Vexed Vendors

Computer Associates and Nortel Networks have faced a torrent of bad news and management turnover. How do you protect yourself when your vendor is in turmoil?

Computer Associates ousted its chairman and chief executive over accounting concerns. Ditto for Nortel Networks, which booted its CEO and chief financial officer. What will you do if your vendor hits turbulence?

It's a question worth pondering given April's executive high jinks, corporate housecleaning and financial restatements. Whether it's Computer Associates' horrid month culminating with the resignation of CEO Sanjay Kumar, or Nortel's latest accounting problems and the termination of CEO Frank Dunn and CFO Douglas Beatty, it helps to have a plan just in case a vendor unravels.

While CA and Nortel pick up the pieces, the chaos atop their organizational charts serves as a cautionary tale to customers who commit to any one vendor for key business applications only to discover executives at their most important supplier are law- enforcement targets or cleaning out their desks.

When a supplier is in trouble, customer service, support and the product pipeline can suffer.

Here are some ways to protect yourself.

For the rest of the story, click to Baseline.