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Comment by csallen | Hacker News Reader

My stepdad manages a team in IT for a very large, very slow company in the banking/financial sector. The decisions about what software and hosting solutions they'll use are made by execs at the upper echelons, probably over games of golf by people who don't know that much. They just know, "I really like Jim over at IBM, he's got a real swagger to his step" and "other big companies are using them" and "hell they just bought a Super Bowl commercial." So a $2M deal gets done, and IBM stays in business.

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I spent 10 years at a small (<80 people) CX company that was full of intelligent, motivated employees. We were smart and quick and lean and did very good work. But we never dragged in big deals because no one at the company had that swagger/access to high-levels. The scenario you describe is dumb and ruinous and, unfortunately, true.

Big deals can really put a company in danger. If the company you work with closes or cuts the deal or whatever you could loose half your revenue. On top of that big clients can be really needy especially dinosaurs companies that aren’t nimble. They take forever to pay, have lots of meetings and unreasonable expectations and expect lots of free stuff and service because they are incapable of processing Non standard invoices due to internal politics. It’s a mixed bag to deal with the big guys

While that's true, the execs who make these decisions usually don't care about the actual implementation. Once the deal is done, it falls on their "IT division". And two things happen: Jim over at IBM still pampers the exec with a dinner or two. And the exec also suspects that some, if not most, of the problems are with his IT team.

Big companies have very strong anti kickback rules. You can get around them through board level connections but not much sort of That. Nobody Is risking 500k a year compensation over a dinner or 2.

Well, dont forget it takes 6-12 month for your company to be registered as a suplier in the ERP.

I saw this play out first hand: a local digital agency run by a friend essentially ended up "captured" by a major player in the aerospace industry, to the point that 65-75% of their business came from $BIGCO. They grew by 100%+, had employees flying all over the world to set up for trade shows, and were making money by the truckload.

Then Covid hit, nobody wanted to fly, and $BIGCO took an earnings haircut and decided to cut back. My friend had to let dozens of people go. It ended up costing him his company because he'd neglected bringing other work into the pipeline.

Yep that’s super dangerous especially cyclical industry like aerospace. Plus aerospace companies are notorious for paying late are having unreasonable demands.

Coworker dad went from being a millionaire to living in a truck this way too.

I think a lot of engineers shoot themselves in the foot looking down on social networking skill and the ability to speak corporate, as it were.

100% agree. I know many capable developers who will never do anything other than close tickets because they cannot build relationships. Some of them do not even understand why building a relationship might be fruitful.

Big corps tend not to do deals with small corps. They don't want the small corp to become dependent on them. Simple contract termination becomes costly and litigious otherwise.

Let the big fish swim together.

Add counterparty risk to that too: if things go south and Big Corp decides to sue, small corp may go bankrupt in the process.

I've worked as a sales engineer/architect in teams selling to people like your stepdad's execs for almost a decade. I can 100% guarantee the sales reps and their leadership constantly practice "swagger" and remind each other of its importance. It's hilarious.

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