Unfriendly Cancellation Policies

 An emerging theme for me has become, Treat your clients as you want vendors to treat you! That's a pretty good way to measure both your vendors' and your own company policies.

The most recent example for me has become licenses. You all know the kerfuffle around Microsoft moving to annual licensing with little flexibility. I've had similar experiences inside and outside the world of tech.

We are deep into the subscription economy. Whether it's easy on/off services like Netflix or impossible to negotiate licensing like Kaseya or Egnyte, we are also in the era of license management. Here's a simply way to hold a mirror up to your own company policies:

• Keep track whenever you find yourself furious with a vendor about license renewal

• Break it apart. What do you specifically hate about the license (renewal/cancel) process? Was it communication, ease of making changes, friendliness, being treated like a dollar stream instead of a valued customer?

• Okay - Now, how do YOUR policies stack up against that? Do you force clients into long-term contracts become some wonk onstage told you it would improve resale value? Do you give advance notice of renewal to avoid big surprises? Is your communication focused on people or money? How do you handle it when clients have been charged and do not want to renew?

Unfortunately, you are stuck in the middle. Many vendors are 99.7% focused on revenue extraction as their highest priority. So making you happy is irrelevant for one simple reason: If you cannot cancel before the end of this quarter, they meet their numbers and everybody probably gets to keep their job.

When you business horizon is somewhere between three months and twelve months, the long-term relationship of a customer is irrelevant.

But you don't have customers. You have clients. If your business is going to be successful and profitable in the long term, you cannot focus on a strategy of 20% growth every year, adding more and more and more licenses until the number of licenses is the only thing that matters. You need to keep human beings happy in a sustainable and profitable manner. Pissing them off is not in your best interest.

In the long-term, I hope that vendors realize that there's money to be make with doing the right thing and treating people well is the best, most profitable path. But that would require a massive turnover in decision makers at the top for many, many vendors.

In the meantime, you need to stay vigilant, pick vendors carefully, and do what you can to manage the client relationships that will keep your business successful. When vendors lock you in, they lock in your clients as well. You need to manage both those relationships.

Good luck! It's going to be a long time before this era is over.