The short answer is YES! However, it’s not who you think….
Firstly, singling out IBM is unfair, their name has become a proxy for all big, complex, solution providers. IBM is a great institution and if you work with the federal government in anything to do with security you might well get fired for not using IBM! So I won’t mention them again….the discussion point here is the big brand name, the default, the go to, the “Hoover” of whatever you are looking to do.
What are some of the factors that might drive the decision-making process down the path of the big name provider?
FUD - Fear, Uncertainty and Doubt
This is the leading factor and underpins the “nobody got fired for hiring IBM” statement. People are scared that going with a less mainstream choice if they are the decisionmaker or a leading advocate; it could come back and bite them.
Fear, uncertainty, and doubt are naturally occurring phenomena in the minds of every human being (to a greater or lesser extent depending on your disposition) when facing a decision. If I put a new food in front of my five-year-old FUD is written all over his scowling face! Politicians give us “weapons of mass destruction” to help garner popular support for important military decisions. In the realm of business the industry giants play on this natural instinct by putting out FUD related information with abandon, it’s their classic defense mechanism in a competitive situation. Your software salesperson will suggest you ask questions of the smaller competitor such as “how long have you been in business” or “how many customers do you have”. Whether you ask the question of the competitor is almost irrelevant, if your evaluation team don’t have their FUD earmuffs a forest of doubt is already growing, and all paths through it lead to one vendor.
Corporate Inflexibility and Lack of Imagination
If the corporate structure does not allow for risk taking, then the FUD factor is elevated, and employees have no choice but to go with the biggest provider. Broadly speaking large companies take fewer risks. Some are bucking this trend with spectacular results; Google has proved that you could be more creative and more productive if employees are more inspired than afraid. Rigid management, lackluster creativity and traditional “consequences” will help you find solutions that are evolutionary rather than revolutionary.
Prior Experience of Big Name Solution
The probability of a member of the evaluation team having used the industry leader is clearly higher than lesser known solutions. So the company could get taken down that path, there’s less FUD, someone takes on the responsibility. This could be great news, experience of the pros and cons may be invaluable. Alternatively other routes get shut down; the prior user becomes the expert who loves to demonstrate his or her knowledge. The company goes with a viable solution…..but not necessarily the optimal one and an opportunity is missed.
Lack of Choice
If there are only two providers to solve your problem, then your shortlist is ready before you start. Large corporations have large problems (ERP, accounting etc.) and the capability to solve them is highly specialized, so you could well be limited in choice. It’s also common for there to be a gulf between the largest and next largest provider. This particularly prevalent in the early days of a new technology or a new delivery method of a technology, such as the move to the cloud. There may be a slew of new players, but it’s tough for such companies to launch in at the enterprise level, it usually takes time and a track record. Or a lot of money. Or a spectacular value proposition.
Our company, SecureDocs, in the Virtual Data Room space, offers radically improved usability at a fraction of the cost of traditional providers. With a three-year track record, great reliability and zero security issues we rarely have to worry about FUD these days. At launch, it was a different matter, and prospective clients regularly went with one of the three established providers who towered over the industry. As a consequence, they often paid five to ten times more for a product that was hard to use and less secure.
Ouch. Tough one to admit but if the team assigned to evaluating a solution aren’t ready to properly explore all the options then they may well pour a coffee, kick their feet up on the desk and hit speed dial for IBM. Sorry, I tried not to mention them. Dynamic companies with motivated employees are less likely to encounter this issue.
When decisions around purchasing products and services are widely impactful, the accountability has run at all level up to and including the top. Those evaluating have to go through an effective process but to reach the best possible decision, with all options accounted for, they can’t be too afraid. A climate of fear with a “poop rolls downhill” mentality and no room for creativity is going to lead to a highly predictable outcome.
If the decision is stifled down to the industry default, and the outcome is less than positive for the company (read: “expensive cluster”), someone should get fired. Not the evaluators but those responsible for setting the culture and creating a climate where it’s impossible for the organization to make decisions that balance risk with reward.