The pain delays cause me. Over and over.

I suspect all entrepreneurs are highly sensitive to cashflow. I am. Maybe it is especially hard because we deal with governments and larger organizations. Either way, I cannot begin to count how often something that was supposed to happen one day ended up happening not just days later, but months (or in some cases years) later.

I tend to blame myself for this. I must be a bad leader if I haven’t built up the reserves, resilience, smart business model that shields me from all this.

But over the past year I have begun to cut myself some slack. Yes, I am imperfect. But haven’t we also been trying to do something really good and ambitious, against many odds. So last week really brought home the outsize pain that delays have caused me. The SBA payroll protection loans here in the US were just the latest example. Funds ran out? We will need to wait. Somehow.

Hopeful enthusiasm coupled with utter fear

I want to be specific about what a delay has typically meant for me and how much we have tried to prepare for it. Normally, it starts out with a formal commitment by a client, funder or partner as to what will happen. Just for good measure, we allow for 50% loss of commitments, already add 90 days to any promise in our planning and budgeting, on top of that we account for really big delays in actual payment. Still, we get a commitment. So we keep some resources available, try not to aggressively overbook and all the other things to do to put quality first.

It is now, that the pain of delay starts cutting in. Banks don’t really help with delays. Kind investors (with whom I have been blessed!) help out, but with time my word becomes only as good as my client’s commitments. This is when delays become personal: reduced pay for long periods of time, personal loans and the like.

Simply put, a delay is personally very painful and brings with it different degrees of humiliation. And all the while I juggle with that other reality: that actually our clients love us, they just take their time to get going. It really is schizophrenic — hopeful enthusiasm coupled meets utter fear.

Just maybe I am not the only one to blame

I am probably the first to blame for not being smarter about all this. But, I suspect, others are experiencing something very similar — especially these days. In retrospect, I realize how normal this feeling has become, that in fact it is the defining pain of my entrepreneurial experience.

So here is how I think these delays come about. It starts as a natural part of the sales journey. We misread a client signal of being committed. Any good sales coach will tell you to validate, validate, validate. But in reality, we found it very hard to validate commitments in large organizations. We often deal with innovators as our counterparts, who need to tread new ground to do business with us. So they may not be able to predict what will happen when. I would say this has been a big challenge for us for many years, but we began to get a better grip on it.

People are also generally hopeful creatures, and they may have a plan to start doing things by a particular date and then get distracted. So we have a meaningful commitment, but it gets sidelined. This can happen before or after a sale, and unless you are really aggressive about contract management and payment, you will need to simply hang in there. The prospect of taking a government, foundation or corporation to arbitration over a small contract is basically a non-starter.

Often, those making the commitments then rely on others to formalize them. This is a really painful experience because it all too often adds months to the process. And here, I think empathy would often be the glue that should hold things together. I feel terrible chasing clients and their contract or financial teams around. Reminding them already before a payment milestone because I know that more likely than not they haven’t done their bit. And still it happens. And because at just this sensitive point there is a hand-off on their side no one feels real ownership or control. Understandably, but remember, at my end I am in utter pain at this point.

So next to people misjudging timelines and delays in moving contracts and payment instructions through the system there is a third issue: project management. I can’t believe I have to write about project management here. But our clients or partners not adhering to a project plan has literally cost us millions of dollars. In one case, a government had a deliverable in week two to send us a list of problems they are working on. They delivered it 54 weeks late. No payment for 54 weeks, endless hours of chasing, check ins etc. Our contract was peppered with penalties if we should dare to deliver something a day late, but no protection for us. My guess is that this happened in more than 90% of our contracts, and I know just a handful of organizations that have reliably delivered their part of a contract (thank you, you are not forgotten!).

And there is even a strong culture to use delays against small business. The threat of more ‘complicated processes’ is all too often in the room, pushing us to shave off pricing to slip under some threshold. I have even had a major agency tell me “Unless you drop your price 60% to below threshold, I cannot be asked to push this through the system which would probably take 18 months by the time everyone has gotten around to it”. This came after a year of “we want to get started right away”. Sounds familiar?

Is someone or something to blame?

Since issue was so pervasive, I began to no longer blame people but suspect that it is systemic. Again, this may just happen in the minute world of business as I know it, with things running like clockwork for everyone else. It is not that project management or payment systems are at fault. It is actions by a ton of smart and kind people that is adding up to this experience. We should ask ourselves if it isn’t an asymmetry of resources that leads to these quite consistent behaviors.

But there is hope when people are really mindful to this issue. I have seen amazing empathy by people who really worked hard to give us a great experience, without delays. It is possible.

I feel you. Try it yourself.

Now, I wonder how I can conclude this post. I think I simply wanted to write to my fellow entrepreneurs who may be experiencing the pain of delays right now that I feel you. And that I think it is ok to say that it is painful.

If you are an investor, bank manager or consultant helping a small business, think about how you may be able to provide tangible assistance and comfort. And if you think we are just making avoidable mistakes, roll up your sleeves and help us fix it.

If you are a client to a small business, do remind yourself about the pain you are causing us, the shame many of us feel in constantly reminding you of milestones. There is a lot you can do by putting yourself in our shoes, being proactive in providing updates, making sure the internal hand-offs aren’t causing trouble. And yes, you too can be vulnerable about running behind on things or challenges you experience. The silence is what is most costly to us.

If you are in charge of policy in your organization, you should really think hard about what kind of relationships and accountability you are cultivating. Sadly, in 15 years and work with hundreds of organizations, I have only been asked by a single client about what our experience was. There are so many simple ways we could improve this.

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Sascha Haselmayer

Sascha Haselmayer

815 Followers

Passionate about social + city innovation, delightful procurement, connecting social entrepreneurs and governments. Fellow @ New America | Founder/CEO Citymart