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Yea, at my F500 sized company we set budgets year(s) in advance. I literally have a line item (that gets reviewed monthly!) for each major SAAS product my team
by mox1 4y ago
Yea, at my F500 sized company we set budgets year(s) in advance. I literally have a line item (that gets reviewed monthly!) for each major SAAS product my team uses. We estimate like a 5% inflation YoY into these budgets.
If a vendor purposefully under-quoted / undersold me and then asked me to pay more $$ 6 months in, I literally couldn't do that if I wanted to.
- Rastonbury 4y agoExpansion and addons are really common though, the stakeholder has to push for more budget, not too difficult if the product really drives business value
- jjk166 4y agoThere's a big difference between compounding past success and ameliorating past shortcomings. If implementing some improvement goes well, we accomplish our goals on time and within budget, it's easy to say let's do it again. If a vendor makes me go in front of my boss and say the budget I previously requested was not sufficient and the thing I said would get done wasn't, I will never stake my professional reputation on that vendor again.
- Closi 4y agoThis isn't about selling customers what they need, then discovering new value through addon's though. The article is quite clear that it is intentionally selling a customer less than what they need in order to get them to buy what they actually need later down the line, once they are already committed. As a simple example, I could sell you a 3-year software license agreement with a 60 day estimated implementation program on a T&M basis. Then after you have signed the software agreement and are committed to licencing we go into blueprinting, I could suddenly say that it's actualy 120 days implementation now, and that will net the vendor an extra $90k revenue in Y1. Then after implementation you realise that you didn't buy the 'Bi-Connector' that was demo'd to you during the sales process because "oh that's actually another license" even though they clearly showed it as core functionality in their demo.
- Foobar8568 4y agoI am dealing with such in different clients, fuck them, fuck these people. Even worse, you are taken hostage to their sales team,what can you do? Break the contract? Penalties when you barely have a working solution? Bring the legal team? Yeah sure, good luck to have anything completed.
- jehb 4y agoCame here to say this. I'm sure there are situations where this strategy may work, but where I've worked (which is primarily outside of line of business operations) budgets can be inflexible in the short term and just as often trend downward as upward. And people move on. Just because you developed a business justification with my the person who owned a budget before me doesn't mean I'm going to identify that need as a business priority, particularly if my first interaction with understanding that piece of our operations is that it requires a ballooning cost allocation.
- aaaaaaaaata 4y agoDo you have a discretionary budget?
- mox1 4y agoYes, but I wouldn't be allowed (or I would be questioned) why I wanted to use that budget on this addon/upcharge. We can always fight to get more $$ (there's always money in the banana stand!), but I do have to put myself on the line to do it, justify the need, etc. I would never do that for a vendor 6 months into a new relationship.
- Mandatum 4y agoThat’s why we usually tie you into a 2 year contract with review points for expansion and adjustments, with looots of discounts up front. By year 5 you’re paying sticker price and paying our consultants for integration and Enterprise feature configuration.