Horst has been working as a consultant for a large international corporation for more than a decade. Over the years, he has conducted audits, helped the transition of work to new vendors, managed vendor relations, and done other work beyond his primary duties. He enjoys the intellectual challenge and the opportunity to be of service to an organization with a long history of success and innovation.
The client has come to rely on Horst a great deal, but its payments for his services are being made more slowly each month. Horst has tried at least five times this year to work with the client’s vendor toward a payment solution that works for both of them. Each time, Horst gets checks cut, but with excuses, and empty promises that, if he goes to the vendor instead of the client, the payments will be paid promptly all will be resolved promptly next month. Each month, Horst expects to hear the same excuses when asking to get paid. He now sets aside time he would rather spend on client work to follow up so he can meet his financial obligations.
The client’s past due balance has grown to four months’ worth of work for this client, which takes up more than 50% of his client time each week. Although the client gives him a lot of work, he is growing tired of the added unpaid work required to get paid for it. Each week, the routine is:
- Send past due invoices with reminders
- After one to two weeks, contact vendor liaison
- After another two weeks, call the client
It’s two weeks before the end of the year. There are tax payments coming up and holiday gifts to buy, not to mention the regular expenses, such as payroll, insurance, utilities, and office space. The client still hasn’t paid even a portion of the past due balance.
Action One: Define the Conflict
Horst and his client disagree about what is timely payment. They disagree about who is responsible. The client claims it is solely the vendor’s responsibility to pay for services the client purchased.
Action Two: Identify the Interests
Horst wants to be a responsible, business owner. He thought his commitment to his client would–at the very least–be acknowledged with timely payment for his services. He believed their relationship was stronger and that his good, hard work would be appreciated. He expected in return the same commitment and respect he gives. He wishes his client cared that he is a human being with other human beings relying on him. He has to do something different before he has to declare bankruptcy and business failure.
Horst doesn’t truly know his clients interest in this conflict. Despite his calls and e-mail messages, no one is responding to him. This has him guessing:
- His client wants the work done, regardless of circumstances
- The client representative probably thinks it has adequately delegated duties to the vendor and Horst’s payment shouldn’t be the client’s issue to resolve.
- The client likely believed all was well, and that is partially Horst’s doing. He didn’t want to complain constantly to the client and hoped it would magically work out if he gained the vendor’s loyalty by covering their tracks.
- The client expected to delegate tasks to Horst and the vendor without the need for further involvement.
- The client wishes the conflict would disappear. It has “bigger fish to fry”.
- The client has to focus its energy elsewhere.
Action Three: Play with the Possibilities
If this conflict would resolve in any way possible, the client’s vendor would pay Horst’s bills timely and do complete work. He wouldn’t be picking up their slack just so they can take their fourth paid vacations for the year, while he worries more than they do about the business. He wouldn’t be doing as much work out of scope of their original agreement, and he wouldn’t feel so disrespected.
Action Four: Create the Future
- Horst will call his client to discuss winding down their projects together.
- He will continue to do his best work during the transition.
- He will also continue to build other lines of business and streams of income to diversify his business.
- He will keep the lines open for new communications and opportunities with the client if they choose to acknowledge his desperate calls for change.
Action Five: Stay on PARR
Horst will Plan, Act, Revise, and Repeat until he gets the results he wants and needs.
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