Take a Number

"Our #1 priority is YOU!" This is the slogan of a trucking company here in the Western United States. Of course the slogan only makes sense if the company has only one customer. While the irony of the slogan seems intuitive, many project managers fail to comprehend the importance of the truism when dealing with their vendors, and they deceive themselves by imagining that they really are #1.

Underperforming vendors are a frequent source of trouble for project managers. When repeated phone calls fail to remedy the situation, more drastic measures are called for. Of the many management books available, a number have specific advice for improving results. Most recommend planning a visit to the vendor's site. The visit should be led by a higher level manager to let the vendor know how critical his performance is. The visiting group will impress upon the vendor his importance as a member of the team, and the vital need for him to improve.
Does this technique work? The answer to this question requires us to understand three things. First, the vendor does not want to be on any one's team. He wants to get paid. Second, he is resource locked. Either he doesn't have enough equipment, enough capital, or enough people to get the job done on time. Third, the vendor does have other customers. Game theory teaches us that your opponent gets to make a countermove. We can extend this tenet to our current situation and posit that the vendor's other customers get to make a countermove.

So let's get back to the question, does the Big Meeting yield results? Maybe the meeting causes the vendor to speed up work on the manager's project. But to do this, he must move resources away from other customer's projects. Now we see the countermove. Perhaps this causes the other customers to plan their own Big Meetings. So they use a similar technique with the high level manager, the team speech, and appeal for better performance. But remember, the vendor only wants to get paid. And the only thing he really hears during these meetings is the implicit threat that the business will be pulled from him. If he can make short term changes to keep all of his customers hanging by a thread, that will likely seem to him the best choice. He can't be on every one's team. He acts in his self-interest.

In the end, we have the classic squeaky wheel and grease story. The vendor shuffles resources to balance the threat of losing the business of each of his customers. His customers think they are managing, when all they are really doing is competing with other customers based on a cold calculation made by the vendor of the minimum resources that must be committed to keep an individual customer's business.