P.V. Technologies Inc.

by: Frank V. Cespedes and Diane Badame

What to do in this race?

PV Technologies, Inc. is an industry-leading manufacturer of photovoltaic inverters used to convert the direct current output of solar panels into alternating current for the commercial power grid. In conjunction with a request for proposal, the company's largest customer performs a routine evaluation and ranks PV Technologies third behind two key competitors. The director of sales and marketing, Nathan Rubenstein, must weigh the possible consequences of the report on the company's reputation while considering an appropriate response. They believed that they were going to close the bug deal because they had a very good relationship with Solenergy's senior manager through their best Sales person. However, this was not the case. PV's best salesperson, Jim Salvatori, then had four alternatives from which to choose in response to this publication:

• Offer to extend the original warranty at internal cost from 10 to 20 years.
• Offer a 99% up-time guarantee at no cost.
• Accelerate the introduction of their new 1.25MW model and 98.5% efficiency.
• Salvatori approaches Solenergy's Morgan about results and persuades continued business.

Lessons Learned

• Improve Communication: I believe that one of the biggest contributors to PVT not being the top option for Solenergy is their poor communication. In today's market, it is all about the customer and knowing what they want, how they want it, and why they want you. They need to be able to approach their customers and not get information from a third party. Knowing that your best sales person has a good relationship with that company, does not mean that they will go for your company all the time. 
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• Make sure to make the right decision: PVT was very alarmed when they found out that they were ranked third in Solenergy's decision; this coming from a third party. They wanted to maintain their reputation and relationship with them, but there is no need to rush with their decisions. Extending the warranty and accelerating production of new products may be very costly, and smart decisions need to be made. 
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• The source of information is not reliable: PVT is worried about their reputation, however, they are willing to act on information that was unethically provided to them and did not come from Solenergy. This may raise concerns about the ethics of the company and hurt them more. 

Best way out? Accelerate the introduction of their new 1.25MW model and 98.5% efficiency. By developing and introducing this new product, which might be appealing for Solenergy, PVT can regain its top standard and reputation, and possibly close the deal with them. However, they need to think of a way in which the acceleration of this product will not hurt them financially and and can still be delivered to Solenergy on time. 

Solenergy's Point of View

From the customer's point of view, it is understandable to go with he best option that they think will generate them the most power, but at the same time lowering the costs. As CEO of Solenergy, I want to invest my money in the company that will satisfy my needs and as of now, PVT is third in our list. We haven't made a final decision yet, but we are still analyzing and looking into all the options that we have. I believe that they are a very trustworthy company, but I want to see more from them. I want to benefit more from a bud deal that we are trying to get here.