Bad Customer Service and Short-Term Contracts

Customer service in Filipino stores is atrocious. It’s not easy to have really bad customer service when you are as over-staffed as these stores are, but somehow they manage it. Restaurant and fast-food service is terribly slow (20-30 minutes is normal wait time for a meal in a ‘real’ restaurant, and fast food places generally have long lines that seem to never move). Supermarket check-out lines are also long and slow-moving. Employees are frequently unable to answer the simplest questions.

I’ve been most bothered by it, recently, in grocery shopping. At the store where I shop most often, the checkout lines are, as mentioned, absurdly long, with usually only about half of the lanes open (at peak hours). The store is, like most Philippine retail outlets, heavily overstaffed by Western standards, and there will be dozens of people stocking the shelves (or pretending to stock the shelves while chatting with each other) while customers stand in line. Often some of the lanes will have no baggers, slowing things further, as the cashier bags items (again, despite the many people stocking shelves).

(In case you are going to ask why I continue to shop there, the answer is that all the alternatives are exactly the same).

I’ve heard a number of reasons given for the Philippines’ customer service deficiencies, all of which I agree with at least somewhat. Here are a couple that are often suggested among expats discussing this issue:

• Filipino customers don’t know any better. Customers in these stores have never experienced good customer service, so their expectations are low and they won’t complain. 
• There’s no competition. Most business categories in the Philippines (including retail) seem to be organized on a cartel basis, so that ‘competitors’ have no incentive to improve their processes in such a way that they differentiate themselves. Foreign competitors who would introduce better practices and shake up the cartel, are excluded by the government's protectionist policies.

No doubt these are a big part of it, but I think it has mostly to do with the wide-spread Philippine practice of hiring employees on short-term contracts, in order to avoid paying benefits. The law apparently says that temporary employment cannot exceed six months, so contracts are shorter.

The ways that such a practice impact customer service are pretty obvious:

• Poor training. What’s the point of putting a lot of time and effort into training people who will be gone soon?
• No cross-training. If initial training is a waste of time, that goes double for cross-training. In a US supermarket, stockers are cross-trained to work the check-out lanes during peak times.  
• Lack of knowledge. Inexperienced and untrained employees are of course less able to answer customer questions or deal with problems.
• No incentives. An employee who has no hope of getting a promotion, and in fact knows s/he will be laid off in a few months, has no reason to care much about the company or the customer.

As employers in the US seek ways to avoid Obamacare, this practice might spread; but it seems the preferred way of avoiding benefits in the US is through part-time employment. Most temporaries there are just for seasonal work or specialists called in for projects (e.g., consultants).