In this episode, the team talks about home inspection ethics. This was brought up because Bill got a call from somebody in the company who had a question about doing business with a real estate agent who was hoping that we would support their business with monthly financial contributions. And that raised the question, “Is that ethical?”
The show starts with Reuben saying that inspectors should avoid conflicts of interests or activities that compromise or appear to compromise professional independence, objectivity, or inspection integrity. He also shared his thoughts when somebody says, “we’d like to pay to play.” Then the team talks about the codes of ethics as an ASHI member and answers some questions:
Does getting referrals from an office or a real estate agent because of supporting them on a monthly basis compromise professional independence?
What can you say about inspectors building relationships with real estate agents by bringing some food, doughnuts, or providing lunch for them?
Is there an ethical question when we recommend to a client to do another test or service that also benefits our business, and we’re referring them to use us?
Is it ethical to self-refer your company’s services?
Who looks out for the customer when they’re unknowledgeable to the inner workings of a service that they are purchasing?
The following is a transcription from an audio recording. Although the transcription is largely accurate, in some cases it may be slightly incomplete or contain minor inaccuracies due to inaudible passages or transcription errors
Reuben Saltzman: Inspectors should avoid conflicts of interests or activities that compromise or appear to compromise professional independence, objectivity or inspection integrity.
Bill Oelrich: Welcome, everybody. You’re listening to Structure Talk, a Structure Tech presentation. My name is Bill Oelrich alongside Tessa Murry and Reuben Saltzman. On today’s episode, we’re gonna dig a little bit into the ethics of our business, and here’s the reason that this came up, because yesterday I got a call from somebody in our company who had a question about doing business with a real estate agent who was hoping that we would support their business in like, “Hey, we would love to have you on board as preferred inspector, and to get on board with us as being a preferred inspector, what we’d like you to do is contribute a little bit to us on a monthly basis,” and that raised the question of, Well, is that cool? Is that ethical? Does that put us in any hot water with anybody? So on and so forth. So I thought we would dig into this today, and Reuben, you’ve been in this business since it started.
RS: [chuckle] I don’t think so, man. ’97.
BO: Let’s talk a little bit about the code of ethics, so we belong to ASHI, we’re ASHI members, the American Society of Home Inspectors, they have a standards of practice, they have a Code of Ethics, if you’re an ASHI member, you take a quick test on both of them to make sure you understand the rules of the game, and you conduct yourselves in a way that’s respectful and appropriate, whatever other label you wanna put on there. So Reuben, what’s your initial feeling when somebody says, “We’d like you to kind of pay to play.”
RS: Oh, sure. As long as I… Or as long as Structure Tech contributes X, in return we will do Y for you, and usually it’s, “Hey, give us $500 a month, and our team will support you or give us X dollars per month, and you will be allowed to put brochures in our resource room and a million other variations of this, and sometimes it gets really creative where real estate agents will say, “Well, no, look, we just want you to do co-branding, we want you to contribute to the printing costs of this brochure,” and so we’re not actually giving them money we’re putting some money down towards helping to do some co-advertising, and there’s no explicit agreement that they’re gonna give us any business for this, but it’s kind of unwritten. Bill, it is a slippery slope, and I don’t know exactly what’s right and what’s wrong, I will tell you that this is addressed by the ASHI code of ethics, and I pulled it up here while you were talking about that, it says that: Inspectors should avoid conflicts of interests or activities that compromise or appear to compromise professional independence, objectivity or inspection integrity.
RS: So let’s focus on that. If I’m giving an office or a real estate agent a chunk of money on a regular basis, and there’s kind of an expectation that I’m gonna get some referrals because of this, does that appear to compromise professional independence? I’m asking you guys, what do you think?
BO: I don’t believe it compromises professional independence, because we’re still gonna do the job that we’re going to do to the best of our ability and deliver the inspection according to our standards.
RS: I’m with you Bill, it wouldn’t compromise it, but would it appear to compromise it? Is that a possibility? If you’ve got a realtor and they say, “Hey, Tessa, I’m your realtor, you’re buying a house, you need to get a home inspection, I recommend Structure Tech, they give my office $500 a month.” Now, that’s neither here nor there, but they do a really good job, what are you gonna think, Tessa? Are you gonna raise an eyebrow at that?
Tessa Murry: Yeah, I probably wouldn’t trust that.
RS: Yeah, are you gonna be thinking to yourself, “Hmm, they’re truly the best,” or are you thinking “Hmm, he’s referring this company because he’s getting $500 bucks a month to do so,” it just feels like that’s something that should be right on the table for anybody to know about, and I don’t know how these arrangements go, we have not participated in those types of arrangements, but I have a suspicion that when these arrangements happen, the people who are getting the money are not advertising the fact that they’re getting paid to give out an inspector’s name. It’s kind of hush hush type of stuff.
BO: But if it’s in full transparency, if we’re partners in a sense to help you get through this process, to get you the best information possible as quickly as possible, I don’t see that’s a problem. I just feel like that’s doing the best you can do for your client to make sure they make the best decision for them.
RS: Maybe so, maybe so, and I’m not here to judge, I’m just asking some tough questions here, let’s look a little bit more at that code of ethics, I talked about the heading, but there’s a sub-heading underneath that, that’s like A1, that’s the first thing it says in the code of ethics, under section, 1C it gets a little more specific, it says, inspectors shall not directly or indirectly compensate realty agents or other parties having a financial interest in closing or settlement of real estate transactions for the referral of inspections or for inclusion on a list of recommended inspectors, preferred providers or similar arrangements.
TM: That’s very specific, right there.
RS: Yeah, I mean, it’s pretty black and white to me, like you cannot pay to play.
TM: Well, so I guess, what do you say about like an inspector who maybe tries to build relationships with real estate agents and maybe they bring some food or some donuts, or provide lunch, or maybe some free CE, Is that indirect payment?
RS: Well, Tessa I’m sorry, I’ve sat through like a dozen classes explaining the difference between marketing and advertising, and I can’t keep the two straight, so I apologize, and you’re gonna wanna smack me when I use the wrong word right now, but it’s either marketing or advertising, I can’t remember which, when you’re just trying to solicit business from a bunch of people. I see nothing wrong with that, there. This is black and white to me, I mean, that is perfectly okay, because there is no arrangement, that’s the defining difference there.
TM: That’s just a part of trying to grow your business as a home inspection company is trying to get your name out there and meet these real estate agents that you’re hoping to work with, you’re not asking them to give you business out of that donut or that free CE class…
BO: Yes, you are, you aren’t there for any other reason to get business, you’re not just stopping in to say, “Hi, how’s the weather?”
TM: Well, so this is an interesting question because I see what Reuben’s saying, and I see what you’re saying, Bill, there’s two perspectives on that.
BO: To me, this is… We just are gonna determine what’s egregious and what’s not egregious, that seems like the conversation we’re having, and to me, this is just how business works, you go out and you create relationships with people, and you get to know people so they can trust you, and then they can trust that when they refer you, their clients are in good hands, and that all starts with an experience. And how does that door open? Does that door open, because you brought coffee and donuts, is it that conversation can only happen if we put our hands on whatever sacred book we choose and say, “I promise this is just a business conversation. There is no quid pro quo, there is no this for that, there’s nothing in here that would be construed as a conflict of interest.” This is what I think is really funny, and especially the code of ethics is very clear, Reuben, as you say, it’s very clear, but how many companies are in the shadows of that code of ethics and operating in a way that we’re kind of talking about right now. It feels to me like this was something that was put out there to be an iron curtain, and it’s not, it raises more questions than it does answers.
RS: Yeah, I agree. ASHI has this publication that they put out monthly called the ASHI Reporter, and in just about every episode, there’s a section in the Reporter dedicated to the ASHI Code of Ethics, and the code of ethics is like… It’s a one-page PDF, if you use a large font, I mean, barely one page, and there’s not much in here, but I swear there have been about 10,000 questions asked on this one item, Number 1C, it’s the relationship between home inspectors and real estate agents. And month after month, year after year, I see people writing in the same kinds of questions, everyone’s just a little bit different looking for an RFI, a Request For Interpretation, and it’s always somebody on the ethical committee, who’s gotta have a different answer to these questions, and it’s never ending. It will never end, Bill, so that’s why we thought this would be a good thing to discuss, not to say that we have the answers, but it’s a sliding scale of what’s acceptable and what’s not.
BO: Well, yeah, and if everybody hasn’t figured it out by now, I’m a capitalist. If you can provide a service that is great, and it’s the highest level of service, and the client who buys that service is happy with it, and they’ve got a fair price and all of that stuff, I say there should be no real boundaries on this sort of thing…
RS: What do you think about what you just proposed, what if our company were to pay a real estate agent, whatever, $500 a month, and then they would agree to only recommend our company for home inspection, would that be okay?
BO: Yeah, so Reuben, I think I would turn this a little bit, and I’d wanna have this conversation about the client, who is the person who’s actually paying the bill, and I think that’s the discussion where I’d wanna be talking about my service fee, and how can we help get you what you need, right? Whatever benefit I could bring to the real estate agent through education, through world-class service, all of that other stuff, we support the agents by supporting their clients, and so let’s talk about that in terms of the client, because they’re the ones stroking the check.
TM: You know it’s interesting, you brought up the fact you’re a capitalist, and when you start referring one company to a client who may not have any knowledge in this area, they’re looking to you for guidance, they’re gonna trust you, they’re probably going to use that vendor, because you spoke highly of them, but who’s to say without the checks and balances if that vendor is going to be… Provide them good services over time, management changes, circumstances change, and maybe you’re cheating that client out of the best service, because you have this relationship now.
BO: Well, I think you touched on it, you have to communicate continuously with everybody involved. I don’t think it’s good enough to throw a vendor on your preferred vendor list and not periodically check in with them and see how their service is going, I mean, make a call to everybody on your vendors’ list, do they pick up the phone, do they return your phone call? Grade them on how they’re doing, if they’re not providing service at the highest level I’d get them off the list, and I go find somebody who is gonna provide my clients the highest level of service, and so it’s the responsibility of the people in the relationships on all sides of it to maintain the highest level of service, and if they’re not, then you move along, you move on.
RS: So you didn’t answer the question though, Bill, it’s a lot of beating around the bush. I still haven’t gotten an answer out of you, is it acceptable?
BO: Is it acceptable? No, not according to the standards or the code of ethics that Structure Tech is adhering to. Okay, I’m giving you the answer that for the company that I do business with, is that… Is it ethical? Is it right, no, because we have chosen to hold ourselves to that standard.
RS: Okay, alright, I won’t press you on that anymore. Thank you.
BO: I think that you win through the level of service you provide, and if there’s price adjustments, that’s between you and your client, and I think you should be able to let your referral partners know what you’re doing for their clients. I don’t think there’s anything wrong with that, but there’s always an exchange at one for something, they give us money, we do a great home inspection. They pay real estate agents to provide the highest level of representation.
TM: So this kind of bleeds into the question, I guess, about some of these other additional services that a lot of other home inspection companies provide to their clients like us at Structure Tech, we’ve got… We do radon testing, we do sewer inspections, we do chimney inspections, we do mold testing. Is there an ethical question when we recommend to a client that they do this additional testing and that it benefits our business, and we’re referring them to use us? And moisture testing, I forgot to mention that too.
RS: Yeah, good point. If we do a home inspection and we make a recommendation in our report for a chimney inspection.
RS: Like, “Hey, I was able to look up the flue, look down the flue. We just talked about chimneys recently. I was able to do all this, but I wasn’t able to see all of it,” and we say, “We recommend having a level two chimney inspection done.” And Tessa, you’re saying, is it ethical if we do that, because, I mean, after all, that could turn into more work for our company, right?
RS: That’s a good one. And I say, yes, I’ve given this a lot of thought, and I’d say if the purpose of your recommendation is to get more business for your company, then no, that’s terrible. But if the purpose of your recommendation is to help your client out, give them more information about the house and this is a legitimate concern and you can defend that concern, then yeah, whether your company offers this service or not, shouldn’t make any difference. You should be able to make that recommendation. I mean, we’ve been doing that forever when it comes to radon testing, we’ve been saying, get a radon test, that this falls in line with what the EPA and the Minnesota Department of Health and everybody else says is you get a radon test and oh, you need one?
RS: Yes, we do offer that. That is an add-on service we have. Just because we offer it, it doesn’t mean that it’s not a valuable service. That’s the big difference there. And so, I mean, we do it with radon, we do it with chimney, and we tell people this when they schedule the inspection. We say if you’ve got a wood-burning fireplace with a masonry chimney, you should get a level two inspection. If you need it done through us, we can do that. Same thing with sewers, same thing with buying a newer stucco home, we recommend intrusive testing on pretty much every one of those, just like we talked about in a recent podcast on stone veneer, same with those. There’s a lot of value in having that done. I see zero conflict of interest by recommending these additional services.
BO: Let’s take it a step further. Okay, so radon is something we can’t see, we don’t understand what levels there, so the only way to know is to test, so you make that recommendation and we provide that service, and so do many other companies, if you work with us, you get it all at the time of your home inspection report, if you work with somebody else maybe you get it sooner, maybe you get it at the same time, maybe you get it later, I don’t know. Sewer inspections are the same way, chimney inspections are the same way. What happens if you are an entrepreneurial type who has ownership in multiple companies and there’s a broken plumbing line or some drain pipe that needs to be repaired and you just happen to own part of a plumbing company, is it ethical to self-refer in that way?
RS: Oh boy, that’s a tough one. I mean, if we look at the ASHI’s Code of Ethics, Item 1F says inspectors shall not repair, replace, or upgrade, for compensation, systems or components covered by ASHI Standards of Practice, for one year after the inspection. So basically it’s saying, no, it’s not ethical for you to be working on their plumbing system and doing repairs because it is covered by the ASHI Standard of Practice. You can do it after the first year, but not before.
BO: The person who’s doing the repair is not the person doing the inspecting.
TM: It’s the same company though, right?
BO: Maybe, maybe not. It might just be that an owner of a company has an interest in two different companies, and so the person doing the inspecting isn’t the person doing the repairing, but on that list of preferred vendors, and it says ABC Home Inspections, and then it’s ABC Plumbing, is that okay? That’s a different level, and I think we can get around the code of ethics on that because it’s not the inspector doing the work.
RS: Okay, but I think it’s exactly what you just said, Bill. We are getting around the code of ethics, and I don’t think we’re meeting the intent of the code of ethics, we’re kind of creating our own loophole to get around it and to be able to do that work, even though the code of ethics is supposed to kind of prohibit that. Wouldn’t you agree?
BO: No, I don’t agree, and I’ll go back to my… If you provide a great level of service and you do great work and you back your work up and it’s a fair price, I don’t see an issue with it.
RS: I’m not talking about whether you see an issue with it, I’m saying is that the intention of the code of ethics?
BO: I don’t know. I can’t give you an answer to that. I think the code of ethics, if you read it, it clearly says, John, the inspector can’t come back as John the plumber and charge a fee within the first year.
RS: Yes, it says inspectors. This code of ethics was written a long time ago when inspectors were one-man shops or one-woman shops. Well, let’s be honest, they were all one-man shops.
TM: [chuckle] Yeah, sure.
RS: [chuckle] Women in this profession is kind of a new thing. But…
TM: Yeah, no offense taken.
RS: Yeah, yeah. That’s just how things are. It was all one-man shops when this was written. Now, if this language were to be updated, Bill, don’t you think that it might say something like, “Home inspection companies”, don’t you think that’s the intent of this? Or do you really think the intent is that the exact same person can’t come out? I’m raising my eyebrows a lot right now, Bill.
BO: Yeah, yeah. Well, you can raise your eyebrows. I get where you’re going with it, but what I’m suggesting is this is a free market, and as long as people do great work… See, the foundation that I continue to stand on here is I wanna bring to you the highest level of service, in whatever company I have an ownership stake I always wanna be providing the highest level of service. It just so happens if one company can connect you with another company in an expeditious manner and you get the same price or a better price and you get the work done, and all of that, I don’t see a problem with it. I think this code of ethics quite frankly might be outdated.
TM: I just was thinking in terms of consumer protection, it makes sense to have that there because I think we ran into this problem, didn’t we Reuben? You can probably speak more to this, when we were referring our clients to a chimney inspection company, and that inspection company also did repairs, and so real estate agents were and clients were a little bit upset about that because they were thinking, “Well, how can I trust these recommendations on these issues if they’re the company that fixes it too?”
RS: Yep. And we dealt with that a lot, and that’s why we took chimney inspections in-house. I know we’ve said this probably about half dozen times on the podcast, but that’s why we took too many inspections in-house, is because the only chimney inspectors we could find were people who also did repairs, and we had so many people crying foul, saying, “That’s BS. You guys are just condemning this chimney because you wanna sell a $10000 liner, or your chimney inspector wants us sell a $10000 liner.” And the second we took it in-house, all of that just went away. And the recommendations were the same as our chimney company, but there was no longer a perception of a conflict of interest. So, Bill, we’re going around and around on this, and I’ll give you my two cents. I think that this is the intention of the ASHI Code of Ethics, is to not allow home inspection companies to do repairs on this. And let’s just take it even one more removed, let’s say Saltzman Enterprises owns Structure Tech and then we also own Sewer Repairs 1-2-3. I would argue that the intent of the code of ethics is that Sewer Repairs 1-2-3 cannot do sewer repairs on a house that Structure Tech has inspected.
RS: And if this language were a little bit more up to date, that’s what it would say. I think that that’s what the Code of Ethics is supposed to be. Now, what you’re arguing, Bill, is the validity of this. You’re trying to talk about whether it’s right or wrong for this to even be a part of the code of ethics, and I’m more on your side, Bill, I mean I agree with you. I’m kind of playing the devil’s advocate when I’m really sticking with what the code of ethics means, but I’m with you. If you do a really good job and you’re not up to anything bad and you provide a fantastic service for your clients…
BO: At a fair price.
RS: At a fair price. Why can’t you? I’m with you, Bill. I think it should be allowable. Today it’s not part of the code of ethics, we draw a clear line there, we don’t do any type of work here at Structure Tech, but we have people beating down our door asking us to do work, I swear, because they have a good experience with us, they know us, they trust us, they like us, they like the service we give. I’ll tell you, after I read Delivering Happiness by Tony Hsieh with Zappos it changed the way I wanted to give customer service at Structure Tech. And we knock people’s socks off, and they want to do more business with a company like that. And they’re like, “We want you to do the repairs. We wanna work with you. Can you arrange the contractors?” And we gotta draw a line there, but I don’t like having to draw a line there. I’d like to be able to help these people.
BO: Absolutely, absolutely.
RS: I’m on your side, Bill, [chuckle] I’m trying to just focus on the exact topic here.
BO: No, I understand, and I appreciate that. And I think in your example, Reuben, about the home inspection company and the sewer line inspection company, I believe that people do business fairly and honestly and they’re not just bringing to you a BS repair that you don’t need to do. And if there’s no trust in the system, well that’s just sad. At the most basic level I’m very sad that you can’t be trusted and be a capitalist at the same time.
RS: Yeah, yeah, although there are people who take advantage of it, let’s be honest. I mean, I know of a moisture testing company, I’ve told this story on the podcast before.
RS: This was a long time ago before we had bought Private Eye, and before we were doing moisture testing, I was talking to another moisture testing company who offered infrared inspections, and as I’ve said many times, I think infrared is basically useless when it comes to finding water intrusion on exterior walls. It’s not going to positively identify anything and you’re gonna miss big moisture issues if you’re relying on your infrared camera. And I talked to this guy who was offering that, and because everybody wanted this magic bullet where you could find water intrusion without having to drill holes, and he was staying super busy doing infrared inspections and I was like… We’ll just call him Bill. I said, “Bill, why are you doing this? You know and I know that infrared is useless.” He said, “Reuben, I’m using this to find thermal anomalies, and when I find thermal anomalies, people can use that to justify the need for intrusive testing, so it gives the buyers a tool and they can go back to the seller, and say ‘My inspector found thermal anomalies with the infrared camera, we wanna do intrusive testing’ and then it gets everybody to do it, and I get to charge twice for it. And by the way, I always find thermal anomalies.”
RS: This is what he told me. And so, I mean, what do you think is this ethical? Alright, I’m not even gonna let you guys answer. Hell no. Hell no, you are double dipping, you’re lying to people, you know what the outcome is going to be before you do it. So I think there are times when this can really be twisted.
TM: With other things, not just thermal anomalies, but I think one common one that comes up in our industry is like structural issues or electrical issues, and where do you draw that line where you see something and as a home inspector maybe you don’t want the added liability and you feel more comfortable kind of referring someone out specialized to come inspect these systems, but if it’s within your own company and your own company’s benefiting from that, that’s a gray area, I think, yeah.
RS: Yeah, like Tessa you’re saying, “What if we hired on a structural engineer?”
TM: Yeah. Yeah.
RS: I’d like to get an engineer on staff. For anybody listening to this podcast, if you know any good structural engineers, I have not been actively pursuing that but I like the idea of getting an engineer on staff to help out with that stuff, when there’s stuff that we need to refer out I’d like us to be able to take care of that.
BO: So, Okay, let me jump in here. Why do you want that?
RS: To provide good service. People already come to us… I mean, with a name like Structure Tech, people just already assume that we offer structural engineering. We don’t, but I’d like to be able to just take care of the stuff in-house, have a quick turnaround on the stuff. If people want it, look we can do it.
RS: Sometimes people will call us before the inspection and say, “Hey, we’re buying this house, we see this, this and this. Can your inspector determine whether this is structurally adequate?” And we’ll just tell people no right off the bat, and we’ll say, “Contact this other company. We know these guys, they do a good job.” That’s the same reason we took sewer inspections in-house, we got tired of just trying to coordinate with another company. And finally we said, “Look, we’re gonna make it a one-stop shop. We make it easier for real estate agents, we make it easier for our clients, we just take care of it. And that’s the same reason I’d love to have structural engineering being done at Structure Tech.
BO: Right. And you wouldn’t refer your clients to that structural engineer unless there was an issue that you thought really needed the attention of a structural engineer.
BO: And why is that?
RS: Well, if you’re just referring everything, then you’re devaluing your own service. When I see home inspectors write up recommendations for structural engineers for these tiny cracks in the basement, I just think to myself, “Grow a… ” Well, you know where I’m going with this. Figure it out, take a few classes and understand that a couple little cracks is not a severe thing. You don’t need to punt to an engineer every time. Make the call, either say it’s fine and it’s typical cracks or tell people it’s a major deal and you need to get it fixed. It’s only the times where you really don’t know that you recommend an engineer. And if you take a few hours of classes on being a home inspector dealing with cracks, you should quickly be able to kind of figure out the difference between nothing and something major.
BO: Sure. Now, let’s go back to your intrusive moisture testing example, because there’s often no indication whatsoever that you have problems. And so then you’re recommending it every single time. And for the guy using the thermal imaging, I’m terrified of his exposure, risk-wise, for the one thermal image that he doesn’t recommend invasive testing on, which has huge problems behind it. And then they go to replace a window and a wall is gone beneath it. And then they come back and they’re like… I think you called him Bill… “Hey, Bill, where’s the wall that you said was great, that there wasn’t a problem?” Right now we can kind of play this game all day long, but you have… The reason you can have all these services in your company under one roof is because people trust you. Because you do business at the highest level, it’s transparent. And when I say transparent it’s like, “Hey, we love partnering with this real estate company because they do a great job,” or “We love being associated with these people because they do a great job.”
BO: All of that. And so now we’ve come full circle. And I just think it’s good business to have great relationships and provide a service at the highest level.
TM: How do you define a great service? Because a lot of our clients don’t have any experience with the trades or don’t understand engineering, and so when they call us they trust that we are providing the best service, but there’s no way of really checking up on that.
BO: Well, the only way that you can provide the highest level of service is by having a certain level of experience, seeing the things that you know need a certain amount of attention, and then connecting those things that need that attention with people who can give it the proper attention. And by doing all of that you become an expert. You become the authority. And I’m doing that in air quotes, on “How do you get from this place to that place? And this place is a place of uncertainty, to a place over here of certainty? Well talk to this expert and that expert, and they’re gonna help you.” And that’s all you can do. All you can do is just keep growing, keep learning, like this infrared testing before invasive moisture testing. My guess is at some point people thought that worked, and they started with the premise that that works.
BO: They went through a period of time trying to use it, but then it was determined it doesn’t work, so then they had to abandon that way of thinking. It’s just growth, it’s evolution, that’s how life works, right? You take the best that you have now, you apply it, and if it doesn’t give you the desired result you either abandon it, or tweak it and move forward with it. And I feel like the code of ethics is… It was set up at a particular time but business has sort of left that code of ethics behind, because we’re seeing consolidation in companies. Home inspection companies might wanna own an HVAC company, they might wanna own a plumbing company, they might wanna own a structural engineering company. And now you have this antiquated document that says you can’t do that, it’s just… They haven’t kept up with business, they haven’t kept up with the times. And this business I’m talking about might be providing the highest level of service to their clients, unmatched anywhere. But according to the code of ethics that’s wrong. And that’s where I have a problem with the whole thing.
TM: The question I have is, how do you define the highest level of service?
BO: That is open to interpretation by the people who write the checks.
TM: Here’s the thing though about consumer protection, the people that write the checks, they might think they had a great inspection, maybe the inspector was a really good communicator, kinda put on a show. Does that mean they had a good technically correct inspection, and that that inspector found all the big things? Is that a fair assessment, that that’s the best service provided, when that person thinks they had a great inspection, but maybe in reality they didn’t? How do you define that?
BO: You can’t, there has to be checks and balances along the way. We are all allowed to have a bad day. I can take the best home inspector and they might miss something, because they might have gotten into a car accident on the way there. There might be some issue in their life, there might be some distraction which caused them to walk by a major problem. And it’s not that they’re a bad inspector, they just had a bad day. There’s insurance policies for that, there’s companies that stand behind their work. And that’s when you know you’re standing with an ethical company. There’s the Better Business Bureau. There is consumer protections out there that we have to allow them to do their job, but that doesn’t mean that we don’t get up every single day and try to provide the highest level of service for our clients. That’s what we do on a daily basis. We try to do the best we can, and we charge a fair price for that. And we turn these things around very rapidly, and get people information they need to make very big decisions. And to have one document that says whether or not the way we conduct business is ethical, I kind of have a hard time with that.
TM: I respect your opinion, and I wish that every entrepreneur and company owner and capitalist thought that way, Bill, that, “Hey, we wake up every day and we do the best we can, provide the best service for our customers.” But my concern is, who looks out for the customer when maybe they’re ignorant to the inner workings of a service that they’re purchasing? They may not know what’s good or what’s bad, and so it’s very easy to take advantage of that person if you don’t have someone who is ethical in that powerful situation… Position.
BO: Sure, and I’ll leave those people to the recourse that they have, through lawyers and the systems and other things, but I’m hoping that people who know they have this blind spot seek professionals to help illuminate the blind spots that they have, and to verify the professionals that they’re working with, right? Trust but verify. We talk about that in business, and just do a great job. But it’s… We all have a duty to ourselves to do our research, to ask questions, to deal with reputable companies, and that’s part of building a strong company, it takes time. You have to build your authority and your reputation and you have to be good and stand behind your work and have partnerships with good companies that are reputable and trustworthy, ’cause if you don’t you are gonna end up on the scrap heap of broken businesses. But if you conduct yourself in ethical ways and you build solid profitable businesses that are ethically on strong foundations, you don’t seem to have these problems.
TM: You know what, I just watched a documentary on Netflix, and I don’t disagree with you, but it’s called The Founder, and it’s about McDonald’s basically, and how it went from just kind of being a start-up fast food restaurant to growing into this billion dollar franchise, and they didn’t grow because they were ethical or they were doing the right thing. You should watch it if you haven’t seen it, the guy who franchised McDonald’s I would say was very questionable when it came to ethics.
RS: Ray Kroc?
TM: Yeah, yeah.
BO: Well, I don’t know any of any of what you’re referring to, Tessa, so I can’t comment on that, but what I do know is that McDonald’s delivers a very predictable experience, and that’s why people go back. They do a great job of providing a very predictable experience. And it’s food, right? We have the choice, we can go anywhere and buy a sandwich for lunch, for dinner or breakfast or whatever. We’re dealing with a little higher price tag, a little bigger risk threshold I think than just food, so I’m not dismissing what you’re saying, what I’m suggesting is that when I’m looking for my home inspector I’m probably asking around a little bit, I wanna make sure that I’m dealing with people who are top notch and they have a reputation within the community of being good. So…
TM: It’s up to the consumer. Do your research, make sure you know what you’re getting and hire a good company.
BO: That’s right. But I think those companies can do business across multiple platforms and multiple companies and serve one client at a very high level without walking into some ethical gray zone.
TM: Good debate. Good discussion. [chuckle] I don’t think we clarified anything, I think we just went back and forth in this gray area.
RS: Well, it gives people outside of this a little bit of insight into how all of this works and what home inspectors are maybe allowed to do with real estate agents and advertising and what they’re maybe not allowed to do, and some of the dilemmas that we face when it comes to trying to promote our business ethically.
TM: Yeah, yeah.
BO: And we’re just one small little part of the world, right? Anyway, thanks everybody for staying with us through this conversation, my name is Bill Oelrich, I’m a capitalist, I’m sitting alongside Tessa Murry and Reuben Saltzman, all three of us do business in very ethical ways and we deliver very high levels of service. Thanks for listening to Structure Talk. We will catch you next time.