The world is Flat

I’m reading Thomas Friedman’s book “The world is flat.” He gives a story about a McDonalds franchise that outsources their drive-through to a call center in Colorado. Something stuck out in the story:

Though his operators earn, on average, 40 cents an hour more than his line employees, he has cut his overall labor costs by a percentage point, even as drive-through sales have increased… Tests conducted by outside companies found that [his] drive-throughs now make mistakes on fewer than 2% of all orders, down from about 4% before he stated using the call center.

He cut labor costs by a percentage point but he’s paying the operators more than his workers in the store? Having worked at McDonalds I can tell you that if you had stuck me in a room where I couldn’t get pulled off the drive-through to help do something else I would have been more efficient and a lot faster at my job. I can’t tell you how many times I would flip burgers and take drive-through orders--and then there was the time when I was riding around in a golfcart in the parking lot taking orders; hey I was 15! If I had been in a room with no outside work related distractions my job would have been totally different.

Now this example of outsourcing WILL come into play when they start shipping that job over to places where the market will allow for wages to drop substantially. But it’s a question of quality and competency, drive down the market too low and the quality of the worker—their education, NOT their competency as a human—will impact your business.

Another point is people shouldn’t be scared of these kinds of examples of technologies taking jobs. Technology isn’t inherently evil. It’s used the way it was developed. We have a top down authoritarian system and therefore we develop technologies to get rid of costly labor—otherwise known as humans who have certain basic needs. We could flip it around and create technologies that get rid of upper management if we wanted to. You don’t have to pay a CEO millions when you can outsource his job to a computer program.