Situation: A company sells specialized components to a large manufacturer. The manufacturer is building a new product and, for this product, is requiring that all suppliers be approved suppliers. The company sells other products to this manufacturer and is in process of becoming an approved supplier, but the manufacturer wants to start using the company’s components for their new product now. As a work-around, they have asked the company to teach someone else their IP until they are approved. Would you share your IP with another company? How important is it to protect your IP?
Advice from the CEOs:
This is a creative request from a large company to a smaller supplier. Absent a legal requirement that suppliers must be approved – not the case here – they are simply trying a bureaucratic ploy to get you to release your IP. Your component is necessary to them and they can’t get an equivalent component from anyone else. If they want your component for their new product, and want to release the new product on their internal timeline, insist on a waiver for the new policy until you have become an approved supplier.
Stand on principal. This is your IP and it is proprietary. If another supplier, a potential competitor, has the IP to do what you do, you don’t need to train them. If they need your IP to make the components you need to protect it.
Ask the manufacturer to put you on the fast track to approval supplier status. This is faster than teaching someone else your process.
Escalate this within the customer company until you find an audience.
Bottom Line – don’t give away your secret sauce. This request is unreasonable. Unless, of course, the other company is willing to give you satisfactory compensation for your IP.
Interview with Greg Hartwell, CEO and Managing Director, Homecare California, Inc.
Situation: Fast growing companies find it difficult to manage consistency and reliability of service as they scale to their next level of growth. They need to systematize what works and leverage technology to enjoy the benefits of scale. How do you build consistency and reliability as you scale up?
Advice from Greg Hartwell:
Invest time and effort to build an experienced management team. As a small company building a new service delivery model, it is helpful for the founders to know all roles so that you have a sense of what’s needed for each role.
Be open to hiring people from other industries. This brings a fresh perspective and broadens the pool of talent. There’s value in industry experience, but attitude and cultural fit are key.
The split between tactical and strategic skills is 80 / 20. Basic skills are necessary, but specialized knowledge can be learned.
Institutionalize how you recruit, screen, hire, train and retain. How do you do it like Disney – attracting and hiring the best of the best?
Know your market and the personality of those who will excel. This greatly simplifies the screening process.
Work hard on training. Our customer-focus starts with our employees. We complement natural talent with training that focuses on soft skills, and on consistency and reliability of service.
Find great advisors who can help build a training and retention system that works for you.
Minimize turnover by compensating people well, and treating them even better. Build a culture of recognition and shared experience that emphasizes the importance of the team and its members.
Embrace technology which enhances your ability to scale.
Don’t wait for something bad to happen and then rush to fix it. Anticipate and prevent mishaps.
Leverage communication technologies to tighten the bond between client and provider agency. Provide added services that are valuable and affordable.
Hand-held device technology is developing rapidly. Leverage this to increase consistency and reliability of service, enhance case reporting, reduce human error, reduce the ratio of supervisors to caregivers, and increase productivity. Be at the head of your industry class!