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How a PM’s Complacency Cost His Organization Millions

Tom was the Program Manager of your organization’s longest-running program. Like most PMs, he was swamped and didn’t have time to waste on non-project-related tasks like relationship development. He already had a great relationship with his DOD customers. There were never any communication issues. He quickly resolved operation problems, and they often shared jokes or chatted about sports or weekend happenings.

Tom’s organization had been the incumbent on this program for over 20 years, and there was little doubt they would retain it. Although the recompete RFP contained a few surprises – Tom remained confident, saying, “Don’t worry; we got this… they love us.”

Tom couldn’t have been more wrong!

The award went to a competitor, and while they celebrated their win, Tom’s organization was in shock. They were left contemplating what had gone wrong, panicked about how to fill the revenue gap, and worried about having to lay off some of their longest-serving employees. Sound familiar?

The High Cost of Overestimated Relationships

Tom made the error of assuming casual chit-chats meant he had good customer intimacy. Why wouldn’t he? His organization didn’t have a standard definition or any objective ways for him to measure customer intimacy.

So, Tom made assumptions and shared them with his leadership. Overly optimistic and suffering from confirmation bias, they were happy to believe him! An often-quoted Bain & Company statistic shows that 80% of executives believe their teams deliver superior customer experience, but only 8% of customers agree. This 72% gap isn’t just embarrassing—it’s a significant barrier to success that leaders must overcome.

Tom’s story isn’t unique. A 2019 Lone Star Analysis found that 40% of incumbents lose recompetes because of overestimated customer relationship quality. So, there is a good chance this silent killer has struck your organization, leaving you to endure the frustration, embarrassment, and anger of explaining to your leadership how a competitor just won your ‘sure thing.’

The Root of the Problem

Why do people overestimate relationship quality? The answer often lies in human nature and workplace dynamics. Let’s explore some of the reasons:

  1. Reluctance to Engage: Employees rationalize avoiding customer interactions. They focus on the negatives rather than how each engagement is an opportunity to help the customer.
  2. Fear of Negative Perceptions: Concerns about appearing ‘salesy’ or intrusive can limit meaningful engagement.
  3. Misreading Casual Engagements: Small talk and jokes are mistaken for customer intimacy.
  4. Confirmation Bias: People seek evidence confirming their belief that the relationship is strong, ignoring negative signals.
  5. Misinterpreted Courtesy: Professional politeness is often confused with loyalty or satisfaction.
  6. Lack of Honest Feedback: Customers’ reluctance to provide negative feedback can create a false sense of security.
  7. Overvaluing Longevity: Long-term relationships are assumed to be strong, even when they may have weakened.
  8. Past Success Fallacy: Previous achievements are seen as guarantees of future relationship quality without maintaining active engagement and trust-building.

Understanding these factors is crucial for accurately assessing and improving customer relationships. This avoidant behavior results in limited intel gathering and increases the likelihood that assumptions will be used instead of validated facts in opportunity or gate reviews.

Preventative Measures

Losing a recompete can be the difference between celebrating a successful year and laying off teammates. As a leader, it’s crucial to prevent situations like Tom’s from happening in your organization. Here are some steps you can take:

  1. Watch for the Warning Sign

The front-line team often misses the subtle human clues crucial to relationship success. These invisible weaknesses in your customer relationships are like a cancer that goes undetected until the damage is irreversible.

As a Leader, you are responsible for recognizing over-estimated relationship symptoms as early as possible. These include:

  • Limited Engagement: Your Team never engages the customer outside of formal status or review meetings.
  • One-Way Communication: Your Team eagerly provides capability briefings, white papers, demos, and solutions but gets little intelligence in return.
  • Limited Account Penetration: Relationships are limited to operational contacts or the same customer stakeholders without more strategic customer engagement.
  • Same Intel: Your Team asks similar questions and gets the same intelligence as your competitors, offering your proposal team no competitive discriminators.

Often, when you identify these symptoms, you may already be at risk of losing the opportunity.

  1. Define Relationship Quality and Measure it.

You can’t improve what you can’t measure, and you can’t consistently measure something that is poorly defined. Most organizations don’t have an agreed definition or way to measure Customer Relationship Quality (CRQ), leaving this to individual interpretation, unvalidated assumptions, and misinterpretation.

Many organizations use the HI-Q Customer Relationship Quality (CRQ) assessment to overcome this. This 6-level scale (hostile to collaborative relationships) standardizes definitions and objectively self-assesses an individual’s customer relationship quality.

The Hi-Q CRQ assessment is valuable for validating your team’s quality assumptions. It also provides a way to track relationship quality at individual, account, and opportunity levels. Think of this assessment as the ‘canary in the coal mine’ providing the warning needed before it’s too late and the silent killer strikes again.

  1. Underestimating the Competition

Overestimating the quality of your customer relationships is risky, but underestimating your competitors’ relationships can double your risk. Remember, your competitors will actively work to strengthen customer relationships, often in ways you might not see.

A sage once said, “If it’s not a must-win for you, it probably is for one of your competitors.” As a Leader, you must always keep this in mind as you objectively assess the relationship quality of your team and the competitors to ensure you don’t succumb to confirmation bias.

Closing Thoughts

Tom’s story is a stark reminder of how relationship quality often separates winners from losers. Don’t let complacency and denial cost your organization millions like Tom’s.

Wouldn’t you prefer to know early if your team has the relationship quality needed to win or who within your organization has the best relationships with a new stakeholder? By implementing a standardized way to measure your team’s relationship strength, you can develop plans to proactively:

  1. Engage additional stakeholders.
  2. Improve customer intimacy with current stakeholders.
  3. Fix or determine hostile relationships can’t be fixed.

Unchallenged assumptions about relationship strength can silently undermine not just upcoming opportunities but your entire organization. Remember, Tom thought he had this in the bag because the customer loved them. And his leaders had no objective way to measure this!

If they had been using the Hi-Q CRQ tool, they would have seen that Tom’s relationship was, at best, transactional, and he wasn’t as well positioned as he thought. This might have been enough to stop the silent killer before it struck and to keep their flagship contract.

Doing this means you should never have to explain how a competitor just won your ‘sure thing’ opportunity.

Don’t let overestimated relationships become your silent killer. Schedule a free consultation today to learn how the HI-Q Customer Relationship Quality assessment can transform your organization.


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