Is your business relationship ailing – or worse on its deathbed? Several of us on the Vested faculty were practitioners before joining the academic community, and we know that sinking feeling of having worked so hard to find the perfect partner only to see frustration kick-in is as that “partner” seems to forget all about leveraging each other’s core competencies—and simply hunkers down in classic What’s-in-it-for-Me (WIIFMe) behaviors.
Unfortunately, inherent flaws in conventional sourcing business models often cause “ailments” – or perverse incentives that can disrupt or even destroy a relationship. These ailments are analogous to a poison that spreads throughout the system leading to a serious ailment. In some cases, the ailment can simply cause negative side effects such as metrics that are misreported, under-reported or poorly understood by the parties. In these cases, companies and their service providers live openly with these infections and often battle the effects daily, simply learning how to live with them.
In other cases, the ailment lies hidden deeply within the relationship—and neither the company nor their service provider knows it’s there. At first, no physical signs of the ailment may be evident, but left unchecked it may fester into something bigger. In the worst cases, the problem can become so endemic that it eventually causes the death of the relationship, which leads the company to bring the outsourced services back in house or induces it to switch suppliers.
Our research exposed the 10 most common problems in business relationships, which we call the 10 Ailments.
The ailments are described in chapter 3 of our first book, Vested Outsourcing: Five Rules That Will Transform Outsourcing, now in its second edition. In it we profile many of the classic perverse incentives that creep into business relationships, and provide examples of each of the ailments in action. Bryan Jacobs, Jones Lang LaSalle’s real estate & facility management outsourcing expert specializing in multinational companies, says, “Chapter 3 should be mandatory reading for anyone in an outsourcing relationship. The ailments are real – and we need to continually keep them front and center and proactively seek to avoid them at all costs.”
In this blog series, we profile each of the 10 Ailments. Click through to read the ones that sound the most intriguing to learn more.
- Penny Wise and Pound Foolish
- The Outsourcing Paradox
- The Activity Trap
- The Junkyard Dog Factor
- The Honeymoon Effect
- The Zero-Sum Game
- Driving Blind Disease
- Measurement Minutiae
- The Power of Not Doing
So how can you tell if you are suffering from one or more of the 10 Ailments? We’ve provided a free online self-assessment, which will help you identify which of the ailments are impacting your business relationships, and how severely you may be experiencing that ailment.