Thursday 9 March 2017

The value of a name

I took a young trader to one of the most reputable antique dealers that I know, hoping that the old dog would teach the young puppy some tricks. 

He did.

For my very first question I asked the master how important reputation is to a trader?
His answer was emphatic and immediate: "You name is EVERYTHING!"

I made a mental note not only of what he said, but the passionate way with which he said it.

What he said sums up what you will read in volumes of business books. Yet, it is still old news. If you read the Bible, you'd have heard that message 3,000 years ago already. Earlier than that, even, if you understand the Golden Rule:

"A good name is to be more desired than great wealth, Favour is better than silver and gold." - Proverbs 22:1.

Wednesday 8 March 2017

I bought no insurance today

I bought no insurance today.

I received a call from a very friendly girl who asked if she could talk to me.

"How may I be of assistance?" I responded cheerfully....

She said she knew that I was busy and didn't not want to take up too much of my time.

"That's all right," I said, "how can I help you?"

She ignored my question and in stead asked me how I was doing?

I told her I was fine and once again asked politely what I could do for her?

She said she wanted to discuss my financial future and wanted to know when we could set up a meeting?
That was a bit too fast for me.I told her anyone is more than welcome to visit me, as long as they don't come to talk about insurance.

She asked me why, so I asked if I could tell her a story. She said yes. I told her a shortened version of my story, and to my surprise - she listened.


Many years ago, when my father was in his early thirties, an insurance salesman called at our farm. When he introduced himself and my father told him who he was, the salesman blanched. He apologized and said he was new in town, and his superiors had warned him whatever he did, not to call at the farm of Carl Labuschagne, because "that man shoots Sanlam agents..."

My father wouldn't have shot anyone, but there was no way he was going to buy insurance from the same company again. Country folk are known to be hospitable, however, and my father was a gentleman. In stead of shooting the salesman, he invited him for tea and then to lunch. 

The salesman made no sales that afternoon, but after a couple of hours of conversation, he certainly made a friend.

There was a story behind the story, of course. Some years before that another salesman had called at our farm and convinced my father that he needed trauma insurance. Just in case he contracted a life-threatening disease which would leave his family unprovided for. My father thought it sounded like a good idea so he signed the forms and dutifully paid his premiums.

Then he was diagnosed with cancer. The most optimistic doctor of his team told him he probably had three more months to live. It was devastating news. The one thing he did not have to worry about, at least, was the financial security of his wife and small children. The insurance clearly covered cancer, and it would be more than adequate to ensure a carefree future for his family.

When he went to have the forms filled out, the district surgeon told him it was no use. He said he had a stack of claims this high, all with the same company, and all of them denied. "One way or another," he said, "they will find a way to disallow your claim. They always do."

It was no different in our case. The assessors searched until they found in my father's pharmacy records that he had taken high blood pressure medication. Upon this discovery the claim was summarily dismissed.

Fair play to the smart attorneys who write clever contracts of a kind that country farmers either do not read or do not understand. I don't know whether they were justified or not. Perhaps, in a strict legal sense, they may have been within their rights. 

All I know is that it saved the company a lot money and that according to the doctor it happened every time. But I think it also cost them a lot. In money, for one thing, but also in something that was more valuable than money.

My father told his story to many people over many years, and I'm fairly sure it left a lasting impression on existing and potential future customers. But that's now what it was about. Looking back now, I can see that there might have been an element of design involved.
Perhaps this trial was really a blessing in disguise, because now my father had the terrible knowledge that his family would not be provided for. 

And so he fought with all the strength he had to stay alive. And he beat his deadly prognosis by living 27 precious extra years. Perhaps he would not have fought so hard if he had thought that his family would be financially OK after his death? Even bad things happen for good reasons sometimes.

I gave the sales girl a very short overview of my story. The quietly said she understood, politely thanked me for my time and said good bye.

I thought about it for a long time afterwords, and perhaps so did she. She had no face to me. She was just a friendly girl with a friendly voice at the far end of a copper cable. I did not want to hurt her. Another human being trying to make ends meet in our cannibalistic world.

One of the lessons that I have learned about business is that when business starts getting hot and the money is rolling very fast, it all just blurs into a whirl of numbers. It's all just about the bottom line. About saving cost, and punching profit. You forget that behind funny money there is always real people.

27 years with cancer in the family taught me that no matter what the numbers say, business is really just about human beings. Frail, fallible people with hopes and dreams and friends and family who just want to get by as best they can.

If we lose sight of the things that really matter in business, we lose far more than money. We lose the precious element which makes us human.

A friend of mine who works for another big insurance company told me they have an entire department whose sole purpose is to find ways to get out of having to honour insurance claims. 

He told me how many millions they manage to save this way every year. They set goals and strive to break their own records. They are proud about what they achieve. To them it is just another game. It is all just blur of numbers. They have lost sight of what genuine business really should have been about. Long-lasting relationships with long-lasting loyalty.

This story involves insurance, but it could have been about many other kinds of business as well. It is not about the individual case, but about the principle that it illustrates. Undermining our own humanity in an effort to maximize profit is as old as mankind itself. It can be found in law, in politics, in medicine, in education, in banking - and yes - also in insurance.

When we are playing with money in our playpens, like toddlers in a golden sandpit, we would do well to remind ourselves that we should always handle our customers with great respect and tenderness. Their lives are far more fragile than we think. Numbers are important. But people always outweigh numbers.

For a while I felt sorry that I told my story to the young telesales girl, wondering whether perhaps I had upset her morning. I didn't mean to hurt her. But even so, perhaps it was a good thing to remind myself - more than her - that we should not hurt people in the way that we do business.

My business partner often used to say, "birds fly, fish swim and human beings...? Humans f-e-e-l. Because that's is just what they do."