Elegant Solutions

Standard Oil soon discovered they were spending
more money for the credit reports than they were losing to deadbeats who didn't
pay their heating oil bills. The solution? They continued to require people to
fill out credit applications but, credit reports were never ordered. It's true
Standard Oil had to eat a little money from deadbeats who didn't pay for their
bills but, it was only a tiny percentage of the money they would have had to pay
to get credit reports for all the applicants.

A different Standard Oil story: They also had many
large commercial accounts and, the credit worthiness of those accounts were
checked out before credit was extended to them. This was done by getting a
D&B (Dunn & Bradstreet) report on each of the companies. There were all
kinds of formulas anyone could use with a D&B report. They could analyze
total receivables to total debt, net worth versus liabilities, yearly income
versus yearly payables, to name only a few. Matter of fact, Dunn &
Bradstreet even had a school for the employees of Standard Oil to teach them how
to read the D&B reports.

Anyway, Standard Oil kept track of all the
employees in their credit department to see how accurate their judgements were
in approving or denying credit to these large commercial accounts. You know who
the most precise person of all was? Me. Why? Because I never went to Dunn &
Bradstreet's school and I never learned to use any of their formulas.

So how was I able to figure it out? It was quite
simple. At the bottom of each D&B report, there was a paragraph titled
"Summary". These Summaries could read something like this:

Summary

ABC Corp. is well managed, has a positive cash
flow, and low debt. Its employee turnover is remarkably low. Demand for their
product and services is steady and increasing. Overall, they look like a solid
company with a good future.

That's all
I would read. In that scenario, I would stamp "approved" on ABC
Corp.'s credit application.

On the other hand, sometimes a company's Summary
could read along these lines:

Summary

XYZ Inc. is poorly managed, overburdened with
excessive debt and lacks the inventory to fill their current and previous
orders. There are 14 pending lawsuits against them and their CEO has just been
indicted for sodomizing a farm animal.