Aug 25, 2008

Good service - Part 2

While we don't seem to be sure what explains good service in restaurants-is it tips, the weather or culture-, here's a natural experiment one could write on, and show how economic incentives alter the quality of service, in electronics megashops, this time.
Future Shop, a canadian electronics chain, pays its employees more when they sell more. Basically, the salesmen get a share of what they manage to sell, a scheme similar to tips. One could expect good service from this scheme, but what actually happened was perceived more like harrasment than good service by the Quebec consumers. Best Buy's promotion (the American competitor) lets people know that its employees have a fixed income, therefore are not annoying, and hence the service is better!
According to my experience, you get better service at Best Buy, so the economic incentive to sell more would not translate into better service. But then again I am not controlling for ethnicity, which is extremely diverse among electronics salesmen! Company culture could be the explaining factor (more than country culture), which should be determined by competition, or simply reflect the culture of the CEO.

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