The rich get richer: Why smart service contractors make smart software decisions

I have noticed an interesting trend with ServiceTrade customers: the large majority are already in the top 10% of the industry regarding both systems capability and typical service contractor metrics – growth, gross margin, net margin – when they first engage with us, yet they readily buy ServiceTrade (typically with only about 2 weeks of free trial). Simultaneously, I see prospects who would receive extraordinary benefit from an upgrade to better service contractor software (terrible systems, very poor execution metrics) and they are absolutely unable to make a decision and move forward.

My best guess is that the guys with better systems and better metrics have the confidence to move ahead again and again. They have seen success with upgrades and technology, so seeking greater success is second nature to them. The folks with horrible systems and poor metrics have never had a good experience with systems (and it shows), and therefore they are jaded and so overwhelmed dealing with the messiness of the business that considering an application like ServiceTrade (or other best-of-breed vendors like NetSuite and Salesforce) is not an option.

But where does this dynamic lead? I suppose it leads to the “rich getting richer” and the “poor” continuing to struggle. I suppose it is inevitable, but I am disappointed that those that really need help cannot get it because their history with bad systems and bad actors has painted such a miserable picture of change. I cannot tell you how many times I hear:

“The last time we changed our application, it was a horrible experience that took years off my life. I hate what I have now, but I will not change ever again.”

Here’s the thing about not changing anything: nothing changes. The world moves forward, and companies with this mindset are trapped. Most owners are from the baby boomer generation, and they are just hanging onto the income from their business (to the extent there is any income, otherwise they are just hanging onto a tax shelter) because the 2nd generation has moved outside the business (i.e. doesn’t want to run it) and there are no other potential buyers out there. When they retire, the brand that took so much effort to build will just die. The only way they can escape this dynamic is with a leap of faith to modern capability, where effective systems and processes can help institutionalize customer service and operational management at a fraction of the cost and aggravation they suspect will be necessary. They can then transition the business to another operator and reap the value they deserve…but it will not happen without change. Without change, the rich will simply continue to get richer, while others will work for pennies until they disappear.