Vendor Trust – Where has it gone?


In the course of wide ranging CIO discussion in the last few weeks around the region, and across topics from Information Management to Infrastructure Management, one thing that is appearing to be an increasingly significant problem is a decrease in trust that enterprises have towards their vendor.

Quite simply, the CIO is struggling to consistently trust their vendor/s. Clearly it would be incorrect to assert that all relationships between vendors and enterprises were lacking in trust but it is an increasing trend. It is an equally disturbing issue for both parties. The ultimate outcome of the lack of trust is too much time is spent with lawyers and contract and potential of an end to the relationship. Not enough time is spent on mutual innovation and development of suitable outcomes by vendors for all.

Why has the trust disappeared?

There are several reasons. Clearly with the size and complexity of engagements between large vendors and large IT firms makes intimate relationships more difficult to realise.  As a result, relationships get stuck in a transactional and contractual focus rather than the more desired, but much clichéd relationship. It has come about through vendors overstating capabilities, and to be fair, enterprises also having misplaced expectations.

Smaller vendors and channel suffer less from trust issues, it is still a problem especially with smaller enterprises dealing with larger vendors. In many ways it can be more crippling for the enterprise as they have to allocate time and money to work around the trust issue.

Cloud investments and the related chest beating in recent times is also not going to improve the situation. Enterprises want real outcomes and real capabilities. They readily spot a dodgy re-painted offering that becomes cloud overnight. This undermines trust. Genuine cloud offerings will build trust. Rebadged offerings will continue to undermine trust.

Vendors need to identify situations where they have compromised the trust of their customers. Pro-activity is essential. If trust issues are not managed then the client may not walk due to the cost of changing providers. But when the next contract comes, the depth of trust and relationship will be real and measured quite quickly for all to see.

As the CIO of a global steel products manufacturer told me last week, “I just want to be able to trust my vendor has my best interests in focus most of the time …. Mutual trust makes our journey to the cloud simply easier”

About capioIT - Phil Hassey

capioIT is an advisory firm focused on helping organisations to understand emerging technology in emerging markets. CEO Phil Hassey established the company in 2010
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