Today I attended the grand opening of NOV (National Oilwell Varco) new facility in Houston, TX. NOV is a worldwide leader in the design, manufacture and sale of equipment and components used in oil & gas drilling and production, oilfield inspection, and supply chain integration services to the upstream oil and gas industry.
This facility was state of the art, with over 225K of operational space, 7.5 acre pipe yard, automated routing and delivery, smart forklifts who followed sensors imbedded in the floor and a 3,600 SKU carousel. The offices were light and airy, with top of the line meeting facilities. A perfect atmosphere to foster collaboration and productivity.
Naturally this event was invitation only with live music, catered food, limousine service, guided tours, customized golf cart service, valet parking and plenty of free giveaways. And this evening it was going to be top shelf open bar. NOV went all out and the attendance of very senior oil & gas business leaders showed that it drew the right crowd.
But when I looked at all the vendors it took to pull this off – the caterers, tent erectors, limo service, valet parking, signage providers, custom CGI animators, giveaway manufacturers and band I wondered how many of them had asked NOV if they could use them for a reference.
If you ask someone like NOV if you can use them for a reference AFTER you have signed the contract and delivered the goods, the answer will always be “No”. There is simple no compelling reason for them to agree.
But if you ask them before you close the deal, it then becomes a negotiation point. Which means for a little extra service, or a small price break you can get a “Yes”. Combine that with stellar customer service and you now have an extremely powerful reference. And that can be worth a fortune in new sales..!
Mark,
Love your blog. I’ve learned quite a bit, and I almost always agree with your POV.
But I wholeheartedly disagree with you on this one. First, why would anyone agree to give you a reference before you have performed a service. I would in no way agree to any vendor that I would provide a reference before the services are rendered and service evalluated, nor would I ask anyone to do the same for me.
Maybe it’s my background in sales, but I think the relationship I’ve built with my customer would allow me to get the “Yes” after the services were rendered and my performance verified. Actually, I know for a fact that I can get a reference from several large operators to this day.
I think the key is to always ask, but I would suggest asking after services are performed.
I really appreciate you following me Paul. My followers are the best, and I love that we all do not have the same opinion. But in this case I think I was simply not being clear (my fault).
What I should have said was that if you ask after the services are delivered, that usually its passed on to legal or PR to approve. And they look at it from a risk perspective. Not much of chance of that happening.
But if you ask the VP that needs your product or service beforehand “if we do a good job, can I use you as a reference?” its much easier to get a “Yes” without being handed off to legal or PR. And since legal and PR is almost always a shared service, the VP simple has more political clout.
And just to be clear I’m talking about rubber hit the road references. Stuff you would put on your website or sales material with the clients full permission…
I recall an experience back in 2002 when a vendor asked for a reference up front before signing the contract which I agreed to subject to the vendor meeting performance objectives. The value here was that the ask was up front and went through legal and communications as part of the contract review process. When the vendor met their objectives we were happy to allow them to use us as a reference.
The challenge with the post execution ask is that it would just become a burden on me to push the request internally with no incentive for legal and communications to act. I would only be motivated to push post-execution asks when I knew we had follow-up work in the pipeline.
Interestingly, the vendor that asked was using (then) VARCO as its reference customer!