The Economics Of Bad Service

Roots Juice Bar At ODEL

An example of bad service at the ODEL Roots.


The Curionomist (great new blog) has a piece on the economics of bad service in Sri Lanka. He breaks it down roughly to competition, which I think is kinda true.

In Sri Lanka you can set up any number of businesses and be the first in that field, still. Many other companies also have age-old monopolies, or there are a few players which co-exist in a chummy statis. Disruptive innovations and competition are rare and quite possibly not rewarded.

Places can prosper by providing a basic service not that well and simply scaling up. It’s somewhat expected that in order to get good service you need to know the owner. But I think that is slowly changing.

The Curionomist focuses on competition, as per below:

If Serendib offered terrible service, I could just pop over to one of dozens of very similar places on either side of it or across the Lewis strip, with fairly similar prices. A case of near perfect competition. So, what keeps me there throughout the evening, and keeps me coming back? Good service quality. (The Irk Of Bad Service Quality In Sri Lanka)

I broadly agree, but I don’t necessarily agree that the Sri Lankan work ethic is bad. I just think it’s a family/feudal oriented culture that has yet to scale commercially. You can get stellar service at local or village kades where they treat you like family. You can also get amazing service anywhere if you know the lokka (owner or boss) and people have servants that will do nearly anything. I think Sri Lankans are naturally hospitable to people they know and, beyond that, a bit feudal.

Of course, that is changing. It has to. For a long time the pie wasn’t getting much bigger, so there wasn’t much incentive for competition. Now the pie is getting bigger (war is over, economy is growing) so competition matters again, and I think the Sri Lankan service ethic will modernize as incentives get in line.

RSS feed | Trackback URI

6 Comments »

2012-11-12 14:28:27

Sri Lanka has bad customer service because you are comparing it with what you get in modern day Europe or Northern America. I’m sure that if you compare SL with UK customer service 150 years ago you won’t be this depressed about it.

Note that even in SL, the more high class the place is, better the customer service is too. The high class places in SL aren’t quite up to the standards of the developed world, but they are better than the customer service you get from a bus conductor.

So you have a private bus in one end, and ministry of crab at the other end. There are many other things in the middle and you’d see the pattern.

 
Dinuka
2012-11-12 15:36:52

= ) SL customer service, 150 years and still in the making. The reality is that customer service isn’t so valued at a lot of places in SL (example of poor customer service from HSBC, SL Airlines, Vijitha Yapa, etc.) the reason being sales.
If you sell and you continue selling then customer service can take a back seat and if you complain all they’ll do is nod and smile. If you’re a big shot or moneyed then chances are you’ll get some kind of resolution but this “exception to the rules” attitude is bullshit but what can you do?
This is SL and we’re stuck with it…

 
suriya
2012-11-12 16:52:18

Im not sure that’s true. You get some really excellent service at local shops, kades, roadside restaurants.
Again feudal style the more they know you, the more ‘face’ you show the better that service becomes but it can definitely out compete service at virtually any high-end establishment. If im short 100 bucks of change Keells doesnt give me credit no matter how often I go but my local tuk driver and grocery kade are happy to.
Also places like the Galle Face hotel, Mt Lavinia hotel have abysmal customer service(try making an order and getting your bill) and they probably count as high end, plenty of ‘high-end’ establishments deal in rudeness and indifference and many raodside kottu stops have great service..

 
Pax
2012-11-13 06:02:54

I live in Aussie and this country has the worst customer service anywhere in the world. When you compare Aussie and SL I still feel Sri Lanka is bit far ahead, we still have the famous Sri Lankan hospitality.

Wathaatha
2012-11-14 10:12:24

Are living in Northern Territory?

 
 
sach
2012-11-13 08:56:15

I think this depends mostly on competition. In competitive markets there is high likelihood ppl would get better customer service. As in most SLn business fields we lack competition and as customers we really dont have any other alternative, so we cant expect customer service.

 
Name (required)
E-mail (required - never shown publicly)
URI
Your Comment (smaller size | larger size)
You may use <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong> in your comment.

email indi AT indi.ca.


Recent Comments


Anti Christian Christmas (2)

Jack Point: I found this video very disturbing. https://www.you tube.com/watch? v=EUHCQyxK3ps&a mp;feature=yout u.be http://dbsjeyar aj.com/dbsj/arc hives/27450

Jack Point: “these acts go under the radar because they’re on what my friend Dinidu calls ‘minorities within minorities’. The attacks are no less awful, however, and it’s sad the mainstream Muslims and Christians are not speaking out,”...

What A Colombo Revolution Might Look Like (Thailand) (5)

sharanga: Good constructive criticism.

sharanga: >the electorate is too ill-informed to decide This is almost always true in any country. It’s one of the greatest faults of democracy. The electorate is ill-informed and as public choice theorists put it, systematica...

Faz: What a ridiculous post Indi. I don’t even know where to begin with this

The Southern Expressway Bus (11)

Jack Point: Wy can’ these MORONS publish the damned timetable? Is that such a hard thing to do ? We have to go round in circles looking for info, no one knows exactly. Every website says contact 1919 but those idiots are only available...

The Cantaloupe Crash (10)

Iqbal: 5.5 million is a lot of money. Sounds about right. OMG 7 million for a wedding? Who organised it Cantaloupe? Did the poruwa crash doen around you? Either way you got ripped off machan. You ain’t no math wiz for sure. More like dim wit.

Iqbal: Indi, I think the official revenue figure was more like Rs 55 million for this Cantaloupe event. Which gives the directors pretty much what you say. I pity the fools that paid such an amount to have their NYE ruined.

Math Whiz: So there were 3500 tickets right? Normal Tickets were Rs. 10,000/- and VIP Tickets were Rs. 13,000/-. Just for the sake of argument let us go with the higher number of Rs. 13,000/- per ticket: 3500 X 13000 = Rs. 45,500,000/- There are 4...

Ali Baba And The NSA (1)

sack: I think you are forgetting the fact that most of the NSA type work (NSA is one among many) is done by private companies. In theory you can say that NSA employees are employees of the government who is doing a duty rather like soldiers. But...

What A Colombo Revolution Might Look Like (Thailand)

There’s a section of Sri Lanka – call them UNPers, elites, ESE, Ceylonese, whatever – that really really dislike Mahinda Rajapaksa and everything he represents. They’d like to see him thrown out of power at the least and tried as a war criminal at the most. This amorphous population, however, cannot beat him in elections and many don’t even vote. They do have disproportionate international connections so are featured a lot in international coverage of Sri Lanka, but they’re not especially influential within. I generalize because I’m talking broadly about a community I am or moreso was a part of.

Ali Baba And The NSA

There’s been a lot of talk about Edward Snowden and the NSA, specifically whether he should be hanged by his neck till dead or treated as a whistleblower. I lean towards the whistleblower side, largely because it’s really hard to take the side of a monolith like the NSA over one human being. There are a few points which have been bugging me.

Anti Christian Christmas

Shamefully, places of worship were attacked over the holidays – both Christian and Muslim. In this case the attacks seem to have been Muslims attacking Sufis (a sect) and claimed Buddhists attacking evangelical Christians. Both of these acts go under the radar because they’re on what my friend Dinidu calls ‘minorities within minorities’. The attacks are no less awful, however, and it’s sad the mainstream Muslims and Christians are not speaking out, let alone Buddhists.

The Cantaloupe Crash

Cantaloupe is an events management team that grew out of the old Colombo Nightlife crew, AFAIK. I’ve met a few of the directors and they’re nice enough, though those sort of events and nightclubs (Amuseum) are not my scene at all. They are, however, a scene which a lot of people seem to enjoy. Underneath that lifestyle, however, there’s always an undercurrent of violence and danger. This New Year’s Eve nobody shot off guns (which happens in Colombo), but an entire stage did collapse, injuring hundreds. There are limited ways to respond to such disasters, but not being prepared, not getting the injured to hospital as a priority and continuing the party have not represented Cantaloupe or the Hilton well.