April 6th, 2005 by Bob Bly
Are there certain industries whose business model is dependent on not helping customers?
Here are some that have been suggested to me by various people:
1. Insurance ? my late father, an insurance agent for five decades, once said, ?Insurance companies want to write fire insurance policies for pig iron at the bottom of the ocean.? They want to collect fat premiums for policies they will never have to pay off, and often make it difficult for policyholders to collect on legitimate claims.
2. HMOs and managed health care — see #1 above.
3. Psychotherapists ? if the psychotherapist quickly cures every patient in a few weeks, the lifetime value of each client diminishes drastically.
4. Stock brokers ? Wall Street is rigged against the individual investor. Brokers are told to push shares their firms underwrite, not those stocks that are the best investment. If the stock they recommend loses you money, they make commissions three times — first when you buy, then when you sell, and again when you put it into something else.
5. Advertising agencies ? have a financial incentive to sell you ad campaigns that are (a) the most elaborate and expensive (increases billings) and (b) win creative awards (which helps win them new business).
I don’t mean to imply that everyone, or even the majority, of practitioners in these fields are out to cheat customers.
I am just observing that there is an incentive inherent in each business model NOT to always do what is best for the customer (which a smart practitioner knows is canceled out by the business benefits of delivering superior customer satisfaction).
Would you dispute any of the above? Or do you agree wholeheartedly? Any other industries you?d add to the list?
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