Monday, April 15, 2024
Business & Economics

COVID19 Has Birthed The Ultimate Frankenstinian Monster of Corporate Austerity

We are experiencing unusually high call volume. Your call is very important to us and will be answered in the order in which it was received. Please remain on hold and your call will be answered by the next available representative. This refrain is common to those of us in English-speaking North America. It seems to have become more common in the age of the rona as companies are still struggling to retool their operations months into the global pandemic. Are they struggling to? Or are they refusing to?

In what I’ll call “classic” austerity, governments cut back services, usually because they’ve transferred control, power, or revenue streams to the private sector. We have numerous examples of how it doesn’t work very well to accomplish its stated goal of improving product while decreasing costs, whether from the military industrial complex, the prison industrial complex, or even city planning projects. But this is a more insidious model.

As a market becomes less competitive, switching costs for customers become higher, or, at the very least, more of a nuisance. The fewer options you have, the more a company has you hooked and unable– or unwilling- to look for alternatives. In this case, we’re talking about companies that could afford to hire more call center workers, but choose not to.

Anecdotally, I’ve encountered this “unusually long wait times” during COVID19 with Home Depot (over 1 hour hold time every time), Chase Bank (27 minutes), our private waste hauler and recycling service here in Detroit,  GFL Environmental (17 minutes). Amazon has more or less zero phone contact right now. Notice anything about these? All big businesses. Most of these are quite honestly too big to fail as a result of COVID19. But they’re still going to get nailed from an inevitable economic downturn, to the tune of trillions in market capitalization if not also profit.

Ah, you might say, shaking the finger on your invisible hand at me, but it costs them money to answer your calls. Their obligation is to their shareholders!

Yeah, I guess so. And the shareholders realize that profit can’t exist without revenue. Revenue can’t exist without sales. And sales can’t happen if your customer is pissed off and goes somewhere else.

You know who’s not failing to provide great service during this clusterfuck? Small businesses that are still open, either by virtue of being essential services or by virtue of figuring out how to still serve their customers. This is why I’ve largely figured out how to stop patronizing these big businesses for most things. Even if I am paying sometimes 50% more for a product, the savings of time and hassle are almost always worth it to shop from a local business.

Corporate austerity is just another hellish beast iconic to the strange age we live in. But it’s not the only way we have to live.

Nat Zorach

Nat M. Zorach, AICP is a city planner, community development professional, and MBA candidate at American University's Kogod School of Business, based in Detroit.

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