Written by: Herbert Van Patten II
My neighbor recently embarked on an overdue kitchen remodel. After a little research on costs of material, labor and craftsmanship, he came up with a range for what the remodel should cost. He then obtained estimates from three different contractors. While two of the estimates were within the expected range, one estimate fell well below the range.
When I asked him which contractor he would go with, he responded that he didn’t yet know, but that he had eliminated one contractor—the one who provided the lowest estimate. When I asked him why, he shrugged and said, “I know what I want and there’s no way the contractor with an estimate that low would be able to deliver the quality of materials and craftsmanship I’m looking for…after all, you get what you pay for!” Whether or not he knew it, what my neighbor was referring to was a business principle called The Common Law of Business Balance.
The Common Law of Business Balance is a meditation on price and is attributed to John Ruskin, a 19th century English poet, art critic, prominent social thinker and philanthropist. If what you really want is value vs just low price, you would be wise to heed Mr. Ruskin’s words:
“There is hardly anything in the world that someone cannot make a little worse and sell a little cheaper, and the people who consider price alone are that person’s lawful prey.
It’s unwise to pay too much, but it’s worse to pay too little. When you pay too much, you lose a little money — that is all.
When you pay too little, you sometimes lose everything, because the thing you bought was incapable of doing the thing it was bought to do.
The common law of business balance prohibits paying a little and getting a lot — it can’t be done. If you deal with the lowest bidder, it is well to add something for the risk you run, and if you do that you will have enough to pay for something better.”
Or as Benjamin Franklin put it: “The bitterness of poor quality remains long after the sweetness of low prices are forgotten.”
This same principle holds true to ISYS’ approach to case management—we don’t aim to be the lowest-cost provider, but the highest-quality provider of value-based outcomes aligned with the needs of our customers.
Our customers come to ISYS not because we’re the lowest bidder, but because of the value they find in the quality and consistent delivery of case management they rely upon to achieve their claim goals and, ultimately, their success.
By taking this approach for over 24 years, we’ve been able to remain true to our philosophy—and indeed our practice—of doing business on a handshake. We take pride in the fact that our customers come to ISYS not because they must, but because they choose to. Every referral sent to us by choice is confirmation that we continue to get it right. And, while we may not be perfect, when our humanness shows through it’s the exception to the rule, the rule being that we get it right the vast majority of the time.
So, if successful outcomes is your aim, be careful not to lose sight of that by a short-sighted focus on low price alone…remember, you get what you pay for!