Walmart Chopper: Day 1 Q&A

The last few posts really started burning the vlad@vladville.com inbox so here are some of the points I thought I should discuss in public. I always like hearing from people, please drop me a note if you’ve got something on your mind.

Vana: Am I next?
Yes, thank you for saving me an email and a phone call.

No, of course not. Really, out of the 20 people I talked to, not one of them was surprised. They knew things were not working out and for the most part we all agreed that parting ways was in the best interest of both organizations. Some relationships work, some don’t. Try to understand the nature of a problematic client. They are likely always on your radar or something is always demanding your attention. You are burning time trying to make them happy and getting nowhere.

As I said, 90% or more of our relationships are just perfect. People approach us or we approach them, we find a profitable relationship, stuff breaks, we fix it, they tell us what their clients need and we provide it, everyone in the equation makes more money, the conversations are pleasant (actually, the conversations are the BEST part of this business, I LOVE talking to my partners)

Dan: Are you afraid of the retribution?
I have to be honest, yes, I am. Whenever you upset people you have to be prepared for some blood in the streets to make you look like the devil.

However, the business case for a service termination is not an emotional fear of you missing out on some potential business down the road, the business case is optimizing the company so you are no longer demotivating your workforce and losing money. If you have to do this, don’t let the fear overcome you: It’s like saying you don’t want to go to the hospital for a cut because they might use painful stitches, so you sit on your ass until you bleed to death.

The negativity of having an unhappy client is far worse than the retribution after you’ve parted ways. What is worse, to have a few of your partners badmouth you on the forums all the time, or to just part ways and have them say you’re not friendly to ___ people?

Allen: What the heck is Walmart Chopper?
We come up with entertaining names that make us laugh about the stuff we are doing that are vague enough to be brought up in a conversation and don’t make anyone take themselves too seriously to lose perspective. I know this sounds amateurish but stick with me, I’m about to let you in on a big secret to motivating a cynical workforce. I could have called this “Vlad takes ten days to clear out ten years of mistakes by forcing us to focus on accounts regardless of if they are losing money” which just screams bad leadership. Or I could have titled it “Succession planning, strategic customer base realignment” which is what any “real” company would have done. But here is what happens when you put a serious title in front of people who try to be serious – they start providing “input” which is just another word for unwanted advice: “Well, if we are working out a succession plan should we not also do ___” and you spend more time in meetings deciding what you’re about to do than actually doing it. This is why most meetings end in a stalemate and agreement to meet about it again – I choose to set the agenda and spend more time measuring the actions because thats where you find the faults in what you are about to do, not brainstorming all the possible things you could do.

We make a decision, set the parameters, do, measure, do, measure, do, measure and then if something needs to be changed we’ll look at it when we’re done. Works for us.

Eric: Why is this not a daily/weekly/monthly/yearly chore?
As I tried to explain, this is a seriously draining exercise and your client base should not be dismissed on a whim, or the second their P/L dips below 1.0, or their credit card is declined. If you do that you are clearly all about money and you will have 0 loyalty from your partner base if you behave in such a way. Works for monopolies, cable companies, etc. But for a rapidly growing company, in a high tech market, with a ton of substitutes you need to show a bit of leniency.

I am not saying that one should be careless and just let things slide, but imagine what message you are sending if you’re just randomly kicking people out because you don’t like them or they aren’t profitable at this moment? People are difficult. Making money takes hard work. Getting clients and partners is tough business. Keeping your existing client base happy, or turning an unprofitable client to a profitable client is possible. Just don’t rush.

What I am saying is that you need to have a pattern. You need to have tried to fix/salvage the operation. Only when you’ve failed at that, when you feel that both organizations would be better off do you move to part ways.

Dan: Should this not be done from the start of problems?
Yes, if I had a crystal ball and knew every lead personally, checked their credit, got brought into their board meeting (or sat in their car while they called their Visa to check the balance) or… you get the picture.

Some clients you can tell from the moment you talk to them that they are not going to work out. I have not had a problem with that, I happen to be brutally honest (those that have met me will vouch for that) about all the options so I know that the people that choose to work with us know the very worst of what may happen. I believe my job as the CEO of this company is to explain my business model to my partners, understand theirs, and find profitable opportunities. It is not to cram stuff down their throat and sell them the dream, I want my partners to be around for a while, not sign a perpetual payoff contract for 1,000 seats or invest $18,000 in my software and vanish.

But, over the course of business, things change. Business objectives change and the partner stops training their people, floods us with support calls and makes training of their staff our problem. Management changes, and you get to deal with someone that you really can’t work with and make a positive relationship. Budget allocations shift, people cannot afford all the services they subscribed to and require for their business operation and they complain to you about the software not meeting their needs. The list goes on.

Natural part of business is change, those who embrace it are called leaders, those that sit back and hope for the best are called employees. You do not have 100% vision of the future and at times you need to react after the fact.

Bob: I assume you are clearing shop for something, is it more Shockey Monkey?
No, the primary objective behind this was to make sure that when I take my leave we are not left with the same problems that overwhelm me today. We happen to have some room for a few weeks before things really ramp up for the summer and I made a decision to optimize the business now instead to act on a whim later.

This was not tied to a particular product, plan or anything else.

Day 1? What happens on day 2?
Vlad creates the sky 🙂