Sep 162021

Free conference passports are just the beginning. “Normally, you get something out of it,” says Mark Gulling, CIO of Eastman Kodak, who got free advice and a discount from SAP as a reference. He won`t give details, but says the discount is minimal and benefits his Rochester, N.Y.-based employer, not him. “[Suppliers] understand that it takes time for you to do it, but that`s not why you do it,” he says. “There are contacts that I can come back to later and talk to them.” The government could do something. The benefits that companies derive from being benchmarks for suppliers may no longer justify the risks, both personal and company-wide, that are part of the package. In fact, the only valid reason to accept a referral for a supplier may turn out to be the simplest of all: because you think it`s good. It`s worth taking the time to understand this relationship. In some cases, a company can establish such a strong bond with a supplier that the company becomes a little more of a customer if a little less of a partner. But you have to dig to find out for yourself? Suppliers will not spell it out for you.

STATE-owned enterprises can drive innovation from a demand perspective by acting as technologically demanding customers who purchase the development and experimentation of new solutions. This allows European authorities to modernise public services more quickly and create opportunities for European companies to play an international leadership role in new markets. Creating a strong European market for innovative products and services is an important step towards creating growth and jobs in rapidly developing markets, such as ICT. These lighthouses can help suppliers gain legitimacy, sell products, and build shareholder confidence by proving that the seller has a consistent paycheck from a company with deep, well-built pockets. But they can also break their suppliers by talking about a project and then pulling out. Last February, for example, reported that Manugistics` stock price fell 18.5 percent after a research analyst said one of Manugistics` flagship customers, Ford Motor, had frozen some IT projects. Raj Rajaji, Chief Financial Officer of Manugistics, had to assure nervous investors that Lloyd Hansen, Ford`s vice president of revenue management, would speak at an upcoming user conference, proving that the partnership was still strong. Pre-Commercial Procurement (PCP) challenges the industry on the demand side to develop innovative solutions to the needs of the public sector and offers a first customer reference that allows companies to create competitive advantages in the market. The PCP allows audiences to compare other potential solutions and filter out the best possible solutions that the market can provide to meet public needs. So what can CIOs accept from an ethical point of view in return for the fact that they serve as a reference? Ideally, nothing, Koehn says.

“If the seller`s products are good, the customer should be willing to make a free recommendation for that supplier, right?” she asks. “The question is, why does the customer feel entitled to claim some kind of compensation, or why does the seller need to offer some kind of compensation?” “If a customer isn`t willing to be transparent [about rewards], then the conclusion that a non-interest-free party might draw is that the person has been bought,” says Daryl Koehn, director of the Center for Economic Ethics at St. Thomas University in Houston. A reference may sound good, but it is rarely an accurate representation of reality. Companies that agree to serve as references are self-selected and satisfied customers who have a personal interest in the supplier leading a long productive life. “You want your vendor to succeed and gain resources and influence so they can improve their software,” says Wendy Close, an analyst for Gartner in Stamford, Connecticut. . . .

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