Recap: Tony Smith was torn. A multimillion-dollar contract was at stake. As VP of marketing for the fledgling Targeted Outreach, his charge was to help grow the company—but his gut felt he was walking the ethical line. Global Air sales rep Amanda Heath had wowed Global Air Marketing SVP Ben Zeba with Targeted Outreach’s capabilities—so much so that the provider was on Zeba’s short list. In fact, he asked Heath to run a test: send an email campaign to about 1 million Global Air customers in an hour. Because Targeted Outreach was a startup and still ramping up its server capacity, the only way to do the test successfully was to not use the company’s email servers for anything else during that time. So, technically, the test results might meet Zeba’s expectations, but only by stopping other work. It would be at least six months before Targeted Outreach had the technology in place to meet Global Air’s requisite capacity on the ongoing basis that Zeba needed. In the meantime, Targeted Outreach would be conducting constant workarounds to achieve all its clients’ service-level agreements. Heath planned to run the test anyway; figuring that the team could pull off the test and, should Targeted Outreach get the contract, handle the temporary workarounds. Smith, however, felt this went beyond overpromising and bordered on fraud—especially if Targeted Outreach fell behind in its expansion plans. Should he call out Heath to the sales VP or CEO, cross his fingers and let things proceed, or is there another solution?
September Winner ? Mark F. Jenkins, Information Analyst, Cheryl & Co.
Smith may be torn, but handled correctly this situation is all about opportunity for Targeted Outreach. Yes, there’s an element of sales-overpromise here, but he shouldn’t throw a sales rep under the bus who has the proven ability to land opportunities like Global Air. He needs to have three scenarios put together by his tech staff, the “safe route” (from tech’s perspective), the “full throttle,” and something somewhere in between that is beyond the tech comfort zone but less than full throttle; and have an earnest and frank meeting with Global Air’s SVP Zeba, including Heath. Smith should set customer expectations by noting Targeted Outreach’s current and projected capabilities, show Zeba his three scenarios, and be prepared to bargain.
He could suggest that Global run a portion of its test volume through Targeted Outreach and another portion through its current provider and offer to ramp up from that level. It may be a challenge for Targeted Outreach, but it offers a better chance of engaging Global without turning their backs on Targeted’s other customers. He may even want to sweeten the deal by encouraging Global’s input on desired features and capabilities; marketing departments love responsive and flexible service providers.
If this works out, Targeted has landed a major contract and a potentially fruitful working partnership that will both drive and fund the startup’s development—without losing the sharp sales rep who managed to open up the opportunity.
? Lawrence A. Tillinger, proprietor, SFLI
Marketing VP Smith should, in a meeting with the CEO, the CIO, the CTO, and the sales VP, advocate outsourcing on a permanent basis Targeted Outreach’s email servers to the cloud.
Targeted Outreach would be able to complete the test successfully, and at the same time meet all clients’ requirements, by having infrastructure as a service (IaaS).
If Targeted Outreach rises to the top of “Global Air SVP…Zeba’s short list” to get the contract, it would be able to provide excellent service to its current clients, and any new ones, after getting Global Air using IaaS.
? David Saef, EVP, Strategy & MarketWorks, GES
There should be two meetings: the first to discuss the specific request, and then a second meeting to discuss how to improve sales training/guidance to avoid these potential issues.
First, Smith should call a meeting with Heath and the head of sales to discuss the situation. The intent should be to proceed with the test email. However, the three need to meet with the technical folks to solve the following:
- How will Targeted Outreach execute the Global Air test? Which outside company’s servers would Target Outreach use? Is there enough faith in that outside provider?
- What are the specific workarounds required for other client work? What would be the potential operational impact and impact to client expectations?
- What is the potential financial risk from Targeted Outreach underperforming on other contracts?
- What steps can Targeted take to mitigate the performance risks with other clients and with Global Air? Should it hire temporary staff to support the workload and secure additional service capacity? The team needs to review current commitments and see if schedules can be altered to meet the firm’s commitments.
By discussing the situation, the team can reach a consensus whether and how to proceed.
Then a second meeting should take place between Smith and the sales VP to discuss Heath’s meeting with Global Air. Key areas to discuss include whether the sales VP was aware of the meeting with Global Air and discussed Heath’s approach, as well as the idea of extending a commitment for a test. If the sales VP was not aware of the meeting, Smith should raise the issue of a salesperson making a commitment without consulting internal resources first. Yes, we all like to please people—but placing the firm at risk with current clients to try and secure a new prospect who has already indicated they’re developing a short list is not well thought out.
Smith should then work with the sales VP to provide guidance on types of tests the firm can reasonably offer, as well as a caveat that a salesperson can hear a request for a more ambitious test, but cannot agree outright without consulting with their colleagues to ensure that the firm can support the test with the right resources and commitment.
The issues should be escalated to the CEO in the event the team cannot arrive at a consensus of action from both meetings.
? Derek Harding, managing director, Javelin Labs
On one level this is the kind of challenge many startups face; however, the challenge as stated is false enough to make it hard to really consider. For sure, a small startup may have difficulty hitting one million messages in an hour (though really it’s not hard to do these days). What’s much harder to understand though is that it will take six months to have the technology in place. This sounds like a 10-year-old problem. These days it should be easily achieved in a matter of weeks, if not days.
If I were to be blasé about it, therefore, I’d say ‘Go ahead and do it while simultaneously firing your CTO and hiring someone competent.’
If everything is as stated, my vote is with Heath. Do the test, implement the workarounds to meet the client SLA until you can do it without workarounds. So long as you’re confident of meeting the SLA you are not overpromising or committing fraud.