Afternoon Tea in Jerusalem Blog

Life in Israel

Israeli commercial life and society

In addition to my work as a business coach, one of my interests is blogging about life in Israel. This is a country full of contrasts – over eight million citizens living in an area the size of Wales. You can see snow and the lowest place on the globe in the same day. Although surrounded by geopolitical extremes, Israel has achieved a decade of high economic growth. My work brings me in contact with an array of new companies, exciting technologies and dynamic characters. Sitting back with a relaxing cup of strong tea (with milk), you realise just how much there is to appreciate in the Holyland. Large or small operations, private sector or non profit, my clients provide experiences from which others can learn and benefit.


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When you need to let go of a valued client

Frequently, one of my first requests as a business mentor is to help my client ‘sort out’ one of their own customers. And the reality is that this is a customer that they do not need. Thus my issue becomes one of explaining why they need to let go of something that is supposedly the proverbial jewel in the crown.

In a classic case study a few years ago, I was asked by my client in Jerusalem to meet with his customer. The aim was to convince them to keep working with my client and to pay a higher price. And as the discussion progress, it was clearly evident that the customer had no loyalty to my client. For him, it was a cheap ride.

The core of the problem was that my client has made the classic mistake. He had been so determined to take on the customer that he had ignored some basic rules of running a business. And as he himself knew only too well, you cannot get away with that play too often.

However, there is the opposite scenario. What happens when your customer starts out as a ‘fat fish’, but implodes? Typically, this arises in a long-standing situation. Personnel on both sides may change. The deliverables alter, even if this has not been officially documented. Externalities, such as regulatory issues, creep in. Maybe the remuneration becomes fixed for too long.

In other words, the joy of that once special relationship has evaporated, and without both sides comprehending how or when. Such a situation is known as the ‘golden cage’ scenario. It looks like a great deal for one or the other side – maybe both – but actually you are trapped.

This is a story that many of my clients face. One area where it comes up is in support services for digital media. Payment is determined by a fixed number of monthly hours. However, these are rarely sufficient. The work is carried out and the revenue seems healthy. At the same time, my client wakes up to the fact that they have less resources for more lucrative contracts. Ouch!

It is at this point, where a business mentor steps in and forces the service provider to answer a painful question. Is the effort truly worthwhile? And the determining factor may not just be financial reward. Other elements, such as brand creation, interest, training of juniors, and more may come into play. Yet, whatever the issue, hard decisions do need to be made.

And sometimes you just have to let go, for the peace of mind of both sides.

(Dedicated to my mother, who passed away this week).

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