Ethnographic study explains how to get better tips without sacrificing dignity

While in graduate school, one sociology student collected data from his job as a delivery man on how to collect the best tips:

So in the year that Thompson worked for Jake’s—not the restaurant’s real name, but the moniker the sociologist gave the calzone spot in a paper he published in the Journal of Contemporary Ethnography last year—he found ways to bring in money without sacrificing his dignity. There was one semi-official rule, passed down from Jake’s laid-back manager: You can’t outright ask for tips. Everything else was left up to Thompson and his band of fellow delivery guys.

Here are a few of the tips (and there are nine total):

Look Like a Customer

One of the Jake’s drivers found that his tips were better when he was clean-shaven: A furry face, he found, usually netted him about $2.00, but a clean one landed $2.50, or sometimes even $3.00. Do calzone lovers hate beards? Probably not, the driver theorized—it’s just that the college students he delivered to thought he was younger without the beard. Customers, he found, were more likely to tip if they thought he was a student, too…

Love the Pets

“You know what really works?” one driver asked Thompson. “Dogs. You compliment their dogs.” The driver said that he got down on the floor and played with customers’ pooches. It worked. “They gave me a five!” he said.

The Receipt Trick

One of Thompson’s personal favorite tricks came at the very end of the delivery interaction, when a customer using a credit card had to sign the receipt. If she left the tip line conspicuously blank, Thompson would turn back to her and say, “Sorry, boss needs you to fill out the entire thing!” That forced the customer to either come out and admit that she was purposely stiffing him, or wilt under his passive aggression. Cha-ching!

The Change Trick(s)

There are a few ways to pull the change trick. The first, another one of Thompson’s favorites, was wide-eyed innocence. “Great, a five dollar tip!” he would exclaim if a customer had given him a nice round bill, possibly hoping for change. “Awesome!” Only the customers who really, really wanted to leave a bad tip—and were willing to go through a very uncomfortable social interaction to do so—would demand their change back.

Two quick thoughts:

1. Training in sociology, particularly in face-to-face interaction, could go a long ways here. A number of these tips involve manipulating the particular social situation to the delivery person’s advantage. Instead of feeling embarrassed to be chasing a tip, the onus can effectively be put on the purchaser to go out of their way to not give a tip. In other words, this is all about impression management.

2. There is some interesting work in sociology regarding jobs or situations where money is clearly involved but can’t be discussed. This is one; it is uncouth to openly ask for a people but people can be acceptably nudged. Or in the art world, artists can’t quite openly say that they are in it to become wealthy but they clearly need to sell art to survive (and to gain status). Or, certain items like life insurance have to become morally acceptable (a process traced by sociologist Viviana Zelizer) before people will purchase them. Even in our world where economics and money seem like pretty powerful forces, there are still social constraints.

Male British hedge fund employees worried about their appearance, link it to wealth

Even as women are presented with pressure in regard to their appearance, some men face similar pressure. Take this case of male employees at a British hedge fund:

We got our hands on an academic paper published last week by the British Sociological Association, which muscles into the attitudes of male traders towards their bodies, ageing and fitness, as observed at one (thus far unidentified) City-based hedge fund…

According to the study, titled, “Built to last: ageing, class and the masculine body in a UK hedge fund,” people at the mystery fund admit they get teased for not keeping fit, think affluence is linked to physical activity and exercise to offset the negative perceptions of ageing … oh and er, lie about getting work done.

“Conversations on the floor suggested that traders explicitly rejected or mocked the idea of Botox or other forms of cosmetic treatment,” goes the report.

“Yet, during interviews some mentioned dyeing their hair, having regular massages or going on an intense boot camp holiday in order to ‘fix’ parts of their body.”

The acceptable masculine appearance in this setting is interesting. But, it would then be worthwhile to hear more about how appearance gets linked to success and status within the firm. Do fellow employees perceive fit workers to be more successful? Do they get earlier promotions? Did male traders always have to be fit or get benefits from being fit or is this a relatively new phenomenon? This may be another piece of evidence that economic trading is not just about the numbers. As a number of sociological studies have found, other factors other than individual talent or intuition affect abilities in the finance industry including emotion and social networks.

A rising ideology of shareholder value in the United States

How and why corporations make decisions has changed over the decades. Here is a quick argument of what has changed in the US:

Such is the power of the ideology known as shareholder value. This notion that shareholder interests should reign supreme did not always so deeply infuse American business. It became widely accepted only in the 1990s, and since 2000 it has come under increasing fire from business and legal scholars, and from a few others who ought to know (former General Electric CEO Jack Welch declared in 2009, “Shareholder value is the dumbest idea in the world”). But in practice—in the rhetoric of most executives, in how they are paid and evaluated, in the governance reforms that get proposed and occasionally enacted, and in almost every media depiction of corporate conflict—we seem utterly stuck on the idea that serving shareholders better will make companies work better. It’s so simple and intuitive. Simple, intuitive, and most probably wrong—not just for banks but for all corporations.

As Cornell University Law School’s Lynn Stout explains in her 2012 book, The Shareholder Value Myth, maximizing returns to shareholders is not something U.S. corporations are legally required to do. Yes, Congress and regulators have begun pushing the rules in that direction, and a few court rulings have favored shareholder primacy. But on the whole, Stout writes, the law spells out that boards of directors are beholden not to shareholders but to the corporation, meaning that they’re allowed to balance the interests of shareholders against those of stakeholders such as employees, customers, suppliers, debt holders, and society at large…

To be sure, the case against putting shareholders first is not quite the slam dunk for all corporations that it is for highly indebted, too-big-to-fail financial institutions. Outside of banking, the empirical evidence against the doctrine is more suggestive than dispositive. Supporters of shareholder rights can point to studies showing that certain shareholder-friendly changes, such as removing defenses against hostile takeovers, tend to bring higher share prices. Skeptics argue that this says little about long-term impact, and point instead to a more expansive, but impressionistic, set of indicators. The performance of U.S. stock markets since shareholder value became doctrine in the 1990s has been disappointing, and the number of publicly traded companies has declined sharply. The nation in which shareholders have the most power, the United Kingdom, has an anemic corporate sector; on Fortune magazine’s list of the world’s 100 largest companies, it claims only three, compared with nine from France and 11 from Germany, where shareholders hold less sway. Multiple studies of corporations that stay successful over time—most famously the meticulously researched books of the Stanford-professor-turned-freelance-business-guru Jim Collins, such as Good to Great—have found that they tend to be driven by goals and principles other than shareholder returns.

Collins’s books embody the most common criticism of shareholder value: that while delivering big returns to shareholders over time is great (it is, in fact, Collins’s chief measure of “greatness”), focusing on shareholder value won’t get you there. That’s what Jack Welch was getting at, too. In a complex world, you can’t know which actions will maximize returns to shareholders 15 or 20 years hence. What’s more, most shareholders don’t hold on to any stock for long, so focusing on their concerns fosters a counterproductive preoccupation with short-term stock-price swings. And it can be awfully hard to motivate employees or entice customers with the motto “We maximize shareholder value.”

Corporations and what their directors want, what their investors want, and how they operate changes over time based on surrounding economic and social forces. They can also innovate and develop new ways of pursuing profit or contributing to the public good. Thus, to understand them, invest in them, and develop regulations and policies involving them, we need to know their social context and their patterns of development.

One of the more interesting books I’ve read related to this topic is Frank Dobbin’s Forging Industrial Policy: The United States, Britain, and France in the Railway Age. Dobbin shows there was no “right” way to promote and develop railroads. France’s approach was to develop a centralized railroad system based on Paris and highly regulated by technocrats. Britain took the opposite tack: no regulation to start as railroad firms could build and do what they wanted. After a while, Britain had to introduce regulations because corporations were putting profits first over public concerns like railroad safety (an example: a need to regulate railroad brakes to avoid large crashes). The United States took a middle approach: some public-private partnerships with some regulation but also with the ability for corporations to make big money. Looking back from today, the “right” way might seem obvious but this whole process was strongly driven by social and cultural circumstances and norms.

Knowing all of this, perhaps the next question to ask is how might corporations change in 20 or 50 years?

British economics writer: economics has failed but are the sociologists ready to step up?

This is an interesting viewpoint: “Mainstream economic models have been discredited. But why aren’t political scientists and sociologists offering an alternative view?” Here is some of the discussion about how sociology has failed to seize this opportunity:

Perhaps you have more faith in the sociologists. Take a peek at the website for the British Sociological Association. Scroll through thepress-released research, and you will not come across anything that deals with the banking crash. Instead in April 2010, amid the biggest sociological event in decades, the BSA put out a notice titled: “Older bodybuilders can change young people’s view of the over-60s, research says.”

Or why not do the experiment I tried this weekend: go to three of the main academic journals in sociology, where the most noteworthy research is collected, and search the abstracts for the terms “finance” or “economy” or “markets” since the start of the last decade.

Comb through the results for articles dealing with the financial crisis in even the most tangential sense. I found nine in the American Sociological Review, three in Sociology (“the UK’s premier sociology journal”), and one in the British Journal of Sociology. Look at those numbers, and remember that the BSA has 2,500 members – yet this is the best they could do…

It wasn’t always like this. One way of characterising what has happened in America and Britain over the past three decades is that people at the top have skimmed off increasing amounts of the money made by their corporations and societies. That’s a phenomenon well covered by earlier generations of sociologists, whether it’s Marx with his study of primitive accumulation, or the American C Wright Mills and his classic The Power Elite, or France’s Pierre Bourdieu…

Nor is there much encouragement to engage with public life. Because that’s what’s really missing from the other social sciences. When an entire discipline does what the sociologists did at their conference last week and devotes as much time to discussing the holistic massage industry (“using a Foucauldian lens”) as to analysing financiers, they’re never going to challenge the dominance of mainstream economics. And it’s hard to believe they really want to.

Ouch.

I can imagine some sociologists might argue that the world is much bigger than markets and economics. They would not be wrong. At this same time, this critique could be viewed as a call to action: does sociology offer a compelling alternative way to view the world? How can we account for both economic and social life?

I will say that there does appear to be growing interest in economic sociology. This may not be reflected in these particular journals but more sociologists are looking at the social and cultural dimensions of economics. As noted, this was a key concern of a number of foundational sociologists, observers who noticed that industrialization was changing the social world. I wonder how many sociologists would view studying the economic realm as something “dirty” (too many ties to capitalism, too messy, too close to economics, etc.) or “uninteresting” (not what really motivates them to research, teach, and engage in public life).

Quick Review: Boomerang

Michael Lewis’s latest book, Boomerang, gives the current economic crisis some international context. In an entertaining and somewhat breezy manner, Lewis investigates why countries as disparate as Iceland, Greece, Germany, and the United States all fell into the economic mess. Here are a few thoughts about his take:

1. My overwhelming thought about Lewis’s explanations is that he wants to delve into different cultural approaches to the world of finance. Lewis’s argument goes like this: even though these countries have very different histories and cultural mindsets, somehow they all got involved with bad debt in the 2000s. This same topic could spark a fascinating economic sociology or cultural sociology manuscript.

2. Unfortunately, Lewis either doesn’t have much time to spend with each country (he admits the book began as he was working on understanding the US system, which became The Big Short or he doesn’t want to delve deeply into his thin arguments. For example, in Germany he tries to tie their fondness for following rules (which means Germans were the last people to be being disastrous American CDOs) to their fondness for scatalogical humor (which Lewis bases on one anthropological study). While there is a lot of potential here for showing how different cultures can be tied together by a global finance market, Lewis needs a lot more evidence to construct a convincing argument.

3. I found the last chapter to be both exhilarating and depressing. Lewis comes back to the United States in the final chapter and describes how this could all play out. Here is what Lewis suggests: while the centralized governments of Europe struggle, the problem in the US is pushed down the road because the federal government can push off more and more obligations on state and local governments. If this plays out as Lewis suggests (though there is debate over whether it will be as bad as Meredith Whitney suggested), local governments will continue to feel the pain of the economic crisis for years to come and the results may not be pretty.

Summary: I think Lewis is on to something here but I would like to see the topic covered with more depth and include more research.

Sociologist Richard Sennett: Wall Street offices lack cooperation

After talking with a number of workers involved in the Wall Street troubles of 2008, sociologist Richard Sennett argues that Wall Street offices lack cooperation:

The financial industry is a high-stress business that requires people to work extremely long hours, sacrificing time for children, spouses and social pleasures. But after 2008, many of my subjects were no longer willing to make those sacrifices. Looking back, they realized how little respect they had for the executives who’d worked above them, how superficial was the trust they had for fellow workers and, most of all, how weak cooperation proved in the wake of financial disaster.

The fragility of this social triangle is disturbing. When informal channels of communication wither, people keep to themselves ideas about how the organization is really doing, or guard their own territory. Weak social ties erode loyalty, which businesses need in good times as well as bad. Many of the employees I’ve been talking with have come to feel embittered by the thin, superficial quality of social ties in places where they spend most of their waking hours…

Even for those workers who have recovered quickly, the crash isn’t something they are likely to forget. The front office may want to get back as quickly as possible to the old regime, to business as usual, but lower down the institutional ladder, people seem to feel that during the long boom something was missing in their lives: the connections and bonds forged at work.

This is an example of how sociology can help inform economics and/or social policy. In order for offices or any social group to work well, there has to be trust, solidarity, and cooperation. These traits cannot simply be dictated or ordered. Rather, relationships and social ties need to be started, developed, and maintained over time. These relationships may seem silly or unnecessary to some but it will be difficult to accomplish great things without them.

I expect an analysis like this is just the beginning of a flood of academic work and commentary about the recent economy crisis. And I would guess that a lot of research will show that people were not acting “rationally” but rather were working off of different emotions that led to “irrational exuberance.” Cultural and social factors played a role but it will up to scholars to determine how much.

The benefits of Best Buy’s flex schedules for employees

Two sociologists have published a study in the American Sociological Review that shows that employees at Best Buy’s headquarters benefit from flex schedules:

Sociology professors Erin Kelly and Phyllis Moen said a flexible work schedule that focuses on results and not just activity cut turnover at Best Buy’s Richfield headquarters by 45 percent while improving productivity.

The flex schedules, they said, cut down on stress and work interruptions due to personal issues because employees were able to find a better balance between their work and home lives…

The U of M study followed 600 workers for eight months after the start of the program, 300 who worked under the flex plan and 300 who continued working the traditional 9-5 day…

The study showed that 6 percent of the employees working under the flex plan left Best Buy during the study period, while 11 percent of the control group left during that time. Also, the results were about the same regardless of gender, age, tenure, job satisfaction, and stage of life.

Turnover can be a problem for companies who then have to hire new employees and train them so cutting turnover even five percent is no small matter.

Based on the success of the program, Best Buy has changed some of their practices:

The research showed that the flex program led to Best Buy getting rid of “low-value work,” such as unnecessary meetings. The researchers said staff and supervisors started re-considering their work patterns, figuring out what activities were the most productive.

It would be interesting to see exactly how the employees in the flex program talk about these changes. And I would be interested in hearing more about this trade-off in a company stressing results rather than activity – are there downsides to this?