Welcome back to the sixth and final installment in a series of case studies designed to test hypotheses I have regarding how supplier size needs to be factored into sourcing and supplier management approaches.
I’ve saved this case study for last because it is my favorite. This experiment is one more element of proof that what we at Next Level Purchasing teach is not just theory. If you don’t avoid the mistakes that we teach you to avoid, the results are predictably poor.
So this summer, we put the finishing touches on the new SPSM Certification & Enhanced Results Program. This program was an additional alternative to the standard SPSM Certification Program that we introduced on July 1, 2004.
The cornerstone of the SPSM Certification & Enhanced Results Program is the SPSM Multimedia Study & Implementation Guide. Unlike old-school certification study guides which are boring 400-page manuals, the SPSM Multimedia Study & Implementation Guide is an iPod filled with over 50 video and audio clips designed to help students pass the SPSM Exam and implement what they’ve learned in the workplace for better results.
We decided to launch the program on October 1, 2007. The primary way we would communicate this launch was via the list for our email newsletter, which is comprised of over 60,000 opt-in subscribers.
We also thought that it might be fun to do a little PR, though we had low expectations for getting any type of coverage. That presented itself as good opportunity to continue our supplier case study experiment.
I had met an independent PR person with her own firm – Cherry Communications – through an online marketing forum. We had exchanged emails in the past and I had been a subscriber to her PR newsletter and she seemed knowledgeable about the field.
Shannon Cherry presented a standard scope of work and a price. The scope was:
Days 1-7: Craft first draft of press release
Days 8-13: Discuss release
Days 14-15: Revise release, if needed
Days 16-28: Distribute release starting with bloggers, then magazines, then newspapers
Day 20 til launch: Follow up phone calls (3 hours worth)
The price was 3 monthly payments of $300 each or $799 up front.
OK. So let’s treat this like the typical tactical purchasing department. Small dollar purchases don’t require competitive bidding, so let’s not evaluate any other options in the market. Hey, if I pay up front, I’ll save over $100. This is easy, right?
So we selected Cherry Communications for this project and paid up front.
The project actually started well. Cherry Communications worked with us on a fine press release.
But that is where the good work ended. My gut instinct was right on the money.
I don’t know if Shannon Cherry thought that I didn’t have contacts in the media or what, but as I contacted some of my blogger, journalist, and editor friends, I found that none of them – NOT ONE – had as much as received a press release from Cherry Communications much less a phone call. I confronted Shannon Cherry about this and she said she was behind but all of the media contacts we agreed to would be contacted within days.
Again, none of them had heard from Cherry Communications. And I started having trouble reaching Shannon Cherry.
Interestingly, Shannon Cherry writes a blog called Mommy, Inc. I thought that I’d check on it during this time. Maybe she was ill or injured and couldn’t work.
But, sure enough, the blog was being updated just about daily. Sadly, those posts were about things that, to me, were far less important than Next Level Purchasing’s paid project: a jambalaya recipe and Britney Spears’ performance at the VMA’s.
So October 1, 2007 arrived. Thanks only to my own conversations with Michael over at the Sourcing Innovation blog, he posted a last-minute blurb about the launch. But in terms of PR, that was about it.
Of course, I confronted Shannon Cherry about this to see what she would say. She offered to refund $300 and would provide records of the phone calls she made.
I didn’t necessarily think that this was a sufficient percentage of the total – especially because I expect to pay for results, not a supplier’s time – but for the sake of this experiment, I accepted the offer. Shannon Cherry said that she would apply a credit to my credit card.
Yet, I never had a refund posted to my card. Nor did I receive any phone records.
With credit cards, getting your money back from ripoff artists is pretty easy. You just file a dispute with your credit card company.
But that doesn’t really help others avoid getting snookered. The Better Business Bureau is a great free service that purchasers (both C2B and B2B) can use to learn about shady businesses and to mediate disputes.
So I filed a complaint with the BBB. Interestingly, Cherry Communications was already listed in their database with an unsatisfactory record due to not responding to complaints!
Of course, if Cherry Communications doesn’t respond to the complaint (which I don’t expect them to do), I’ll have the credit card dispute option.
One of the most hilarious aspects of this experience was Shannon Cherry’s October 9, 2007 newsletter. She always starts out her newsletters with a blurb about her personal life.
She talked about being how she recently started a (free) podcast and she was transferring her (free) blog to a new server and she became a contributor to b5media’s (free) blog, etc. Should a company really be investing their resources in free offerings when they can’t serve their paying clients? Perhaps Cherry Communications is more of a hobby than a business.
So Next Level Purchasing students: did you see the purchasing principles that were violated in this experiment?
OK. So that concludes the series of case studies. In the near future on this blog and in PurchTips, I’ll be summarizing the guidelines that these case studies demonstrated/violated.
To Your Career,
Charles Dominick, SPSM
President and Chief Procurement Officer
Next Level Purchasing, Inc.
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