Friday, September 4, 2009
Thursday, September 3, 2009
Lack Of Business Sense In Our Industry
Ironically, you would think that a disaster response company, or recovery company would be a well oiled machine. It is amazing to me that there are so many of these so called, "When you need us, we will come" types of companies out there who themselves seem to not understand good business practices.
It is amazing in my studies and viewing of many disaster recovery companies, how many are so lost when it comes to even developing a business plan and giving their company players direction. The amount of "running by the seat of your pants" thinking which takes place is amazing. I do not wish to under estimate the great skill that many of them have to adapt to unfortunate situations. However, the amount of wasted effort, time and money is due to many of these companies not being solid from within.
I would have to say that I believe that over 87% of those companies out there who profess to be disaster response and recovery companies, do not have a strong business plan in place. Being in the "inner circle" of this industry I have seen how there is a large revolving door within these companies as it comes to holding long term employees. Many good people are used, abused and used up by companies whose main focus is, "the bottom line".
Having a strong economic engine is a must to run a company. However, there needs to be some business maintenance and mechanics which support the running of that engine, or it will bind up itself. Giving guidance and direction is vital to the success of any company out there today let alone the disaster response and recovery industry.
I am amazed that even the 90 day review is misunderstood and in many cases ignored in the DRR industry. Instead of looking at the 90 day review in the light to see if everyone is on the same page, and the company ideology is understood, it is looked at as a time to give a raise. That was not the purpose of the 90 review. It was to make sure that the employee has clear direction and understanding as to his or her responsibilities. It is also a time in which an employee can bring to the table insights which they have to make the company even better for the client.
Some of these companies have great marketing and little claymations and neat tag lines. However, internally they are a disaster themselves. This will effect the bottom line for the client and the time frame as to getting things back in place in a timely manner.
It is amazing in my studies and viewing of many disaster recovery companies, how many are so lost when it comes to even developing a business plan and giving their company players direction. The amount of "running by the seat of your pants" thinking which takes place is amazing. I do not wish to under estimate the great skill that many of them have to adapt to unfortunate situations. However, the amount of wasted effort, time and money is due to many of these companies not being solid from within.
I would have to say that I believe that over 87% of those companies out there who profess to be disaster response and recovery companies, do not have a strong business plan in place. Being in the "inner circle" of this industry I have seen how there is a large revolving door within these companies as it comes to holding long term employees. Many good people are used, abused and used up by companies whose main focus is, "the bottom line".
Having a strong economic engine is a must to run a company. However, there needs to be some business maintenance and mechanics which support the running of that engine, or it will bind up itself. Giving guidance and direction is vital to the success of any company out there today let alone the disaster response and recovery industry.
I am amazed that even the 90 day review is misunderstood and in many cases ignored in the DRR industry. Instead of looking at the 90 day review in the light to see if everyone is on the same page, and the company ideology is understood, it is looked at as a time to give a raise. That was not the purpose of the 90 review. It was to make sure that the employee has clear direction and understanding as to his or her responsibilities. It is also a time in which an employee can bring to the table insights which they have to make the company even better for the client.
Some of these companies have great marketing and little claymations and neat tag lines. However, internally they are a disaster themselves. This will effect the bottom line for the client and the time frame as to getting things back in place in a timely manner.
Removing the dark shroud from the disaster response industry
The shroud of the disaster response industry
“Emergencies have always been necessary to progress. It was darkness which produced the lamp. It was fog that produced the compass. It was hunger that drove us to exploration. And it took a depression to teach us the real value of a job.”
Victor Hugo (1802 - 1885)
I begin with this quote due to the fact that emergencies, disasters and unfortunate situations are what gave birth to the “Disaster Response Industry”. As I mention that I must also mention that it also was what gave birth to the “Insurance industry”. Since the beginning there has been a dark shroud which has developed due to greed, ambulance chasing and misinformation.
It is not “if” a disaster will take place, it is “when” it will take place. It is a given factor of life that there will be floods, tornados, hurricanes, fires, earthquakes and yes even the fuzzy area of mold which at sometime will pop up its ugly head. Unfortunately, it seems that those companies which were given birth by these unfortunate situations are all categorized as “ambulance chasers” or “opportunists”. Placing all disaster response companies and insurance companies in this category would be a shame, for there are some very good companies which both industries encompass. However it would be an injustice to ignore the fact that there is a definite separation between good and bad companies in each category.
So, what should the public know about both of these industries in order to help them get a clear picture of these industries? Does either one of these industries taking advantage of the public? Is it possible that this is one of the most unregulated industries and has its own price fixing? What are the components for a true disaster response company? Is it possible that the insurance industry uses the disaster response industry in hopes to make a profit of them? Is it possible that the disaster response company industry uses the insurance industry to make a profit at the customer’s expense? These are some of the questions which I will seek to address. The purpose, for this article is to pull back the shroud of darkness (ignorance) which has made it easy for media to attack the industry as a whole.
Recently we have seen a fierce promotion within the United States to seek out alternative sources of energy. Seeking to be less dependent on sources such as oil, we have seen a competitive outbreak of companies seeking to develop a better source of energy. Hybrid cars have come out of the woodwork, and this is due to taking advantage of an opportunity? Of course this is not wrong. There is a need to improve our consumption of energy, and there are those in business which are seeking to reach that need. Disaster Response Companies as well as Insurance Companies are really no different, and yet the disaster response industry is classified as “storm chasers”. Just as the car industry has some refining to do in the development of a better solution to the energy saving crunch, both the Disaster Response Industry and the Insurance Industry is seeking to refine their services for the client.
Now it is clear as it is in any industry there are unscrupulous practices which can be found in the disaster response industry. Price gouging, padded invoices and lack of certification for work performed does take place. There are those who run to disasters and at the most difficult time for some, take advantage by making promises and in the long run not fulfill those promises. There are four areas which need to be looked at when in discussion of “storm chasers”; 1. Opportunity and the proper and improper approach to the opportunity. 2. Pricing and price fixing. 3. Standards and Certifications and the lack thereof. 4. Planning, training and transparency of a company to the client.
Opportunity and the proper and improper approach to the opportunity
At 2:30 am in the city of Marietta GA an apartment fire starts. Within 15 minutes the fire department is on the scene fighting the blaze. Within 40 minutes the local news media is on sight reporting. The Property Manager, Director of Maintenance receive the call and in a short time are on the premise, trying to take care of the numerous families who have escaped the fire and now face to loss everything.
Behind the scenes cell phones, fire pagers are going off awaking fire chasers. Immediately they race to the scene with one thing in mind – secure the job to board up and begin the process to win the contract to rebuild the facility. These individuals are a part of a seedy and cut throat operation which proves to be the ugly approach some in the disaster response industry train their people to participate in. How do I know this, unfortunately I did this years ago. I was guilty of taking advantage of a situation, when confusion of the situation could be used to blindside property managers and directors of maintenance.
Under the guise of “trying to help” these individuals (fire chasers) plow into a situation striving to win the contract, knowing that they receive a commission on the jobs they nail. Glossy material is given to a glassy eyed property manager, and the “emergency services authorizations” are presented and pushed to get signed by whoever the fire chaser can get to sign it. Due to the fact that it makes the news, it is like that of roaches (other companies) coming out of the woodwork running to the fire site, seeking to move in and snatch the contract for emergency services.
The situation I just laid out for you does not only relate to fires, it also relates to hurricanes, flooding situations, tornado and hail and even earthquakes. It would be ludicrous not to point out the fact that there are those in the disaster response industry who do “take advantage of a bad situation for company gain”. Sadly one must address the fact that this is happening and has been happening for some time. There are certain factors which separate a true disaster response company and what I call a “reactionary incident driven company”. A vast majority of companies out there dealing with disasters do have the proper ethical and proper cause to be there, which is to actually help those in need providing their services.
What separates a true “Disaster Response Company” and a “Disaster reactionary, incident driven company”?
1. A Disaster Response Company seeks to take care of the client. They are companies which seek to know the client, their facility, how they do business and who they are responsible BEFORE the unfortunate takes place. Just as a good Doctor does blood work, evaluates blood pressure, weight, family history in order to take the best care of their patient, a professional disaster response company will seek to gather information in order to take care of that client.
It is important here to mention that those who are reactionary companies or storm chasers do not know disaster planning and nor do they care. It is looked at by them that the worse the loss, the more money for them. They do not look at retaining a long term client. Their relationship ends at the bill.
2. A true Disaster Response Company works within the disaster plan of the client. They offer training to the client and those they are responsible for, in order to prepare them for what to expect in case of an unfortunate situation. A reactionary company will not seek to educate the client as to the “science of drying”, “proper legal documentation” which should be on each job and “ways a client can prepare themselves and their staff to quickly jump on a bad situation therefore helping limit the scope of the loss. A Disaster Response company can give their price list to a client up front well before a disaster takes place.
3. A true Disaster Response company has personal that are certified and are specialists within the areas of concern. This is being addressed in its own section for it is an area which most of the public do not know is there! There are companies out there that do case bad situations and then go hire manpower, slap some company tee shirts on them and lead a client to believe that they are professionals with the credentials to take care of their situation properly.
4. A true Disaster Response Company understands and utilizes the proper equipment and knows the actual “science of drying process”. In many cases a disaster reactionary, storm chaser will jam as much equipment as they can into a situation in order to gain a greater profit. There are many different tools out there which all have a place in different situations. This is where a reactionary storm chaser does not concern them in helping educate a client. The more the client does not know, the more wiggle room there is for the company to make extra money. This may seem harsh, but I have seen this numerous times in all areas of disaster. Ozone, Desiccants, ultra violet and high heat dryers are just a few items which are misused by companies and the client think that they are helping them, when in fact it could be hurting and costing the client more unnecessary costs.
Now it is important to point out that there is a parallel to all that I have stated above. It is how the Insurance Industry has also its dark side in all of this. There are programs which Insurance companies have “preferred contractors”. This is an area in which insurance companies through Adjusters seek to push a company of choice (these companies are fixed with pricing proved by the Insurance Companies, thus keeping the insurance companies in control of the recovery) onto the client. It is the choice of the Client who they would like to pull in and take care of them, but there is stiff arming that takes place by the insurance companies. No one wants to say it, but it is actually illegal to do so. This is not even taking into consideration the “Independent Adjusters”.
Price and Price Fixing
I remember during Francis in Florida, the price of generators at large home improvement stores doubled and tripled in price. Price gouging was a reality and it was sick to see. In the same way, storm chasers do play games with pricing, money up front, and even peoples insurance deductibles. There were Companies getting 50% up front, and then not completing the job (not planning on completing) happens. There are reactionary companies who state that they will absorb individual’s insurance deductibles knowing that this is totally unethical.
Is there price fixing in the Disaster Response Insurance Industry relationship? One of the largest estimating programs which are utilized by both industries is based off of pricing set by the insurance industry. Is that price fixing? In some cases I do not think that is done purposely, however, it happens. In some cases, Insurance companies now in some of their “preferred contractor” programs, dictating where these contractors are to buy their materials.
In another way insurance companies play a game of “fixing pricing not to happen”. In other words, if there was a hurricane, and your house was flooded out due to water intrusion, they could come back and not cover you stating that you did not have “flood insurance”. This happens even though it was driving rain intrusion, but this is the game of price fixing to make sure they do not have to pay out. That actually is another seedy side of a disaster situation.
Industry Standards and Certifications
A storm chaser most likely will not have the certifications which are there for specialists. The IICRC, which is the governing body for this Disaster Response Industry, has set up strong courses and certifications in order to keep the standards of care to the client high. I have heard so many times by storm chasers that they are certified in water damage, mold remediation, when in fact there is no certification which they possess.
A true Disaster Response company will have the necessary certifications within the areas of service they are providing. Again, a true disaster response company will layout the certifications to the client before something takes place, and will also seek to teach the client about some of the practices required to gain the certifications.
“Emergencies have always been necessary to progress. It was darkness which produced the lamp. It was fog that produced the compass. It was hunger that drove us to exploration. And it took a depression to teach us the real value of a job.”
Victor Hugo (1802 - 1885)
I begin with this quote due to the fact that emergencies, disasters and unfortunate situations are what gave birth to the “Disaster Response Industry”. As I mention that I must also mention that it also was what gave birth to the “Insurance industry”. Since the beginning there has been a dark shroud which has developed due to greed, ambulance chasing and misinformation.
It is not “if” a disaster will take place, it is “when” it will take place. It is a given factor of life that there will be floods, tornados, hurricanes, fires, earthquakes and yes even the fuzzy area of mold which at sometime will pop up its ugly head. Unfortunately, it seems that those companies which were given birth by these unfortunate situations are all categorized as “ambulance chasers” or “opportunists”. Placing all disaster response companies and insurance companies in this category would be a shame, for there are some very good companies which both industries encompass. However it would be an injustice to ignore the fact that there is a definite separation between good and bad companies in each category.
So, what should the public know about both of these industries in order to help them get a clear picture of these industries? Does either one of these industries taking advantage of the public? Is it possible that this is one of the most unregulated industries and has its own price fixing? What are the components for a true disaster response company? Is it possible that the insurance industry uses the disaster response industry in hopes to make a profit of them? Is it possible that the disaster response company industry uses the insurance industry to make a profit at the customer’s expense? These are some of the questions which I will seek to address. The purpose, for this article is to pull back the shroud of darkness (ignorance) which has made it easy for media to attack the industry as a whole.
Recently we have seen a fierce promotion within the United States to seek out alternative sources of energy. Seeking to be less dependent on sources such as oil, we have seen a competitive outbreak of companies seeking to develop a better source of energy. Hybrid cars have come out of the woodwork, and this is due to taking advantage of an opportunity? Of course this is not wrong. There is a need to improve our consumption of energy, and there are those in business which are seeking to reach that need. Disaster Response Companies as well as Insurance Companies are really no different, and yet the disaster response industry is classified as “storm chasers”. Just as the car industry has some refining to do in the development of a better solution to the energy saving crunch, both the Disaster Response Industry and the Insurance Industry is seeking to refine their services for the client.
Now it is clear as it is in any industry there are unscrupulous practices which can be found in the disaster response industry. Price gouging, padded invoices and lack of certification for work performed does take place. There are those who run to disasters and at the most difficult time for some, take advantage by making promises and in the long run not fulfill those promises. There are four areas which need to be looked at when in discussion of “storm chasers”; 1. Opportunity and the proper and improper approach to the opportunity. 2. Pricing and price fixing. 3. Standards and Certifications and the lack thereof. 4. Planning, training and transparency of a company to the client.
Opportunity and the proper and improper approach to the opportunity
At 2:30 am in the city of Marietta GA an apartment fire starts. Within 15 minutes the fire department is on the scene fighting the blaze. Within 40 minutes the local news media is on sight reporting. The Property Manager, Director of Maintenance receive the call and in a short time are on the premise, trying to take care of the numerous families who have escaped the fire and now face to loss everything.
Behind the scenes cell phones, fire pagers are going off awaking fire chasers. Immediately they race to the scene with one thing in mind – secure the job to board up and begin the process to win the contract to rebuild the facility. These individuals are a part of a seedy and cut throat operation which proves to be the ugly approach some in the disaster response industry train their people to participate in. How do I know this, unfortunately I did this years ago. I was guilty of taking advantage of a situation, when confusion of the situation could be used to blindside property managers and directors of maintenance.
Under the guise of “trying to help” these individuals (fire chasers) plow into a situation striving to win the contract, knowing that they receive a commission on the jobs they nail. Glossy material is given to a glassy eyed property manager, and the “emergency services authorizations” are presented and pushed to get signed by whoever the fire chaser can get to sign it. Due to the fact that it makes the news, it is like that of roaches (other companies) coming out of the woodwork running to the fire site, seeking to move in and snatch the contract for emergency services.
The situation I just laid out for you does not only relate to fires, it also relates to hurricanes, flooding situations, tornado and hail and even earthquakes. It would be ludicrous not to point out the fact that there are those in the disaster response industry who do “take advantage of a bad situation for company gain”. Sadly one must address the fact that this is happening and has been happening for some time. There are certain factors which separate a true disaster response company and what I call a “reactionary incident driven company”. A vast majority of companies out there dealing with disasters do have the proper ethical and proper cause to be there, which is to actually help those in need providing their services.
What separates a true “Disaster Response Company” and a “Disaster reactionary, incident driven company”?
1. A Disaster Response Company seeks to take care of the client. They are companies which seek to know the client, their facility, how they do business and who they are responsible BEFORE the unfortunate takes place. Just as a good Doctor does blood work, evaluates blood pressure, weight, family history in order to take the best care of their patient, a professional disaster response company will seek to gather information in order to take care of that client.
It is important here to mention that those who are reactionary companies or storm chasers do not know disaster planning and nor do they care. It is looked at by them that the worse the loss, the more money for them. They do not look at retaining a long term client. Their relationship ends at the bill.
2. A true Disaster Response Company works within the disaster plan of the client. They offer training to the client and those they are responsible for, in order to prepare them for what to expect in case of an unfortunate situation. A reactionary company will not seek to educate the client as to the “science of drying”, “proper legal documentation” which should be on each job and “ways a client can prepare themselves and their staff to quickly jump on a bad situation therefore helping limit the scope of the loss. A Disaster Response company can give their price list to a client up front well before a disaster takes place.
3. A true Disaster Response company has personal that are certified and are specialists within the areas of concern. This is being addressed in its own section for it is an area which most of the public do not know is there! There are companies out there that do case bad situations and then go hire manpower, slap some company tee shirts on them and lead a client to believe that they are professionals with the credentials to take care of their situation properly.
4. A true Disaster Response Company understands and utilizes the proper equipment and knows the actual “science of drying process”. In many cases a disaster reactionary, storm chaser will jam as much equipment as they can into a situation in order to gain a greater profit. There are many different tools out there which all have a place in different situations. This is where a reactionary storm chaser does not concern them in helping educate a client. The more the client does not know, the more wiggle room there is for the company to make extra money. This may seem harsh, but I have seen this numerous times in all areas of disaster. Ozone, Desiccants, ultra violet and high heat dryers are just a few items which are misused by companies and the client think that they are helping them, when in fact it could be hurting and costing the client more unnecessary costs.
Now it is important to point out that there is a parallel to all that I have stated above. It is how the Insurance Industry has also its dark side in all of this. There are programs which Insurance companies have “preferred contractors”. This is an area in which insurance companies through Adjusters seek to push a company of choice (these companies are fixed with pricing proved by the Insurance Companies, thus keeping the insurance companies in control of the recovery) onto the client. It is the choice of the Client who they would like to pull in and take care of them, but there is stiff arming that takes place by the insurance companies. No one wants to say it, but it is actually illegal to do so. This is not even taking into consideration the “Independent Adjusters”.
Price and Price Fixing
I remember during Francis in Florida, the price of generators at large home improvement stores doubled and tripled in price. Price gouging was a reality and it was sick to see. In the same way, storm chasers do play games with pricing, money up front, and even peoples insurance deductibles. There were Companies getting 50% up front, and then not completing the job (not planning on completing) happens. There are reactionary companies who state that they will absorb individual’s insurance deductibles knowing that this is totally unethical.
Is there price fixing in the Disaster Response Insurance Industry relationship? One of the largest estimating programs which are utilized by both industries is based off of pricing set by the insurance industry. Is that price fixing? In some cases I do not think that is done purposely, however, it happens. In some cases, Insurance companies now in some of their “preferred contractor” programs, dictating where these contractors are to buy their materials.
In another way insurance companies play a game of “fixing pricing not to happen”. In other words, if there was a hurricane, and your house was flooded out due to water intrusion, they could come back and not cover you stating that you did not have “flood insurance”. This happens even though it was driving rain intrusion, but this is the game of price fixing to make sure they do not have to pay out. That actually is another seedy side of a disaster situation.
Industry Standards and Certifications
A storm chaser most likely will not have the certifications which are there for specialists. The IICRC, which is the governing body for this Disaster Response Industry, has set up strong courses and certifications in order to keep the standards of care to the client high. I have heard so many times by storm chasers that they are certified in water damage, mold remediation, when in fact there is no certification which they possess.
A true Disaster Response company will have the necessary certifications within the areas of service they are providing. Again, a true disaster response company will layout the certifications to the client before something takes place, and will also seek to teach the client about some of the practices required to gain the certifications.
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