Feedback Matters in Customer Service

This EconTalk podcast features a panel discussion on the future of work, featuring Andrew McAfee, Megan McArdle and Lee Ohanian.

Host, Russ Roberts, makes a good point about 29 minutes into the podcast. They are discussing how people differ from artificial intelligence. McArdle points out that there is value in charm. McAfee isn’t so sure. He says:

But think of your last 10 service interactions with another human being. How many of them left you with that warm, chamomile tea feeling?

McArdle say most of them. McAfee responds:

Oh, come on, did you walk through a sea of pleasant experiences in the airports on your way here? If so, I want to travel with you. [Or] When you call up Comcast, when you go–

Roberts points out that these are outliers:

You’ve picked the example of the places in America where there is very little competition due to regulation and government monopoly.

Good point. Not all customer service experiences are great, but certainly the ones from the companies that compete for your business are better than those that don’t. Everybody dreads going to the DMV. Most people are okay with heading to McDonald’s.

Megan McArdle on Failure

I agree with most of what Megan McArdle has to say about failure in this EconTalk podcast.

Why is failure valuable?

…because that’s how we get information.

What about the typical success story?

…when you see the cover of a business magazine, it’s always this genius with his folded arms staring at you and the piece goes through all these brilliant ideas. But in fact when you talk to entrepreneurs, that isn’t how they experienced it. Usually how they experienced it was: We had this great idea and then it turned out that didn’t work, so we did something else. Or it turned out: It didn’t work and we went out of business.

Where do we learn to start avoiding failure?

…having failed is an important skill that kids need to learn. And the right time for them to learn it is when they are kids. And when the consequences for that are actually pretty low.

One of the book talks that I gave, a 10th grade girl came up to me afterwards and she said, You know, I would really love to try to fail, but I’m in an AP (Advanced Placement) program; only 5% of the people who are in the program are going to get a 4.0; and I just can’t afford to take a class that I wouldn’t get an A in.

And I just thought: America, you are doing it wrong. It’s not that kids shouldn’t work hard in school. That’s not what I’m saying. But the idea that at the age of 15 you have to be so self-protective that you can’t take any risks at all is insane. Because when is going to be a better time? When she is looking for an assisted living facility?

I might rephrase that first part, though. Having failed isn’t the important skill. Learning to deal with failure is and learning to overcome the fear of failure is another important skill.

It seems like soon after we get past the trials and errors of learning to walk, run, talk and ride bikes, we forget that trial and error is how we learn and we tighten our tolerance for error.

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Pity to folks on the bunny slopes of writing

Megan McArdle says that she tries not to write bad reviews to avoid the lack of substance of ‘snotty putdowns’, by making…a snotty putdown (HT: Instapundit):

But if you’re basically pretty good at snotty putdowns — and most bloggers have at least an apprentice-level facility with this art — it’s almost too much fun. It’s too easy. It’s the writing equivalent of skiing the bunny slope.

I’m not a fan of McArdle’s writing. Credit to her for building an audience that can pay her bills (partly off her snark), but I’m not one of them. I tried. But, I find her to be a bit too full of herself.

I sometimes think she makes good points and helps advance discussions. But, more often I’m turned off by her snotty and elite attitude.

When I saw the link to this article on Instapundit, I thought perhaps she decided to turn over a new leaf. Like maybe the reason why she decided to try not to be snarky was that she realized that she could be wrong.  That while she didn’t find much use in something that she reviewed, her opinion may be proven wrong.

But, no such luck. Now, it appears, that she now believes she has graduated from “bunny slope” of writing. Good for her.

There are parts where I agree with her. Like here:

…it seems to me perfectly adequate to say “This person is wrong, and here’s why.”

Though, I’d edit that to say “I think this person is wrong, and here’s why”, because it’s good to leave open the possibility that I’m wrong and that I don’t nearly have as much figured out as I think I might.

This can allow you to get past the window dressing of who is more clever in their comebacks and get to the heart of the disagreement.

But, I think I would be misdirected to say any snark is bad. Glenn Reynolds’ Instapundit, for example, is snarky, too. But, his snark is different. It’s not about, as McArdle writes, “Look at me! I am so smart and funny! Not like this stupid person I am making fun of! You should think less of them and more of me!”.

He doesn’t use snark to elevate himself above others, as one example illustrates. When linking to articles of the IRS audit scandal, Reynold’s likes to remind his readers that Obama joked about auditing his enemies in 2009.


Where does the Laffer Curve bend?

Laffer Curve

What is t*?

Thomas Sowell says that when tax rates are raised on high-income individuals, they respond to incentives by arranging their financial affairs differently to minimize those taxes.

Folks, like blogger Megan McArdle, lecture/patronize opponents of tax increases that current marginal tax rates are not near the bend in the Laffer Curve (the point where increasing tax rates would reduce revenue).

This is from Mark Perry’s blog, Carpe Diem:

The U.K. government is learning about the economic lesson that “if you tax something, you get less of it.”  Following an increase in the top marginal income tax rate to 50%, tax revenues from high-income taxpayers are falling, and are not going up, as the Treasury somehow expected by ignoring the economic lesson that “people respond to incentives.” A U.K. Treasury official explained the disappointing drop in tax revenues by saying it “was partly due to highly-paid individuals arranging their affairs to avoid paying the 50% rate.”  Duh.

A refreshing look at jobs

I much prefer Phil’s take (HT: Arnold Kling) on jobs to Megan McArdle’s.

From Phil:

The same technology that is eliminating jobs also connects us and empowers us in ways unimaginable just a few years ago. Maybe what’s becoming obsolete is not jobs per se, but the idea that they are something that you simply find.

Increasingly, perhaps, a job is something that we each have to create. We can’t count on someone else to create one for us. That model is disappearing. We have to carve something out for ourselves, something that the machines won’t immediately grab.

That sounds difficult, maybe even a little dangerous. We’re all comfortable with the idea of “finding” a job. We search for them; we hunt them; we land them. All of these images assume the job already exists.

But to create something new…what does that even mean? Do we all become entrepreneurs? (I think the answer to that question is yes, although many of us will have to learn to be entrepreneurs within existing organizations.) Ultimately, it means we have to find something useful to do, something so useful that others are willing to pay for it.

In other words, as my grandparents use to say, go out make yourself useful to somebody.

Who moved my cheese?

On her blog, Megan McArdle writes in post called, A Tentative Defense of Breaking Windows:

The heart of the argument is this: prolonged unemployment is basically the worst economic event that can happen to a person in America.  Losing your home, declaring bankruptcy, or having your life savings stolen are awful.  But as long as you are working, those things can be replaced–maybe never as good as they were, but certainly adequately.  A lengthy spell of unemployment robs you of social status.  It steals your piece of mind.  It embezzles your accumulated skills and contacts.  It beats your sense of self-worth into a bloody pulp.  And like all crime victims, it leaves you permanently afraid in a way that you never were before.  And that’s if you get a job.  Except that one of the worst parts of being unemployed for a long time is that it gets harder to get another job with each passing month.

Megan seems to overlook the simple solution here.  As several of my grandparents use to tell me, get off your duff and go make yourself useful to someone.

It may not be your ideal job.  It may not pay what you were making before.  It may be temporary and ‘beneath’ you.  And it may lead you into a highly successful career path that you would have never considered.

I can’t remember exactly where I heard this story.  Seems like a radio show like Dave Ramsey or maybe even NPR.  It’s a story about a woman who lost her job.  She went to Home Depot and bought $10 worth of window washing equipment and started knocking on doors offering to wash windows.  Within a couple years she had a window washing company with several hundred thousand dollars a year in sales.

What about those of you who do have a job?  Are you saving an emergency fund?  Are you broadening your skills, taking advantage of your company’s training and education programs and getting varied experiences so that you might be able to transition to something else easier?  Are you managing your expenses so you could live on much less income if you have to take a lower paying job?   What thought have you given to your backup plan?


Some tidbits I’ve read and heard from your recent speech concern me.  Like this one (by way of  Megan McArdle’s blog):

Let’s start with a big, positive goal. Let’s grow the economy by 5%, instead of the anemic 2% currently envisioned. Such a national economic growth target will set our sights on a positive future. And inspire the actions needed to reach it.

We don’t need politicians setting national growth targets.   This part of your speech is  better:

The United States is still home to the most dynamic and entrepreneurial people in the world. They’re all around us. Ready to innovate, invest, compete and create new businesses and jobs. That will mean opportunities for everyone.

They’ve been discouraged and weighed down. By President Obama’s big government. And heavy handed regulations. They deserve a better deal. I’ll give them one. And here it is.

Though, you can buy yourself some ears if you don’t just pin big government on Obama.  He has contributed, but so did pre-08 Republicans and Congress in general, who have put politics ahead of behaving like adults.  Don’t let them off the hook.

Here’s the version of this part of the speech I would have edited for you:

The United States is still home to the most dynamic and entrepreneurial people in the world. They’re all around us. Ready to innovate, invest, compete and create new businesses and jobs. That will mean opportunities for everyone.

They’ve been discouraged and weighed down. By our big government.  And heavy handed regulations. They deserve a better deal. I’ll give them one. And here it is.

We need to get government out of the way and let innovative Americans do what they do best.  Find ways to serve their fellow citizens in ways that their fellow citizens want and value.

How many of you know what tax rate you will be paying this year?  How about in 2013?  Do you feel confident that you know what your health insurance will look like in two years?  These uncertainties help prevent new job formation.

Our government has grown its spending by 93% since 2000 while the size of our economy has grown by 42%.  We cannot grow the bureaucracy of government at more than twice the rate of our economy and expect the economy to remain healthy.

Bureaucracies do not meet the needs and wants of our fellow citizens as effectively as our fellow citizens.  Government bureaucracies are like the DMV.  We need less of that and more ingenuity and freedom.

What will health insurance look like on the new exchanges?

Here’s a reasonable guess from Megan McArdle:

What people are expecting seems to be a very expensive form of insurance (no gatekeepers or restrictions) on the cheap.  What they’re going to get is cheap insurance that they will be forced to buy.

Or as the Rolling Stones put it, You Can’t Always Get What You Want.

Here’s my comment to Megan’s blog post:

Remember the ’08 election issues? Solving the perceived problem of 45+ million uninsured was a major one.

Who knew it would be so easy to fix? Simply make it unlawful for these 45+ million to choose to be uninsured. Problem solved.

Just think of all the things we can solve.  Maybe we should outlaw unemployment.

Megan Liked My Comment

Last week I posted a comment to this post about Starbucks putting quality over quality on Megan McArdle’s blog on The Atlantic’s website.

Megan then posted my comment in her next blog post, writing that

A reader offers this perspicacious take on Starbucks.

I had to look up perspicacious.  It means:

Having keen mental perception and understanding; discerning: to exhibit perspicacious judgment.

I always find it an honor when someone likes something I wrote.  Especially so when that someone writes professionally on similar topics.

Thanks to Megan for posting my comment, the compliment and expanding my vocabulary.

My comment that she posted was:

I suggest the title: “Starbucks is firmly in the tinkering stage”.

All retailers see their sale growth shrink to single digits once they saturate the market geographically. They then enter the tinkering stage where they try things like this that usually have roughly net neutral trade-offs.

Focus on quality (or consistency) and you attract clients that value that and lose some that value convenience. Focus on convenience and you lose those looking for quality.

But, it never hurts to experiment. After all, nearly all successful products and business are the result of a successful experiment.

To this post I modified the thought, adding that experiments can hurt.  But, for a business to move forward it needs to experiment.

Of Course Not

Here’s a crystal clear observation from Megan McArdle and I love crystal clear observations.

In this blog post of her’s, Megan writes about Harvard Econ professor Greg Mankiw’s New York Times column about his tax rates that, to use Professor Mankiw’s words, inflamed “the left-wing blogosphere.”

Megan writes about those inflamed left-wing bloggers:

Interestingly, no one thought it was odd that they should have opinions on Greg Mankiw’s taxes; apparently, it is only opinions on your own taxes that are in bad taste.

Nice work Megan.