind that Devata does not give to anybody without any reason. We need to pray for it. So when humans pray to the Devata then Devata fulfills the desire of humans. Here human has only one thing to offer and that is Bhakti (respect, love, prayer, singing his glory or doing Yagya – different name or form of the same thing). But Devata has many objects of your desire to offer to you. By this logic, a human is a customer, a giver of one thing, and Devata is a vendor, a giver of many things. Who is superior? None! There is a mutual dependency between customer and vendor. If we respect this Human-Devata relationship and the customer knows that I am a human and my vendor is my Devata then many of the problems will be solved automatically.
Why do I think many problems will be solved? I do not have any research results with me but my belief says that even after many prayers all human desires are not fulfilled by Devatas but there is less dissatisfaction among human and devata relationship. But in a customer-vendor relationship, there is huge dissatisfaction, doubt, and mistrust upon each other. So I feel if we change the attitude and work in good faith with this attitude of mutual respect then the project success rate can be influenced significantly with lots of positive energy in a project environment.
Like many vendors, there are many kinds of Devatas who offer various kinds of things to us on our prayer. But this human-devata relation survives only on Shraddha (closest English word is faith) and mutual respect. Similar customer-vendor relationship survives only on this Shraddha & mutual respect.
Instead of trying to play defensive or in attack mode through our contract negotiation if we focus on developing processes and practices which can harness the culture of mutual respect then working with vendors will be easy. With more sophisticated, technologies, processes, and open market economy customers and vendors know enough about each other, there is nothing much to hide. By virtue of this information, we try to play smart over each other, which we are! But is this smartness the solution to work harmony or healthy relations? This is the question which every project manager, either the customer side or the vendor side needs to ask themselves.