Doing Business with Friends - Lessons Learned the Hard Way - JKA Supplier Diversity Consultants

Doing Business with Friends – Lessons Learned the Hard Way

Over the years, many of my clients have become lifelong friends well beyond our client engagement. When clients become friends, it has been my experience that many of us let our guards down and treat the business relationship a lot more casual – blurring the lines so to speak.  Blurred lines can be detrimental both personally and professionally. I’d like to share an example of a situation that happened in my business when I blurred the lines.

Several years ago became a sub-contractor on government contract. I remember very distinctly being very methodical about how I approached the relationship because quite frankly being a subcontractor in a certain type of environment scared me. My inner control freak hates not being in charge – I made sure to dot every I and cross every T.   As time went on, the program manager and I became good friends.   With “friends” you tend to be more casual, let your guard down a little bit and that is exactly what I did.   The business relationship was mutually beneficial, as a team both the client and I consistently exceeded contract goals. In fact, the contract was renewed year after year without going out for bid (which is always an option on multiyear contracts).  Things were good until the program manager unexpectedly left the company.

That’s when things took a turn for me. Because I let my guard down with the previous program manager, it was common place for me to perform services that were outside of the scope of work while waiting for a change order. Most of this communication was verbal – we’d get a request (often an emergency request) that changed the scope of work or added new locations. We were eager to please and happy to get the work, so we responded and eventually a PO or change order would always follow. Payments were always prompt, and it never occurred to me that things might change.

When the new program manager took over, it was difficult for that person to connect the dots which caused lengthy delays in us getting paid. And, let me be clear, when I say lengthy, it was the type of situation that almost put us out of business – this client represented nearly thirty percent of our annual revenue. Long story short – I am no longer working with this company and I still have not been paid. In fact, I don’t expect to be paid anytime soon.   Now many of you may be asking, why didn’t I sue, or go over that person’s head, etc., and here is where the lessons come in.

I believe that everything happens for a reason, and this experience although very painful for me, taught me a valuable lesson. There is never any excuse to treat any business relationship as casual, especially when doing business with the government. All government contracts are clear on the process and procedure for making changes to a contract, and I did not follow that protocol.   At minimum, I should have had some form of written communication backing up the verbal requests and I should have been more diligent about follow-up.

And, yes could I have sued, made a big stick and cause a lot of issues of that client? Absolutely. But I have also been down that road as well, and burned bridges are often worse than blurred lines.   The facts are that I as the responsible party for my firm should have known better. Rather than blaming someone else for this situation, I chose to take responsibility for it and learn from it.



Today, things are very different in my business – while I am still friends with almost all of my clients, I am diligent about not blurring the lines. I follow-up on all verbal requests with a detailed email copying the appropriate parties within my organization to ensure accountability. I share responsibility with my project manager and bookkeeper with through an automated system that provides for increased efficiency. This was an expensive, painful lesson that has prepared me for a better and more prosperous 2016, and I hope my sharing it was helpful to you as well.


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