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    Capitalism for Customers

    At the moment I'm in Prague for a conference. It's my first time back in almost two decades, since just after the Wall fell and the Czechs broke up with the Slovaks. I used to walk around this place with old Czechoslovak bills, still in circulation, which had been stamped in one corner with a "C" (or an "S") to indicate whether these were now Czech or Slovak crowns.

    When I was last here, I was occasionally amused by the flamboyantly gruff and rude service you sometimes encountered here, which I took to be largely about the previous decades of dysfunctional command economy. I remember showing up at movie theater on a deserted street one night, with no other customers in sight and only a handful inside, only to have the old woman behind the counter refuse to serve us until she had very very deliberately (indeed, increasingly slowly and deliberately) finished tacking up some flyer inside the ticket booth. My education had provided me with a handy explanation beforehand: in a non-market economy, where there's no profit, there's no reason to try to be more profitable, and no reason to please the customer. If they want a movie ticket, they can wait, and show you a little respect.

    I expected that two decades would make the Czech Republic more like the United States in this regard, with certain minimal standards of polite and reasonably efficient service when you're dealing with businesses. But over the last ten years, I've noticed that American customer service more and more often resembles the way Czech used to be about six days after they stopped being Communists. Perhaps I'm simply older and crankier, and more used to deference, but that seems not to be it, and I've had some downright surreal interactions when I was with someone else who could confirm that I was a) treated remarkably rudely by someone I was giving money and b) carefully polite myself. Over the last few months especially, I've had several experiences in the States that went beyond post-Communist Czech all the way to full blown Kafka.

    In theory, customer service in a capitalist economy should be good, since everything is driven by the desire for profit. Customer service should be especially good in a consumer-based service economy, because that's where most of the profit is. Yet, as the United States has increasingly become that kind of consumer economy, and simultaneously become more and more of a capitalist's paradise, customer service seems to be much worse than it was in, say, the 1980s. How could this be?

    The answer, I think, is that service jobs are worse in the States than they were twenty-five years ago: lower-paying, more demanding, less likely to carry benefits. And those jobs are no longer so much a stepping stone to better jobs as they are a whole sector of the economy. Service is bad because the people performing the service are paid badly and treated badly, and there's no profit motive to make them keep the customer satisfied, because they're not going to make any of that profit, even indirectly. A Communist-era waiter or ticket seller or bus driver had no economic reason to be efficient or friendly, because no matter how well they did their job it wasn't going to benefit them; nobody was making any money off this. An American working in a low-end service job today is in the same boat, or a worse one: someone is making money off their work, but doing it well doesn't get them anywhere. Doing a job well doesn't lead to a better job; there's just an endless series of crappy jobs. And the profit is all for investors: we've had decades now of hearing how overpaid workers cut into profits. If that's your mindset, you can't expect workers to be motivated by pay or profit. They don't get any.

    The Czechs are better at customer service now, some of the time. (The rest of the time, well, they're still a Slavic culture and dealing with tourists is a pain in the ass.) But things aren't looking up for us in the States.


    My most entertaining experience in Prague (1993) was a meal at a restaurant in which one of my friends had a fly in her soup. The waiter was not rude but utterly stone-faced as he removed the offending soup. Meanwhile, the doorknob to the room kept falling off, and the stream of befuddled patrons trying to replace it after it came off in their hands added to the Fawlty Towers atmosphere. Finally, a German tourist from another table ran over to ours with a slab of steak in his head. Delightedly crying, "Look what happens when I cut the meat," he proceeded to saw ineffectually at the impenetrable slab with a knife, laughed hysterically, and ran back to the table.

    Good times. I also miss the cheap pilsners.

    I haven't noticed a decline in customer service in the US, but NYC always had a pretty low bar.

    This probably sounds like fuddy-duddy talk, but some people raise their kids with manners, and some don't.

    My in-laws put us up for a week at the Basin Harbor Club, in Vermont, quite a few years ago, and I have never met a more polite, attentive bunch of teenagers and young adults as they had on the staff. As an example, we were a little early arriving, our cottage wasn't ready, but rather than let us and the children cool our heels, a young man took us on a quick golf cart ride around the facilities and explained when things opened, etc. It was a much better intro to the place, and it reminded me of what I heard about Nordstrom's empowering their employees to satisfy the customer. I suspect that any young person working there that couldn't show interest in the customer would not remain long.

    Off topic, it was about the most Republican place I've ever been. After aerobics, my wife asked another guest where she worked, and the woman replied, "Work?" There was even a fellow guest that looked a lot like Newt Gingrich. I played doubles with him, and he was a nice guy, but we all called him little Newt.

    It's that lower-paying, more demanding, less likely to carry benefits aspect that gnaws away at the pillars of customer service.

    I work as a janitor at a bowling alley on a military base ... B.S. in Business Admin and half way thru a Masters and both manager and his assistant have none - go figure. A few months back, the head cook was frustrated and was venting her anger. Seems she keeps a tight control over the money in the cash register and knew her section was  drawing tons of cash into the facility. Her anger was with all that influx of cash, pay raises were few and far between. She couldn't understand why she and her workers weren't getting salary increases based on the income they generated for the facility.

    I had to sit down and carefully explain to her that her position was minimum wage. That meant each pay raise she received was based on the amount of time she spent working at a specific pay band. And those pay bands were based on a 40 hour work week so part-time employment meant it takes longer to move up.

    Not convinced, she argued that there should be some incentive program to reward workers that exceed expectations and generate a cash flow greater than what management anticipated. I replied that while that was a possibility, it was the manager and those above him who would decide if such a program was necessary. In other words, if the top tier management level was only interested in increasing their profits while keeping production costs at minimum levels fat chance workers would be rewarded for their efforts no matter how much profit they generated.

    Unfortunate for her,  military installations has a ready supply of spouses and dependents willing to work part-time to earn a few extra dollar to satisfy their spending habits ... they're not interested in careers. That gives management an inexpensive workforce that frequently turns over in less than a year, but saves them tons of money in not having to service medical, retirement, paid sick leave or vacation time.

    Yeah, basically this is the story, all over America.

    You might note that this is a bit like talking 2011 India only based on curry houses and Bhagwan ashrams, and forgetting computing in Bangalore and Mumbai and elsewhere. Much of the Czech economy is providing outsourcing for booming Germany and other economies - including automotive sector, chemicals, manufacturing and IT - DHL has one of its 3 world IT centers in Prague, while SAP has its major SW development & support house.

    It's also based on how Czechs treat foreigners rather than how they treat other Czechs, which are very different parts of the economy. In a communist economy, tourism was a big deal due to foreign hard currency. In a modern economy, it's more about production, and how many factories have been converted to profitable enterprises, and how many modern techniques for production, development and management have been successfully adopted. You won't get these walking around a conference or the tourist sections of town.

    In fact in summer, you might find that most Czechs are off vacationing in the Mediterranean climes.

    Who said my earlier experiences, when the service was awful, was in the tourist part of town?

    The lady at the movie theater on the deserted street wasn't in the tourist zone. And I was with Czechs.

    All services in earlier times were awful. Except maybe prostitution, but likely that as well.

    Now, as you say, it's basically the way it is with the French. Exasperated with tourists and occasionally surly, but in a purely first-world way.

    I read an article once about a consultant who was trying to teach American-style customer service to the French. It wasn't just tourist land. There was a funny anecdote in which the consultant (under cover) tried to get advice from a salesman on what printer to buy. The obviously annoyed salesman pointed his foot at one. When the consultant asked why that one, the salesman shrugged, "Some people like Renault cars, some people like Peugeot. I prefer that one."

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