When I was a young lad, I worked summers for my dad, a general contractor. It remains a long-standing source of irritation that I was never actually taught any transferable skills during my tenure with his company, but I did master the arts of digging, sweeping and carrying stuff.

In the years since, my Dad and I have found we have a lot in common. As business owners, we both deal with clients. But I think a lot of people wouldn’t recognize the similarity in our businesses: my Dad, a contractor, deals in “real things”, whereas my wares are purely virtual. When someone pays to have an addition put on their home, they can see the lumber and drywall that they’re paying for; these are physical goods that were clearly manufactured, shipped and assembled. Most people see the direct relationship between the money they pay, and the goods they receive.

When things get virtual, the relationship between money and goods becomes more tenuous. Where my dad makes something from nothing, I, well, make nothing from nothing. Web sites, logo designs, magazine articles and the rest of it are nothing more than bits on a computer. One has only to look at the proliferation of music and software theft on the Internet to appreciate the value that many people place on virtual goods.

But the truth is, my business is incredibly similar to my dad’s. Through the use of labour and materials, we both produce finished products to our customers’ requirements. And — here’s the key point — when changes are required, there’s always a cost.

Change management is a broad topic, and one that’s loaded with pitfalls. Here’s my best rule of thumb regarding change management:

The later in the project you request a change, the more expensive it’ll be to implement.

Simple! Here’s an example from a world most people readily get. Say you have an addition put on your house. You initially decide the fireplace will go on the north wall. But let’s say that later you change your mind and you want it on the west wall. When is it the cheapest to make that decision? Before a single brick is laid, naturally; and clearly, it’ll be most expensive when the job is done, and the whole addition has to be torn apart to change it.

So too with my work. But, while the construction example is laughable in its obviousness, the same isn’t true for me. When the physical result of my work is nothing, then it should be easy to get a new nothing, right?

Some people suggest that change requests are a good thing, since they increase the size of a project; ultimately, they put more money in my pocket. And this is true! Change requests happen for many reasons, many of them legitimate. For example, one client, for whom I was building a loan approval application, landed a huge client in the middle of our development process, and wanted the application changed to suit their needs.

But there are times when whim, misunderstanding or simple indecision become the culprits. When that happens, I sometimes can’t convince the client that a real change is occurring; ultimately I either have to give up a chunk of my compensation for the change request, or damage the good will that I ultimately value more than anything among my clients. Unfortunately, I can’t point to a fireplace and explain how tearing it out of a wall would add a lot of work!

Even so, I actually feel a bit sorry for my dad, because while most people can appreciate the costs involved in changing their mind, he still has clients who freely do so without regard for the cost. In my business, it’s getting easier and easier to accommodate change requests, because the tools for building web applications and designing graphics are getting dramatically better. Meanwhile, it’s always going to cost the same to move a hole five meters to the left.

I’ve done it, believe me.

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There’s something deeply wrong with the business world when companies make a practice of suing their customers. The most explosive example is the Recording Industry Association of America (RIAA), which has campaigned for several years to reduce music piracy by bankrupting its supposed perpetrators.

While those fortunate among us sit in Canada (fortunate, that is, in all respects save for the presence of the iPhone!), we can recognize that lawsuits are the blunt instrument that American corporations and people wield all too easily. But there’s something really smelly about going after the same people that keep you in your sports cars and shmancy suits. Logic dictates that you won’t be in business very long. And while the music market is sufficiently large that many people don’t connect the lawsuits with the music, as it were, there is now enough backlash from the public that some companies are backing down. When those lawsuits first started in 2003, many seemingly innocent people were targeted, according to this Washington Post article.

While one could argue that file sharing of music has decreased as a result of those lawsuits, there are also many people — myself included — who buy a lot less music now than they used to, as a direct result of the music industry’s practices. And now that some music groups are leaving the sticky embrace of their labels altogether to pursue their own fortunes (Radiohead may be the latest, with their latest album), I think the message is getting through: lawsuits may not be the instrument of choice for reducing file sharing.

But then we get this story about how the Business Software Alliance (BSA) is using RIAA-like tactics to strangle its customers for using unregistered software.

The BSA is a collection of companies, including Microsoft, Adobe and Symantec. These are some of the biggest software producers in the world, and they are using some of the shadiest strategies to pursue their agenda. As the linked article reads,

Of the $13 million that the BSA reaped in software violation settlements with North American companies last year, almost 90 percent came from small businesses, the AP found.

Sound familiar? The biggest companies suing the smallest customers. Perfect. But it gets better:

…according to an attorney who represents companies that have drawn BSA attention, it is the offers of huge rewards - upwards of $1 million - that creates an irresistible temptation for IT execs to rat out employers, especially former employers.

Let’s draw a picture: your company has a resident IT guy. He’s responsible for running your systems and tracking your software purchases. Then, for whatever reason, he leaves the company. The next week, the BSA has handed this former IT guy a bag of cash, and they’re delivering a lawsuit to you, based on the fact that this guy either didn’t do his job, or told a good story.

And the BSA’s war chest — used solely to reward disgruntled snitches from companies — is a dirty method indeed. According to the original AP story published today, there are many innocent companies who simply aren’t aware that they are violators.

It pains me to see the name of Apple Inc. in there with the Microsofts and Symantecs of the world. In all other ways they don’t act callously with software licensing (for example, they don’t use complicated and error-prone activation with their operating systems and other software).

So the takeaway here is twofold: if you’re a small business, take some time to track your software licences. But also consider moving to free software, such as Ubuntu Linux for the operating system, and OpenOffice for your office suite. Especially if you’re a Windows user. Any company that makes a business of suing its customers deserves to lose some business too.

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