Business Commitments — Is a Oral Commitment a Moral Commitment?

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“Take my word. You can straight away deliver the items and collect the payment within a week”.

Who said this? The proprietor of a small company, one of your regular customers, whom you know for the past 2 to 3 years. Can you take his word? Yes, of course.

What if the same words are uttered by a Purchase officer of a multi-billion business corporation? The answer is No. Why? There are plenty of reasons:

  • A big business corporation normally has a multi-tier decision making system. They will have well established systems, procedures and formalities to be gone through even in minor transactions.
     

  • The person who asked you to deliver the items may or may not have the powers to make the decision at his level. He might have over-acted to you just to exhibit his authority.
     

  • In these days of precarious job-security, all said and done, the person who asked you to deliver the items may not be sitting at the same seat by the time your delivery van reaches the destination!
     

  • The person, under his work pressure, may even forget having giving you such an instruction and if you were to act according to his words, he may even deny at a later time about having given any such instruction.

What makes people think that their words carry weight and expect others to act according to it?

a) To give a (true or false) impression that they are in-charge of the helm of affairs and that their written word is as good as a commandment.

b) They may be too lazy to carry out a procedural paper work at that point of time; they would postpone “going through the procedures” after the job is done.

c) They may be under tremendous pressure from their higher ups to get things done too fast. Under such circumstances, they try to cut across established procedures and at times end up in putting themselves and the other person too into trouble.

d) They may be extra-smart to hoodwink the gullible to get things done to their immediate favor, with the idea to face any bad consequences as and when it comes.

f)Lying and falsehood runs in their blood.

Naturally, one has to be cautious and use past experience and a fair sense of judgment before acting upon oral instructions. While making a request to “give it in writing” may be a safe option, diplomatically, it may not the best option always. One has to use tactfulness and some circuitous phrasings to make the other person commit his word in writing.

Smart businessmen, over a period of time, learn to tackle oral commitments with oral counter-commitments! For example, if the Purchaser who asked for a delivery based on his oral request calls up, the smart businessman replies, “We are already on the job” / “items are under packing” / “The delivery boy has suddenly fallen sick” and so on, till he gets the written order!

There are certain oral commitments that always have a dubious weightage. For example, the words of a Sales Person who promises “immediate delivery” for a currently scarce item; the production manager who says “The item is ready” but when you say you are sending your inspector to inspect the items, vehemently gives lame excuses to frustrate your inspector from coming.

In transactions involving lots of money, sometimes one has to even go even beyond a written commitment before proceeding with the work. For example, a customer wanting a Special Purpose made-to-order machinery is prepared to give a “letter of Intent” but not releasing Purchase order or paying advance, citing some procedural difficulties. One has to be very cautious in such circumstances.

We are presently in a world where everything seems to be urgent. Naturally, fly-by-the-night operators are also too many. Taking the word for granted can not be applied based on mutual trust as it used to be in the past.

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