Buyers Agents and Sellers Agents in IT from SMBITJournal
-
Latest article on SMBITJournal: Understanding the Role of Buyer's Agents and Seller's Agents in IT.
When dealing with real estate purchases, we have discrete roles defined legally as to when a real estate agent represents the seller or when they represent the buyer. Each party gets clear documentation as to how they are being represented. In both cases, the agent is bound by honesty and ethical limitations, but beyond that their obligations are to their represented party.
Outside of the real estate world, most of us do not deal with buyer’s agents very often. Seller’s agents are everywhere, we just call them salespeople. We deal with them at many stores and they are especially evident when we go to buy something large, like a car.
In business, buyer’s agents are actually pretty common and actually come in some interesting and unspoken forms. Rarely does anyone actually talk about buyer’s agents in business terms, mostly because we are not talking about buying objects but about buying solutions, services or designs. Identifying buyer’s and seller’s agents alone can become confusing and, often, companies may not even recognize when a transaction of this nature is taking place.
We mostly see the engagement of sellers – they are the vendors with products and services that they want us to purchase. We can pretty readily identify the seller’s agents that are involved. These include primarily the staff of the vendor itself and the sales people (which includes pre-sales engineering and any “technical” resource that gets compensation by means of the sale rather than being explicitly engaged and remunerated to represent your own interests) of the resellers (resellers being a blanket term for any company that is compensated for selling products, services or ideas that they themselves do not produce; this commonly includes value added resellers and stores.) The seller’s side is easy. Are they making money by somehow getting me to buy something? If so… seller’s agent.
Buyer’s agents are more difficult to recognize. So much so that it is common for businesses to forget to engage them, overlook them or confuse seller’s agents for them. Sadly, outside of real estate, the strict codes of conduct and legal oversight do not exist and ensuring that seller’s agent is not engaged mistakenly where a buyer’s agent should be is purely up to the organization engaging said parties.
Buyer’s agents come in many forms but the most common, yet hardest to recognize, is the IT department or staff, themselves. This may seem like a strange thought, but the IT department acts as a technical representative of the business and, because they are not the business themselves directly, an emotional stop gap that can aid in reducing the effects of marketing and sales tactics while helping to ensure that technical needs are met. The IT team is the most important buyer’s agent in the IT supply chain and the last line of defense for companies to ensure that they are engaging well and getting the services, products and advice that they need.
Commonly IT departments will engage consulting services to aid in decision making. The paid consulting firm is the most identifiable buyer’s agent in the process and the one that is most often skipped (or a seller’s agent is mistaken for the consultant.) A consultant is hired by, paid by and has an ethical responsibility to represent the buyer. Consultants have an additional air gap that helps to separate them from the emotional responses common of the business itself. The business and its internal IT staff are easily motivated by having “cool solutions” or expensive “toys” or can be easily caused to panic through good marketing, but consultants have many advantages.
Consultants have the advantage that they are often specialists in the area in question or at least spend their time dealing with many vendors, resellers, products, ideas and customer needs. They can more easily take a broad view of needs and bring a different type of experience to the decision table.
Consultants are not the ones who, at the end of the day, get to “own” the products, services or solutions in question and are generally judged on their ability to aid the business effectively. Because of this they have a distinct advantage in being more emotionally distant and therefore more objective in deciding on recommendations. The coolest, newest solutions have little effect on them while cost effectiveness and business viability do. More importantly, consultants and internal IT working together provide an important balancing of biases, experience and business understandings that combine the broad experience across many vendors and customers of the one, and the deep understanding of the individual business of the other.
One can actually think of the Buyer’s and Seller’s Agent system as a “stack”. When a business needs to acquire new services, products or to get advice, the ideal and full stack would look something like this: Business > IT Department > ITSP/Consultants <> Value Added Reseller < Distributor < Vendor. The <> denotes the reflection point between the buyer’s side and the seller’s side. Of course, many transactions will not involve and should not involve the entire stack. But this visualization can be effective in understanding how these pieces are “designed” to interface with each other. The business should ideally get the final options from IT (IT can be outsourced, of course), IT should interface through an ITSP consultant in many cases, and so forth. An important part of the processes is keeping actors on the left side of the stack (or the bottom) from having direct contact with those high up in the stack (or on the right) because this can short circuit the protections that the system provides allowing vendors or sales staff to influence the business without the buyer’s agents being able to vet the information.
Identifying, understanding and leveraging the buyer’s and seller’s agent system is important to getting good, solid advice and sales for any business and is widely applicable far outside of IT.
