From the February 2003 issue of Entrepreneur

Referrals rule. And having an inside contact doesn't hurt either. That's the word from companies that have hired a technology solution provider--and those who provide these services themselves.

"I do everything through referral," says Margaret Holt, co-founder and president of Holt Learning, a training and employee development company in New York City. "And if I had to go on a cold-call basis, I'd ask for five referrals and I'd call every one of them."

The story of how Holt teamed with solution provider Jade Systems in Cold Spring, New York, is a case in point. When Holt needed a new partner, she remembered Jade had done work for one of her clients. Debbi Milner, Jade's co-CEO and president, also belonged to the same women's professional organization as Holt.

Milner says there are four categories that Jade's referrals fall into: those from long-time customers; those that crop up through the professional organizations to which Jade belongs; prospects from the technology education seminars it hosts; and recommendations from the product vendors Jade represents.

Lee Bartow, CIO for Charmer Industries, an Astoria, New York, wine and spirits distributor that also uses Jade, shuns cold calls-unless he has a specific problem. Like Holt, Bartow insists on plenty of references before he'll sign a contract, but he's willing to try a new provider on a small project. "If I can get someone in on something simple and see how they respond," he says, "then things can develop from there."

It all comes down to trust, Milner explains: "A solution provider is the equivalent of their lawyer, their accountant, their insurance agent."

Peter Busam, COO of solution provider Decisive Business Systems in Pennsauken, New Jersey, penned a white paper on selecting a good technology partner after noticing that many of his company's prospects had been burned by another IT consultant. Among the highlights of the paper (found at www.decisivebiz.com): Get references; beware the perfect, off-the-shelf solution; and ensure your would-be partner has the resources to handle your project.

Finally, price should only be one consideration. "Selecting a solution provider based on price is equivalent to selecting the cheapest surgeon," says Busam. "In the long run, the cost of a poor solution is more expensive than doing it right the first time."


Heather Clancy is the editor of CRN (www.crn.com), a newsweekly circulated to 117,000 technology solution providers, most of which are growing businesses.