[bruce511]

You're both getting what you want, but you are different businesses, so you are optimizing for different things.

In other words, you have a business of a certain size with a certain set of constraints and goals. For most small businesses the constraint is not enough money, and the goal is to make more money.

Naturally you see your client as a "big version of your business" and therefore you think they are optimizing to the same goals as you. When interacting with corporates this is a really common mistake.

What's really happening is that to them they have all the cash in the world. The difference between 30k and 150k is nothing. Literally nothing.

However they likely have incomings and outgoings totally hundreds of millions, if not billions, each month. When you move that much money some jobs are likely to be _really_ big, and doing it right the first time I'd important.

So they have a buying, and paying, process. That process is optimised for say 50M and up. But the process applied to all purchasing, they want 1 process, not 3 or 5 or 10.

Your tiny rounding error if a job is therefore irrelevant. Money is not the limit. They want to use their process. Andif you are happy to wait 100 days, then they are happy to spend more.

Would you rather spend 30c now, with a bunch of hassle, or $1.50 in 3 months time with zero hassle. Since $1.50 is nothing, you're happy to pay more for no hassles.

Neither of you are getting a bad deal, and yes they are getting upside you can't see. You are playing to one set of rules, bug they have a very different rule book.

[B-Con]

This is an incredibly realistic and pragmatic take on how large companies work.

> You're both getting what you want, but you are different businesses, so you are optimizing for different things. [...]

> The difference between 30k and 150k is nothing. Literally nothing. [...]

> Would you rather spend 30c now, with a bunch of hassle, or $1.50 in 3 months time with zero hassle.

Anyone who struggles to understand why corporations do what they do should internalize this thought process. It explains a lot.

[qprofyeh]

So I assume if they hired someone cheap who’s only job is to manage OPs account payments, and they did this for perhaps 100 other accounts (manager per account), they’d still make millions profit extra, yearly? I indeed struggle to understand why anyone is leaving that on the table.

[rsj_hn]

Because administrative structures are not about hiring one more body to do random job X.

Each body in the machine needs a reporting structure, training, tooling, a career path, and be plugged into other structures that have visibility to and alignment with, senior management. So it's about trying to maximize the size of your company while keeping the complexity manageable. In a big organization, management is struggling for simplicity and visibility, and one technique is standardization of processes and alignment on goals and processes so that you have more than just a big bureaucracy doing thousands of inscrutable things, but you have a bureaucracy that management can understand, measure, and steer as best they can. This is the biggest challenge.

So they tend not to do things like hire one off people to do random things at odds with what everyone else is doing.

That means you do not chase every possible thing which appears to have some upside but adds complexity. Because following the latter approach is the administrative equivalent of "yes, we are an autobody shop, but people often come here hungry, so let's also sell them some pancakes" -- a decade of these type of decisions and you have a huge unmanageable mess.

Clay Shirky once wrote a piece in which ATT reached out to him for a business discussion about getting into web hosting, and when he told them how little he paid for web hosting, they were absolutely stumped at how anyone could provide reliable webhosting for a profit, and Shirky replied that his webhosting just wasn't very reliable. He tells them there is no staging environment provided, no failure, no offsite backup, no redundant power -- how sometimes he'd just take the main site offline when he wanted to update, and other times it would go down when there was too much traffic. The ATT folks just stared at him in disbelief. And Shirky knew that they weren't going to get into the web hosting business because a company can't both be good at doing one thing and the opposite of that thing at the same time. A company that has reliability in its corporate DNA isn't going to "hire a few guys" to create a cheap, yet unreliable offering - even if it means they are leaving money on the table.

[homeland221]

There are 2 kinds of businesses...one extremely profitable and another on dying path. If the company you're dealing with not dime nickel you sooner or later they will be the on the dying path. You can readup Nokia outrageous expenditure in Europe. Heck if they are dying or extremely profitable, just take advantage of it. It is business. Nothing personal.