Some of you are aware that last year I joined Avectra , a marvelous technology firm that provides database solutions to the nonprofit sector. This in and of itself is not strange, since I have been part of several similar technology firms over the largest portion of my career. In fact, virtually all of them focused on the charity space.
What I am about to write about is a wonderful surprise I became aware of since joining Avectra, however, to provide the proper build up to this surprise, please allow me to add a bit of historical perspective.
Over the years, each technology firm I have been involved with was a mixture of software revenue and service related revenue. The companies who focused on smaller organizations as customers tended to have a higher percentage of their revenue come from software rather than services. As the companies I worked for provided systems for larger organizations, so the percentages were reversed. More times than not, the amount of monies billed to these larger organizations for services exceeded the software amounts.
This is where the plot thickens. The service revenue often resulted from custom modifications to the software. Since this was usually a way to insure a proper fit and happiness to the customer, plus allow revenue to rapidly grow for the tech firm, the amount of such custom work being quoted and performed also grew rapidly. Such growth was greatly encouraged and budgeted for.
The zest for this growth, and therefore the service work, often resulted in exactly the same type of custom modifications being done for multiple customers. Very seldom was a second thought given to this practice because it certainly drove the numbers up and the customer s got exactly what they wanted.
The big surprise came when I saw my new employer, Avectra, encouraging both its existing and current customers to share ideas and new concepts. Notice the use of the word “share’ in the previous sentence. Sharing can be contagious because new ideas flow rather speedily back and forth during discussion of a client’s needs.
But the biggest surprise for me was what happened next. I learned that Avectra allowed this pooling of needs to lead to the creation of requirement documents and custom modification quotes which could be SHARED by multiple organizations. Even better, the more organizations which shared the need and split up the cost for the work, allowed more groups to have better fitting software at a lower price. And these modifications, more often than not, found their way into the standard baseline product.
Why was this such a surprise since it seems like common sense? I think there are three reasons:
- Sharing and developing joint needs requires more conversation and more effort.
- The overall revenue generated from service/custom modification work is smaller.
- Many industries are not willing to share their best practices.
Fortunately, much of what the nonprofit sector is founded upon is based on sharing and helping each other for the greater good. This premise allows such a wonderful practice to unfold if the for-profit technology partner has the same mindset. I am delighted to be surprised, but maybe not as much as many of our future customers will be as this practice gains recognition in the nonprofit world. Now, I truly know why my mother always insisted it was the best of behavior to share. How could anyone every doubt such sage advice.