Page 198 - Executive Warfare

EXECUTIVE W ARF ARE

probably standing on solid ground. For example, at some point in my
career, the divisions I was overseeing needed a lot of printing. There was
a printing company we had a long relationship with. Let’s call the owner
Kevin. He knew the big bosses well and had been doing everything for us
for a dozen years.
The thing about printing, though, is that you can reject the product if
it’s no good. So quality is not the deciding factor—price is. I decided to
put our printing work out for bids for the first time.
Kevin was outraged and instantly went to the two big bosses to ask how
we could even question the relationship, especially since he hadn’t raised
his prices in three years.
“This isn’t about the relationship,” I said to the powers that be. “Actu-
ally, Kevin’s company is excellent, one of the best around. But there are
other good printers, and we have never bid out the contract, even though
it’s millions of dollars of company
money every year.”
IT’S STUPID TO
When it comes to price-driven con-
DISLIKE AN
tracts, the top of the house will always
EXISTING VENDOR
let you bid them out because they’re
SIMPLY BECAUSE
afraid of being accused of favoritism.
HE OR SHE HAS
Now that there was an open compe-
BEEN AROUND
tition, Kevin lowered his rates and still
AWHILE.
came out the highest by far! What had
happened over the years was that he had
goosed up his prices and goosed up his prices and stopped only when he
was making a fortune. Meanwhile, inside the house, it had always been
taken for granted that Kevin was untouchable.
Well, we hired somebody else, and when we next bid out the contract,
Kevin was again too expensive. Eventually, he stopped socializing with the
bosses and ceased to be a problem.
Commodities peddlers like Kevin are much easier to handle than what
I would call the subjective vendors—the accountants, the lawyers, the IT

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