Monitoring your microvendors
As an agent, a broker, or a technologist, you probably interact with a world of small vendors who provide one or a few software services and do it well. I’ll call these micro-vendors, as opposed to vendors, who provide a whole suite of services.
For example, ZipWhip is a micro-vendor (text messaging), Google is a vendor (mail, docs, spreadsheets, forms, file storage, calendaring…). Dropbox is a micro-vendor (file storage), Amazon Web Services is a vendor (hosting, DNS, compute power, databases, file storage…). Micro vendors are often subscription services, where you pay a monthly fee for their services. These fees can range from pennies to tens of dollars.
When you sign up for a micro-vendor, it is often to scratch one particular itch (solving one specific problem that is right in front of you). The cost is small enough you are willing to try it, and if it serves your needs, you continue to use the service. Rarely are you going to perform some kind of full scale vendor evaluation for the services provided by a micro vendor.
However, because micro-vendor services are so small, targeted and easy to sign up for, it is also easy to sign up for too many of these services and have overlap. Dropbox and box.net both provide materially the same service, for example. In addition, these services are often iterating on there offering. And/or being acquired or shut down. In short, while micro-vendors provide solutions for an immediate need, they change often enough that you should monitor them after signup.
To start the monitoring process, first, catalog all of these services, preferably with login information (I’d suggest using software like passwordsafe to keep authentication information secure). It doesn’t have to be a complicated list–you just want to capture service name, url, and your usage, and perhaps authentication information. A spreadsheet is a fine place to start (this is definitely a case of the perfect being the enemy of the good).
The next step is to monitor all of these services you are using. You can do this in any number of ways–you just want to find a method that works for you. Methods I’ve used in the past include:
- Subscribing to an email list
- Following the service on twitter or facebook
- Subscribing to the RSS feeds from their company blog (I like newsblur.com, but then you must remember to check the RSS reader)
- Technical monitoring such as that provided by pingdom.
Whatever notification method you choose, make sure it is in your normal flow. The point is to make it easy for you to be conscious of changes to services you depend on, but might overlook.
Now that you’ve done the initial work, there is a bit of ongoing effort involved to reap the benefits.
First, incorporate monitoring into your future processes so you don’t have to do the above survey every year. When you sign up for a new micro service, you should add it to the list.
Second, you should read any service provider notifications, looking for warning signs (the service is shutting down in two months because Yahoo! acquired them or they’ve been hacked and you should change your password) and additional value they can provide (they’ve added the ability to copy user profiles that you have been jonesing for or they just offered the same level of service for half the price). Depending on what is happening, you can either look for alternative solutions or take appropriate action or leverage new capabilities.
Third, you should review your list periodically and make sure you are getting the same value out of each service and that there isn’t overlap due to services adding more functionality or someone signing up for a service without checking the list. A great time to do this is when you are reviewing your business expenses for tax filing or annual budgeting .
I realize that in a fast moving business monitoring these services causes additional drag, but when you buy software to solve a problem, that software becomes part of your business. It needs to be monitored–you’ll thank me the next time that one service that you depend on shuts down, and you know about it and have enough time to migrate to a different service.
You wouldn’t hire an employee and never check in with them about the work they were doing, would you?
Bryn Kaufman
Posted at 09:26h, 07 AprilDan, sounds like a good idea, although 3 of the ones you mentioned probably don’t need to be monitored for going out of business. That being Amazon, Google, and DropBox.
What is harder is to monitor the vendors offerings. For example, all three of the above vendors offer cloud storage options. The costs and features are changing and sometimes you might feel like you don’t have the latest good deal.
It is not easy to switch though. We have all our files in DropBox, we tried to switch to SkyDrive at one point, but after testing it out found it was missing key sharing features we needed, so we are still with DropBox, and probably will just stay there as moving all the data is a little scary.
Dan
Posted at 09:40h, 07 AprilHi Bryn,
I agree that amazon and google don’t need to be monitored. DropBox might have been a bad example of a microvender (because as a company they are so big). However, smaller vendors or startups that do one thing and do it well should definitely be monitored to make sure they don’t pivot or go out of business, etc. I’ve seen it happen too often.
You make a great point about switching costs–it is never easy when you depend on a vendor. Sometimes it’s less difficult than others (staff retraining vs what you are doing, which includes staff retraining and moving tons of data). However, I bet there are situations in which you can imagine moving away from DropBox (service degradation, increasing costs, etc). You do have to weigh ‘getting the best deal’ with the internal costs to switch vendors, for sure.