Hall of Fame: Henry Berling
Henry Berling helped build Owens & Minor on trust, openness, honesty … and good business sense
Trust turns into loyalty, which is the key to getting a lot of things done. That was the guiding principle for Henry Berling as he helped steer Owens & Minor through 40 years of expansion in terms of geography, services offered and stature in the industry. It also helped him – and his company – negotiate some nervous moments.
“We took a great deal of risk from time to time, but I never thought we wouldn’t succeed,” he says. “We always looked forward, and that worked very well for us. I was just pleased to be part of it.”
Berling was born and raised in Richmond, Virginia. His father, August – a German immigrant – was an entrepreneur, who owned an auto body business, then an ambulance business, a lab supply company and finally, a med/surg distributor called A&J Hospital Supply.
August and his wife, Louise, raised their kids to be polite, to listen to what others were saying, and to always do their best. It is the same approach that Berling and the rest of the Owens & Minor management team, including Gil Minor, Hue Thomas and Bobby Anderson, used to grow their company.
Berling attended Villanova University near Philadelphia, which was run by the same religious order – Augustinians – that had operated a high school he attended. Not long after he graduated in 1965, his father announced he was going to sell A&J to what was then called Owens, Minor & Bodeker Drug Co. August Berling was ready to simplify his life a bit, while the Owens, Minor group was eager to expand beyond the wholesale drug business into med/surg supply, in order to become more competitive with another distributor, Durr Fillauer Medical of Birmingham, Alabama.
In the summer of 1966, while their father was spending the summer in Germany, Henry and his brother, Dick, handled the details of the sale of A&J. (Rather than cash, August Berling had insisted on equity in Owens, Minor & Bodeker.) Thus began a long career for the two brothers with the company. In fact, Henry stayed until his retirement in 2004, and Dick retired one year later. (Their father, August, stayed with the company until his death, working in DME, the repair shop and other areas.)
The growing years
“The days with Owens & Minor were full of excitement and opportunities,” recalls Berling. “We did the best we could, had some great success, and built a culture that our teammates relied on, and that we relied on too.”
From 1966 on, the company built its med/surg business organically and through acquisitions, including that of Powers & Anderson, Marks Surgical, Murray Drug, White Surgical and Southern Hospital. It continued to expand in the 1980s, beginning with the acquisition of Will Ross in 1981. In 1992, the company sold its wholesale drug business, and two years later, made its biggest acquisition of all – Stuart Medical in Greensburg, Pennsylvania, nearly doubling its size.
To make an acquisition succeed, the first thing you’ve got to do is trust the guy you’re buying it from, says Berling. “If you’re open and honest with that person, and you help them understand where you want to go, usually you’ll build their loyalty. The biggest thing, though, is, ‘Do they trust you to do what you said you would do?’ And we always did what we said we were going to do.”
Throughout all the acquisitions, the team worked to preserve its customer service orientation, sometimes to a fault. “I can’t tell you how many years we ran five or six systems, so customers wouldn’t have to face any changes in the way they did business with us,” he says. “We did things that nobody else wanted to do, and things they didn’t think we should do. But we did it for our customer base.”
Inside the company, Berling and the Owens & Minor leadership team worked to instill a culture of transparency, openness, integrity and respect. “We left our doors open all the time. It wasn’t rocket science. It was the leadership of the company, the way we treated the people who worked there.” And that culture spread to the companies it acquired, he adds.
Changing the model
“The key to the future is to change the model that exists today,” says Berling. In that spirit, Owens & Minor in 1985 signed on as an authorized distributor for the newly formed VHA Supply Company (now Vizient).
At the time, for-profit hospital company Hospital Corporation of America was bidding to buy the country’s largest med/surg supplier – American Hospital Supply (now Cardinal Health). (The deal ultimately fell through when Baxter Travenol stepped in to buy American.) American also happened to be the primary vendor for the young VHA purchasing group. So, rather than conduct business with a company owned by its for-profit competitor (HCA), VHA sought alternatives. Hence the authorized distributors.
VHA Supply sought a tough cost-plus deal with the distributors, a deal that Owens & Minor initially resisted. But eventually the two came to an agreement. True, the salesforce found the slimmer margins unsettling, says Berling. But because of the greater volume of business brought by the contract, most came out ahead. Another motivating factor for the reps: Taking business away from American accounts.
In the later ’80s and early 1990s, the company became a strong proponent of stockless purchasing and activity-based costing.
Shut up and listen
Today, Berling and his wife of 50 years, Carol, have four sons (two in the medical business), 14 grandchildren and two great-grandchildren. He has stayed in Richmond ever since graduating from Villanova in 1965.
“I have learned one thing interacting with people,” he says. “Since I wasn’t such a good student in school, I found that if you listen to people and pay attention, they will teach you more than you could ever learn by asking questions. And the industry is full of people like that.”
For example, when Berling was working as an OR tech one summer, a surgeon insisted on teaching him some anatomy. “I never said I wanted to know anatomy, but I found that if I kept my mouth shut, I’d learn some things.” Later, when Berling called on his first hospital lab as a young rep, he was asked if he knew what a CBC was. “I said ‘No,’” he recalls. “So he said, ‘Come back at 5 o’clock and I’ll teach you.’”
Berling remains busy in the industry today as co-owner of Custom Healthcare Systems, a custom kit maker in Richmond. And he stays in touch with friends and colleagues from Owens & Minor.
Of his career he says, “You never realize how good it was because as you’re doing it, it doesn’t appear to be anything other than what you should do. But it was a great run.
“Life goes by quickly. If you stop and pay too much attention, you’ll probably wonder what you’re doing. But if you believe in something, it can be a hell of a lot of fun.”