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An Effective but Risky Strategy for Late-Paying Clients

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Project Infomation

I still did not receive my payment for month-old work. I’m kind of hesitant to speed up work on your project because I have several projects in progress and my priorities are shifted towards the paid ones. So a web developer emailed me the other day. By the way, we (my business partner and I in a web development venture) like her a lot: She is fast, professional, has reasonable rates, and does high-quality work.
Her email was in response to my asking her to give us a sense of when we can expect more project deliverables, as well as to ask if she could devote more time to our project.
  • Client : Insight Studio
  • Date : 20 Feb, 2018
  • Skills : Project Planning

Challenge & Solution

Her reply was a bit of a shock to us. We had paid her up front when we began work, and since put two checks in the mail. Apparently she had not received these two checks, which did not make sense. Also, while we knew she was awaiting payment, she never told us that she was on the brink of slowing down work on the project.
Grab the audience's attention
It got our attention. We scrambled to get her on the phone and resolve the problem. It used her leverage over us — our need to get work done.
Use the right strategy to call for action
We needed the project done, and so had some conversations about how to phase her out quickly (after all, we thought the check was in the mail). Her move could have cost her a lot of work.
Solve the issue in an appropriate way
She should have sent a warning first, so that we could have resolved the situation without taking it to the brink. After all, honest mistakes on both of our parts led to this problem.

Our Process

The above strategy got our attention, because we really wanted to accelerate progress on our project and, so far, she was our main resource (and design/usability is the bottleneck on this project). At the same time, it got us frustrated, too, because it came as a surprise given that we thought the “checks were in the mail.
01
Improve sales & operations & production planning
02
Determine the right inventory level
03
Optimize the supply chain for perfect order planning
04
Improve sales & operations & production planning

Result Driven

So, we called her immediately to find out how we could resolve the situation. When we did, we learned that she had moved her office without our knowledge, and so her checks were most likely being forwarded. After our talk, she did accelerate her work, and in fact exceeded our expectations (Credit: sitepoint.com)
Reduced lead time by 43%
Decreased variability by 50%
Lowered the risk of back-order by 95%
Increased stock for finished goods by 10%
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