Wow, the title of this blog could go in some many different directions. I guess the one I am thinking about would be the people you hire to do jobs around your home. People like painters, carpeting, handymen, etc. I am working with an irrigation company today.
They showed up right on time, got right down to work and are making good progress. The first guy I called showed up at the wrong time. I was not even home. Did nothing while he was here and charged me for an hour and a half of his time. He was summarily fired.
Both companies were referred to me by people I know. The slacker by my neighbor, and the latter by a colleague of mine. When making referrals I always check back to make sure the company did a good job for my client. When I receive a referral and they don't work out, I make sure to tell the referrer, and I never use them again.
I little due diligence with referral companies can save you time, money and trouble.