Too much information

A mate of mine from my university days works as one of the bosses in a company supplying specialist equipment to the oil and gas industry.  A few years ago, back in the days before the oil price collapsed and such jollies were kyboshed, I met him at his company’s stall at the ADIPEC exhibition in Abu Dhabi.  We started talking about his role in flogging equipment, and he told me over the course of the conversation that you can tell very quickly what kind of organisation you are dealing with, and whether it will be a waste your time, by observing their behaviour in the first month after initial contact.

He told me one of the biggest red flags was rapid and continuous demands for “more information”.  If the words “please provide” appear in any of the correspondence, you’re probably wasting your time.  His product range was substantial, but the example he gave me concerned fireproofing material which he’d attempted to pitch to a large oil company in Central Asia.  Naturally, he brought with him the full sales package, including all the technical information associated with the actual product.  Despite his potential client turning over billions per annum and running a gargantuan operation, he walked into the meeting room to be faced with half a dozen tired and elderly men and women who looked as though they were doing their graduate training when Nikita Khrushchev was building the Berlin Wall.  The technical leads were impressed with his product, and they were sorely in need of it, but once they’d established their interest in the actual valves they started looking shiftily at each other, as if unsure what to do next.  After some mumbling back and forth in their native tongue, one of them finally ventured:

“Are you registered to do business in our country?”

To which he replied “Of course.”

Another lengthy pause, then one of them suddenly brightened and asked “Ah, but is your product certified by the fire protection authority in our country?”  This made all the others nod vigorously and murmur in agreement.

“Yes,” said my friend “it is.”

Heads sunk.  More mumbling.  Then “Do you have a license to import this product?”

Things didn’t go any better after the meeting.  For the next three weeks he found himself in an iterative process whereby they would request documents and information (company registration certificate, power of attorney, tax records) which would he would provide, only for them to come back and ask for more information (import licenses, fireproofing certificates) which he would duly supply, at which point they’d ask for yet more information (“we need certified copies of everything”),

What was happening was obvious.  Although the technical people liked the product and needed it badly, nobody had the courage to commit to adopting it.  This would not only require somebody to make a decision for which they might later be held responsible, but they would have to deal with other departments (procurement, finance) who would make the task almost impossible and they would need to persuade senior management who owe their position less to their business acumen than their willingness to inform on their neighbours in the 1970s and then hire ex-weightlifters to smash in the heads of their business rivals in the 1990s.  Faced with internal obstacles of this nature, it’s much easier to say the new product cannot be accepted due to lack of documentation, and just keep on doing what they’ve been doing since Yuri Gagarin became a household name.

My friend quickly learned that a company which is serious will ask for a standard set of documentation once, and possibly some specialist technical information later with a clarification or two, and then quickly move on to commercial stuff: when can we get them, how many, how much, etc.  But if a company asks you for masses of information, especially in the form of “Please provide the following” at the head of a long list of generic documents, and repeatedly asks you to supply increasingly detailed and obscure information, then it is fair bet the people with whom you are dealing won’t have the authority or capability to ever place an order.

Most worryingly, my friend told me that whereas this is commonplace in state-owned companies, it is increasingly becoming the case in major western oil companies.  Not for the first time I get the feeling that the two are converging, and not in the way they are supposed to.

“You need to fill out these before we can do anything.”

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2 Responses to Too much information

  1. Frozen says:

    Sounds like there was a prefered supplier of PFP who perhaps had a slight COI. I’ve seen that behaviour many times when companies try to make the tender process look legit.

    • Jake Barnes says:

      Yes, that is a possibility and I’m sure the root cause of much of this behaviour. Although in the case of this particular company I don’t think they even had fireproofing on their valves to begin with!