What a 5000 year old producer-buyer dispute can teach us? A snapshot of ancient business hazards, crisis development, and customer satisfaction in the extraction business.

What a 5000 year old producer-buyer dispute can teach us? A snapshot of ancient business hazards, crisis development, and customer satisfaction in the extraction business.

May 7th, 2015

1750 BC complain about the wrong grade of copper

1750 BC complain about the wrong grade of copper

Ancient business hazards, crisis development, and customer satisfaction

In a book entitled “Traces of Paradise: The Archaeology of Bahrain, 2500 BC to 300 AD” we have found an interesting example of “business dispute” translated from a cuneiform tablet.

The letter is quite interesting because it was actually found in Ur, so we have an approximate find spot, which is unfortunately somewhat rare for most cuneiform tablets.
It’s also interesting because of the mention of merchants who trade with Telmun, a city in the Persian Gulf, probably near to if not located on the island of Bahrain. There was a certain merchant named alik Tilmun (literally “one who goes to Telmun”) who was associated with trade in the Persian Gulf. And not surprisingly (if you read the letter) copper was a major part of this trade network. Now it should also be said that there were many trade networks flowing into and out of Mesopotamia at that point and the trade through the Persian Gulf was just one facet of a larger network.
Imagine a distributor and an intermediary in our “modern world” firing clay tablets across cyberspace as they get quite annoyed at each other. The translation is approximate, but I think you will get the drift quite easily.

When you came, you said the following: “I will give Gimil-Sin (when he comes) fine quality copper ingots.” You left then, but you did not do what you promised me. You put ingots which were not good before my messenger (Sit-Sin) and said: “If you want to take them, take them; if you do not want to take them, go away! “
Who do you think I am to treat me like that? I have sent as messengers gentlemen like ourselves to collect the bag with my money (deposited with you) but you have treated me with contempt by sending them back to me empty-handed several times, and that through enemy territory. Nobody has ever treated me like that! ….. You have withheld my money bag from me in enemy territory; it is now up to you to restore (my money) to me in full.
Understand that (from now on) I will not accept here any copper from you that is not of fine quality. I shall (from now on) select and take the ingots individually in my own yard, and I shall exercise against you my right of rejection because you have treated me with contempt.

What we see here is a:

  • quality assurance mishap (we start by assuming that there is no malevolent intention from the supplier side),
  • refusal to proactively seek customer satisfaction (if you do not like them, leave the ingots),
  • refusal to refund if product’s quality is not met,

The situation is aggravated by the fact that “enemy territory” has to be crossed, adding hazards and risks to the already boiling crisis.

The consequence is exactly what we would do today (should changing the source of the product be impossible):

  • Increased scrutiny on the product,
  • stricter standards,
  • tougher regulations.

The story could happen today, and does happens regularly. In today’s world numerous “devices” exist either in the business or the banking system to mitigate the likelihood of this kind of dispute. However, the likelihood is still far from negligible and that’s why Riskope intervene with their quantitative risk engineering background at different levels of contract stipulations. The support includes:

  • formulation of contingencies (probabilistic schedule, cost) to allow for better evaluations,
  • development of Force Majeure clauses (deriving quantitative thresholds) to minimize disruptions in the aftermath of a catastrophe,
  • implementation of B2B win-win solutions geared toward minimizing overall risks (thanks to wide spectrum cross industry experience ).

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Category: Consequences, Risk analysis, Risk management

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