Morgan Friedman: Hey everyone, welcome to the latest episode of Client Horror Stories. I’m very excited to have with me tonight the one and only Brad White. How are you doing?

Brad White: I’m doing fantastic. I’m glad to be here and just a little bit nervous to talk about flying horror stories. You know, I think anything great, you feel that little bit of nervousness in your stomach beforehand, which is a good sign of premonition. We’re going to have a great episode right now.

Morgan Friedman: Absolutely. And with that, let’s jump right in. Tell all of us about your most powerful, horrifying, best-line horror story.

Brad White: Well, I mean, the good news is we only have a few of these, so it’s not a normal everyday regular occurrence. But when we have them, it’s not good.

And just a little bit of context for folks, because otherwise some of the terminology that I might be using might be kind of alien. Our company is VARC Solutions. We do everything QuickBooks. That’s an accounting software program that a lot of small business owners use.

And so not only do we do the bookkeeping and consulting, we also do migrations. Migrations are kind of like one of the hardest things to do in our space because even though some people have been using QuickBooks on the desktop side of the platform for a long time, a lot of them are moving to the cloud. So they’re moving to a cloud version of QuickBooks.

And even though they both say QuickBooks, they’re very different. The desktop and the cloud are very, very different.

So when somebody’s trying to migrate from desktop to online, you can’t just click a button and have it be done. Or at least that doesn’t happen normally, right?

We usually get the call when they’ve tried to do the migration themselves and it just didn’t work. So they’re calling us up and they’re relying on us to be the experts to guide them, advise them, and then also do the work to get them from the desktop to the cloud.

And as part of that process, when we have chats with our clients, we tell them, “Here are the things that can go wrong. Here are the ways that this project can go sideways.” And then let them make the decisions: “Do you really want to do this or do you not want to do this? Because here are some problems.”

Well, invariably, when we do these projects, they do go sideways.

For example, we do the types of migrations where we’re taking data out of an existing file and moving it into another place. That usually involves things like your customer list, the people that have been paying you, the vendor list, the chart of accounts, the products and services that you sell.

Those are the easy things, and we do those all day long.

But a lot of times people have been using QuickBooks for a long time, and so they want all of the last 10 to 20 years’ worth of history in their file that they’ve been tracking. They want that moved to the cloud.

And the short story is, it’s always a little bit of a mess. It sounds simple, right? Just get the data out, get it in this new system. But it’s always a mess because the two systems are very different.

Morgan Friedman: By the way, I just want to have two footnotes in there.

First, the fact that it is always a bit of a mess is a reason why you have a business. If you were just, “Oh, click and it works,” no one would ever need you.

Brad White: It’s a great point. We are in a business because we’re experts at this thing.

QuickBooks has actually gotten to the point where they’ve intentionally made the online product different. When QuickBooks Online came out, they had the option to make it look and feel exactly like the desktop version. But they said, “Look, if we do that, we’re not going to be taking advantage of the cloud capabilities.”

If you’re literally just running the same thing in the cloud, you’re not using the cloud like it’s meant to be used.

It’s just like having an app that ran on a server and now you’re trying to use it on a mobile phone. If they made it exactly the same, you’d be like, “This is terrible.”

So they intentionally made the online product different because they thought they could make it better and more cloud-capable and cloud-centric.

But they created a problem for themselves at the same time because the software is very, very different. It looks different, feels different, it has different functionality. Literally, there are features that are in one that don’t exist in the other.

And when we hire bookkeepers to work for our company, we ask them the question, “Do you know QuickBooks?”

They’ll say yes. Or no. But obviously, they’re trying to get a job, so they’re going to say yes.

So we’ll ask them, “Have you used QuickBooks Desktop and also QuickBooks Online?”

And of course they’re like, “Oh, yeah, yeah, absolutely.”

And I’m like, “Well, do you like one versus the other?”

And they’re like, “No, I like them both. I mean, they’re exactly the same.”

And when they say that, that’s telling me that they don’t really know the software.

Morgan Friedman: Red flag.

Brad White: Yeah. It’s kind of funny. Your subtle trick question.

When you really know the software, it’s easy to catch people that are just trying to put on a good face.

But back to the story.

When we have these conversations with clients and they want this history, they want the last year, two, three years’ worth of history, we tell them that if we do this for you, it’s going to be a mess.

Literally, there are features that you’re using that don’t exist in this new software. There’s just no way to match up years and years and years of data by simply importing separate parts and then trying to magically make them all match up.

It’s very complicated.

And so we tell them, “We don’t recommend this. We don’t want to take your money and do that. We would rather do it the right way. We’d rather tell you how it’s supposed to work and do it the right way, and then get you up and running very, very quickly so that you can start this new system and go forward.”

But a lot of them just have this notion that, “No, I need to have the history.”

Morgan Friedman: And it makes sense.

So just to be clear, when you say you recommend doing it the right way, what you mean is start from here forward on this system?

Brad White: Yeah, exactly. Start from here and go forward.

And we make sure that the before-and-after balances are the same. If you ran a P&L on both sides, they would match. If you ran a balance sheet in both systems, they would match.

There’s just no underlying history to support those numbers other than the entries that we made.

Some people just want to be able to run a report from five years ago, drill down into it and see the invoices, the payments, and the deposits.

And we’re like, “Yeah, you don’t really want that. I know you think you do, but you really don’t.”

So we advise clients against it.

But again, a lot of times those clients are being told by someone else that, “No, we have to have it.”

And so invariably we’ve done these projects sort of against our recommendation.

And almost—not always, but in many, many cases—it ends up becoming a nightmare for us because the customer ends up blaming us that we did it wrong or that we were incompetent.

Like, “We just didn’t know what we were doing.”

Because if we knew what we were doing, it would have been perfect.

But we tell them upfront that it’s not going to be, and it’s going to be really, really costly if they want us to do this.

So in some of the scenarios that we’ve had with clients where we’ve done this work, we’ve done the work, it’s taken 20, 30, 40, 50 hours of manual data manipulation to get this thing working.

And then at the end they’re not happy because it is a mess, like we told them it was going to be, and then they don’t want to pay us and then they give us bad Google reviews.

Morgan Friedman: And there’s a real hard thing you threw out as a side comment that’s worth calling out.

You said sometimes we recommend against doing it, but we do it anyway when they insist.

I know nothing about QuickBooks, so every industry is different. I’ve found that when you give strong recommendations to clients and they go against it, it always goes badly.

So it’s much stronger to be like, “This is the way we do it. And you want to do something completely different? Go with someone else.”

Brad White: Yeah. And I know one of the things that you like to talk about on the show is, what’s the lesson that you learned?

What did we learn from doing that?

Well, maybe we’re a little hardheaded when it comes to this, but we have learned to do that. We’ve learned to basically say, “We’re not going to do that.”

But here’s the funny part: we’re a small business. We’ve been in business for, I guess, going on 26 years. And so we do feel like we know what we’re doing here.

But we’re not always talking to the owner of the other business.

Sometimes we’re talking to an office manager. Sometimes we’re talking to an employee. Sometimes we’re talking to somebody else who doesn’t necessarily have the authority to make those decisions.

And that can create a whole other set of problems.

Morgan Friedman: So are you accepting bids from anybody you’ve ever worked with before?

Brad White: Exactly.

Morgan Friedman: Well, how about this: work with them and let me know if it works. If it doesn’t work out, give me a call.

Brad White: Exactly.

Morgan Friedman: That’s crazy.

So I love the context and this general complex situation that you’ve described where companies want this, but they really don’t. We’ve already gotten a few lessons from that.

Does a specific incident come to mind where this happens and it was particularly painful that you might want to talk about, so we can extract some even more specific lessons from it?

Brad White: Yeah, for sure.

We’ve had several. It’s not as common—I mean, we have very, very, very good Google reviews—but just like with any company, there are a few that are like that that didn’t go well.

One of the other scenarios that we had was, again, it typically revolves around this migration process because normal QuickBooks consulting, when you’re an expert, it’s really not that hard. It’s not hard for us. We do it all the time.

These migrations, especially when we’re leading people through a process that they’ve never been through, that’s really the hardest part.

So there’s another one in particular where we were doing a migration where not only was somebody migrating from QuickBooks Desktop to QuickBooks Online, but in addition to that, they were also trying to implement a different CRM system.

Morgan Friedman: Wow. That’s crazy high risk, doing two migrations on the same set of data at the same time. That’s like a ticking time bomb.

Brad White: I guess we’re gluttons for punishment over here.

Well, to be fair, we weren’t doing both concurrently. They were two steps. It was like migrate to QuickBooks Online and then connect the CRM system.

So they were very closely tied, very closely related, but not exactly at the same time.

We started working with a particular person at this company. They were the ones that we had the conference calls with. They’re the ones that we mapped out the project with. They’re the ones that we had all the conversations with.

“Okay, this is what we’re going to do. This is what we’re not going to do. This is how long it’ll take,” etc.

We quoted, did all the due diligence, and did all the process with this one person that we were being told was the primary contact—the only person we needed to speak to.

And invariably, it’s a similar problem.

We did the migration. There was historical data that was trying to be merged over, and again, it wasn’t a clean export or import.

Another little side topic: one of the other things that I think a lot of people in this space don’t realize is that we’re not just migrating what we might assume to be clean data from one system into another system.

Not only are we migrating from one system that’s vastly different than another system, but the data itself can be variable in how clean or dirty it is.

You can imagine, let’s say you’re a business and you’ve been maintaining your own books.

One set of books has been well maintained. The coding is correct. You’ve recorded things for the right income accounts and accounts, the accounts receivable, accounts payable—it’s all right. You’ve reconciled your bank accounts and credit cards.

Okay, that’s a fairly clean set of books.

Another completely different scenario is where the coding is not right. AR is already wrong before we even try to import it. The accounts have never been reconciled. They’ve never reconciled their bank account. They’ve never reconciled their credit card account.

So in this particular situation, it was more of the latter, where the data itself was also not pristine.

But we were being asked to import it.

And so, same thing, same story. The end result is we were able to migrate them over. The data that they asked us to import, we imported.

It was a little bit of a mess.

Interestingly enough, the person that we had talked to, they weren’t the ones that were having all the problems. It was actually other people on their team that then blamed us for being incompetent because the data was so messy.

Like, “We imported this data and they’re like, ‘We can’t use this. How are these people in business? Because they couldn’t even migrate our file over with all this data that we asked them to.’”

They weren’t even part of the conversation where we told the primary contact that this was not a smart idea and that it was going to be a mess.

So then they blame us for creating a mess as if we were just bad at the migration, which is not the case.

Morgan Friedman: That is interesting, because part of the problem there is the warnings about the bad data, for example, you would have given to your contact, but the contact didn’t pass them on to everyone else.

And in real life, like the game of telephone—the children’s game of telephone—is endemic. It happens all the time.

And of course, the middle person will not pass on all the footnote risks and details. They’ll just be like, “Here’s the URL. Go try it.”

So it’s actually an interesting question about how to minimize these sorts of risks.

Something I’ve done in the past is when there’s this middle person, and I know there are people that they’re communicating with that I don’t have access to who need to know things, I would often do things like write one-pagers with the important details and, in big red letters, the warnings.

“Hey, here’s an intro guide. Please pass this to everyone on your team.”

And sometimes they do. Sometimes they don’t.

But it’s an attempt to minimize that risk.

Brad White: Yeah, for sure.

And one of the things that, again, I think we’re still learning, right? We’re still learning this lesson, and it’s hard to know for sure before you get into something like this.

But there’s that concept within sales that you need to make sure that you’re addressing all the needs of all the different stakeholders.

Okay. Well, who are the stakeholders?

You’re not working in a perfect system where you know all the stakeholders.

And that’s why it’s like, “Okay, well, I need to have a conversation with the owner because I know that owner is a stakeholder in the outcome of this thing.”

They’re the one that’s going to be super, super unhappy if this takes a long time, costs ten times as much as they were hoping it was going to cost.

So I want them in the room. I want them in the conversation.

There are other people that, again, they may not have time to be in those initial conversations, but they need to be.

If I’m not talking to the CFO, if I’m not talking to the owner, if I’m not talking to the CPA who is going to then look at those books later in the year to do taxes, it’s like, who are the people?

So I ask my team, “Who are the people that are going to be the most upset if this project goes south?”

Those exactly are the people who need to be on those initial calls.

And if they don’t have time, let us know when you do have time, because otherwise we don’t need to have this conversation.

So getting the stakeholders in the room is part of our process. It’s part of what makes it work.

But again, if we don’t know that there’s another person who’s going to be upset and they’re not being brought into the conversation by their team, it’s really, really hard to know without saying, “Okay, well, who else should be in here?”

Okay, yeah, we got John.

“Who else?”

Susie.

“Okay, great. We got Susie. Anybody else?”

“Well, no. Maybe Betty needs to be.”

“Yeah. Okay, Betty. Anybody else?”

How many times can you ask that question before you feel like you’ve got the right people in the room?

And in this particular case, again, we didn’t have all the people in the room.

The lady in particular that we were working with, we basically said, “Hey, these two systems are very, very different. A lot of times there’s a learning curve to get up and running with this new system. Would you like us to also train you and your team in the system?”

And the answer is, “Well, I think we can do it on our own. We know we can’t afford that. We’ll just do it on our own.”

So in this particular case that we’re talking about, not only was the data messy and they blamed us, we also got a couple of bad Google reviews from other people on the team that we never spoke with, never ever had a conversation with, that blamed us for basically migrating them and then disappearing.

“Like, how could you migrate us and not teach us how to use this new system?”

People on your team told us not to. They said that they didn’t need it, that they didn’t want it, that they couldn’t afford it.

But again, we’re getting blamed, and now there’s a bad Google review out there from somebody who blamed us for a decision that was made within the organization.

That’s really, really frustrating.

And again, our response to that was, “Hey, I’m sorry. I don’t even know who you are because we haven’t talked to you. But we’d be happy to train you. Here’s my name, here’s my phone number, here’s my email address. If your company authorizes us to train you guys, we’d be more than happy to.”

But again, it’s like there’s a reaction because there are a lot of assumptions being made about what was or wasn’t agreed to.

Here it is: we’re the ones taking the hit for it.

Morgan Friedman: One of the challenges of broken telephone is, yeah, sometimes people just don’t pass along the information because it’s complex.

Data normalization is actually a complex concept for normies.

But there’s another side to it.

Sometimes they break the telephone chain on purpose because they didn’t want to spend the money for the training, so they told you not to.

But to the internal team, they don’t want to say that. They don’t want to look cheap to the internal team.

So it’s much easier to blame the vendor.

Brad White: Yep.

But what’s interesting about this is, again, I think we’ve gotten better at this. We’ve learned through trial and error some things that we should be doing differently, some things that we need to be communicating more effectively, getting the right people in the room.

But I think one of the overarching things, and you kind of alluded to it, I think you might have actually said it, but I think one of the things we’ve learned is sometimes it’s okay to say no.

We’re not going to do this project if you’re going against our recommendation when we’re the experts.

Morgan Friedman: So, doing a migration, is there ever a time where you do recommend it? Like maybe you shouldn’t even offer it if it’s so risky?

Brad White: Yeah, it’s a hard thing. It really, really is a hard thing.

Because again, quite frankly, some people are like, “I mean, we need this. We’re not going to have access to our old data.”

Sometimes people are paying for systems that cost tens of thousands of dollars. If they’re migrating from a Sage product or maybe a NetSuite product, those are very expensive products and systems.

And once you stop subscribing, they cut off your access.

So if you’re migrating from another system that you’re going to completely lose access to and you’re trying to move to a new system, it makes sense. You want your history. I would want it.

If I was the owner and I had no idea how these things worked, I would want it too. I would absolutely want it.

I want to be able to see ten years’ worth of sales history. Why not? Why wouldn’t I want that?

But in those situations where they’re not going to have access at all to the historical data, we can mitigate that.

We can say, “Hey, well, before you migrate, let’s go run a whole bunch of reports on those prior years. Let’s run the reports. Let’s send them to Excel or let’s PDF them so we can have them if we need to look them up.”

But just not have it in your live QuickBooks data set going forward because there’s just so many reasons why you’re probably not going to be happy.

But we’ve learned that, okay, if you want it, let’s get it a different way.

Or let’s maybe have a local copy of the company file that we can maintain on our server, and if you ever have any questions, we can go pull it up on our system, but maybe not have it live in the cloud.

Morgan Friedman: I love your solutions and your attempts to mitigate it. They’re great.

It’s interesting because it’s a very, very subtle thing because this comes down to these sort of data normalization issues.

I know absolutely nothing about QuickBooks, but I’ve seen this type of issue in other spaces.

I can already imagine, “Oh, in this one there’s an optional field, but when you’re moving to it, it’s required, so therefore all these are going to break.”

So I understand that.

But had I not worked in software and enterprise software development, those would have just confused me. “No, why can’t you just make it work?”

Brad White: Yeah, for sure.

And it sounds like you got a little bit of a data background, and I do too. I graduated with an MIS degree way, way, way back a long time ago, and so I know all about fifth normal form.

I know that stuff. I know about databases a lot.

Thankfully, I’m not a programmer anymore. That was a long time ago. But I understand the concepts.

And yeah, you can’t make bad data into good data.

If you’ve got disconnected or redundant data all over the place and you try to move it to another place, it can be really, really messy.

So it’s a little sad that the systems aren’t exactly just plug-and-play, exact two opposites of the same coin. They’re actually very different.

Morgan Friedman: Interesting.

One of my favorite techniques to help kind of mitigate these sorts of problems is on the internal systems with the users to have huge warnings, huge banners.

Because if there are risks like this, you have to hit people over the head.

But in your case, I don’t even know how feasible that is because QuickBooks is not custom software. You can’t add your own pop-up into QuickBooks.

Brad White: Yeah. You can do some subtle things with the actual data, but not necessarily the features that the data is sitting in.

For example, in the chart of accounts there’s income and expenses. It’s not uncommon for companies to have redundancy within the expenses when there shouldn’t be.

QuickBooks is very flexible, right? You can just go and create an account on the fly, even if you’re not the accountant.

And so it’s not uncommon to have a little bit of a mess like that.

So you could create an account that says “Always use this.”

Or “Office supplies—don’t ever use.”

That’s the name because that’s what you can put text in versus being able to put a pop-up on a screen that says, “Don’t do this.”

In fact, it’s interesting. QuickBooks has actually gotten kind of cute in that respect because I think they know that normal people are using the software versus true accounting people.

Let’s say you wrote a check, you paid a bill, you made a deposit, and then you get your bank statement.

You reconcile your bank statement and you’ve basically checked the box that says all these transactions are on your bank statement. You cleared everything. It’s done.

Well, then two months later, you pull up that check by accident or maybe you’re looking at it and you’re like, “Oh, this shouldn’t be here.” And you try to delete it.

That would be bad, right? You don’t want to delete something you’ve already reconciled. That’s just a no-no.

QuickBooks will pop up this thing that says, “You really shouldn’t do this.”

“You really shouldn’t do this because if you do, here’s what it’s going to mess up, and you’re going to have to redo the reconciliations.”

But, okay, if you want to click this button, right? Or type in, “I’m sure.”

So it has some of those kind of cute little pop-ups to let you know that you really probably shouldn’t be doing something.

Morgan Friedman: I hadn’t known that little detail, but I think it’s great because too often as companies become big, they take themselves too seriously.

I appreciate that they can at least use these cute little fun updates.

Brad White: Oh, you want another one?

One of my favorites goes back probably about 15 years ago. The company I was working for, we were doing internal technical documentation for QuickBooks. We were part of the people that were helping make sure the help system was good.

Like, you know, you hit the F1 key—

Morgan Friedman: Please. I love rabbit holes.

Brad White: And that’s one of the things I really enjoyed about working with QuickBooks. There was a lot of thought put into making sure people could actually understand the software.

And that’s really important because, at the end of the day, people are using these systems to run their businesses.

Morgan Friedman: This has been a fascinating lesson on QuickBooks, data normalization, users, and how do you let the non-specialists know about these things.

Any final thoughts, comments, wisdom, wrap-ups of the stories?

Brad White: I’ve got a few more. One more in particular that I think is really, really helpful.

One of the interesting things about being in a business, and in a small business in particular, is if you’re IBM and one of your customers doesn’t pay you, you might notice it if it’s a really big project.

But in small business, any non-payment can be a big thing.

Morgan Friedman: Totally.

Brad White: So if you’re making a million dollars, or five million, or twenty million, and you do a $20,000 project and you don’t get paid, well, you’ve already paid your employees. You’ve already paid your team.

And so not getting paid can make a difference.

As a small business owner, and we work with a lot of small businesses that feel the pain even more than we do sometimes, not getting paid really, really hurts.

So one of the things that I’ve learned in small business is it’s easy to get paid via credit card.

Somebody can pay via credit card. You invoice them and they pay via credit card. Super easy. It’s super fast.

There are fees that you have to pay and all that other stuff, but it’s a really good way of getting paid.

The problem is these things called chargebacks.

Chargebacks are the bane of existence when it comes to a small business.

If you go out and let’s say you bank at Wells Fargo and you get a Wells Fargo credit card, it doesn’t matter if it’s a personal card or business card.

You use that Wells Fargo card to pay for something—anything, product, service, whatever.

All you have to do is call up Wells Fargo one day and say, “I didn’t authorize that charge,” or “I don’t recognize that charge,” or “This company did X, Y, and Z, and that’s not what we agreed to.”

Well, you know what Wells Fargo’s immediate response is?

“You’re right.”

They take the money out of the account that that money was used to pay.

So when we get a chargeback, the bank that ultimately paid us on behalf of that client takes the money out of our account and then a two-to-three-month process starts to try to get our money back.

It took five seconds to get paid, but that one payment, if the customer ultimately does a chargeback, could take two to three months to resolve.

And again, it doesn’t happen all the time. But we have those clients where we’ve done the work, everybody said, “This is great. We’re happy.”

Months later, we get a chargeback.

They take the money out. No questions asked.

They basically say, “Hey, you’ve got 15 days to dispute this.”

Okay, great.

So we then have to go get all the documentation. We’ve got to waste countless hours of time trying to recreate what happened and prove that we actually did the work.

And even then, even when we have all the documentation, it’s really, really hard to get the money back because Wells Fargo doesn’t have a relationship with us. They have a relationship with their cardholder.

Morgan Friedman: Exactly.

Brad White: So, like I said, we’ve learned a lot of things. We’ve made mistakes, but we try to get better and smarter every day and every year.

Morgan Friedman: My final comment on chargebacks would also be, I’ve known or interacted with a bit too many people that purposely take advantage of chargebacks.

It’s one thing to be like, “Okay, no, we were unhappy.”

It’s another thing if it’s ambiguous, maybe, maybe not.

But there’s this universe of people there that buy things like, “Okay, okay, I’ll do the chargeback. I’ll get it for free.”

Because customers love credit cards, and AmEx is the king of this, where they know they’ll get the money back. They know they’ll win no matter what.

And, “Oh, if the customer is always right, I could just be a little bit annoying and then do a chargeback.”

I’ve even known a couple of people that threaten to do chargebacks.

Brad White: Yeah. People are crazy.

It happens. It’s just like anything, right? There are people in the population who will take advantage and people who won’t, and there’s a whole bunch of people in the middle who aren’t even thinking about it.

But it’s the bad ones that cause the problems for the good ones.

Morgan Friedman: This whole podcast is about helping people identify the bad ones, deal with them, and preempt it.

So, if anyone listening is considering starting a business and taking credit cards online, be careful about the people who put in chargebacks or take advantage of those.

Brad White: Yeah. Or get a piece of paper that says, “I authorize you to charge my card for this project. I understand that there are no refunds. I accept full responsibility for the outcome.”

And then when the thing is delivered, have them sign something at the end that says, “I approved the work. It was perfect. I accept responsibility going forward.”

Have it so clearly in writing that the customer was happy and approved everything.

Maybe before you deliver a final product or whatever it might be.

Because that’s really what it takes, almost that level of documentation, to win a chargeback.

Morgan Friedman: I just a few hours ago was on the phone with an Argentine friend of mine, and I taught him the amazingly useful phrase CYA.

And just having a whole bunch of best CYA practices goes so far in helping minimize a lot of client horror stories.

Brad White: Yep. Very true.

Morgan Friedman: And with that, Brad, it’s been fun getting to know you. I loved a couple different stories. I loved learning all about QuickBooks and their fun pop-up messages and chargebacks. This was great.

Brad White: Thank you for your time for coming.

Morgan Friedman: Absolutely. Thanks for having me on the show. It’s been fun.

And everyone watching, we hope you’ve made it here to the end, and we hope that you’ve enjoyed it as much as we have.

Until next time.