Thursday, May 31, 2012

IHoP #1466 -- An Allegory of Socialism's Failures

On Wednesday May 30, 2012 I woke to a hectic day with a lot to accomplish in a rather short period of time. I had a late morning flight to catch. We decided to attempt to look at houses on the way to the airport. We calculated we could get at least one viewing in before I had to make my flight. Our tight schedule seemed to open up when all appointments were made for later evenings. We got even more wiggle room when I received a phone call informing me that my flights were delayed due to weather outside of Dallas. Now we had some time to play with.

With now 155 minutes of surplus time in the budget, my lovely lady and I spent 45 minutes of quality time at her place then set out to have breakfast on the way to the airport. We thought we had enough time before I had to be at my gate and she had to be at work. My poor fiancee ended up with an even worse morning when she caught a nail in her tire after dropping me at the airport, making her end up late for work by 45 minutes. I made my delayed flight just barely, arriving at the gate 3 minutes prior to boarding.

For breakfast, I prefer IHoP to Denny's, especially if we're on a tight schedule. In my experience, the worst service I've had at an IHoP has been better than the best service I've had at any Denny's. That is until yesterday. Instead of going to the IHoP closest to her apartment, we chose one closer to the airport. You would assume that IHoP #1466 would be used to airport traffic and customers on a tight schedule. So, when we said we had a flight to catch, we expected to be expedited. We expected to be seated, at least, in the order we checked in. However, one couple that came in after us was seated prior to us.

There was no hostess or host. The manager was handling both the cashier station and the host station. You would think that, if busy, he'd accept help at one of those. No, he chased away the one motivated waiter who offered to help. The restaurant has three dining areas. Two of them were closed during this "rush" period. That alone was a very poor business call demonstrating this guy's ineptitude. He had a line of people wanting to pay and leave. I also saw no less than three empty tables in the one dining area that was open at any given time. Yet, nobody was being seated promptly. To top it off, this manager was more interested in gabbing on his personal smart-phone on personal calls than doing his job. He was not only failing to manage his staff, he was failing to do the other two functions he took upon himself. He was doing nothing efficiently or effectively.

That same manager lied to us. He informed us it would be 7-10 minutes to be seated. It took 40 minutes. After being seated, our orders were taken within 3 minutes. We knew what we wanted before we sat down. 30 minutes after we were seated and ordered, we were informed our orders had still not been sent to the kitchen due to some computer glitch. That manager should have been on top of situations such as these. Instead, he was taking personal phone calls, failing to seat people in a timely manner, and paying cursory attention to people attempting to pay their bills.

That same motivated young waiter had his tables taken care of. He was jumping in and trying to help out the rest of the staff, who were moving slow and making excuses. He jumped in and took our order straight to the kitchen and got it expedited. We weren't in his station. He would not get credited with any tip we left. He also still slipped in and sat people, still getting dirty looks and negative comments from the manager while doing so. He just wanted to do his job. This kid should be in charge of the place. I did slap a $5 in his hand and told him to keep his mouth shut so he wouldn't have to give the tip he earned to those who didn't earn it, such as our assigned waitress or that incompetent manager.

To see the place is failing due to poor management is easy for anybody with some small amount of business sense or leadership ability. Any private in the US Army would recognize it and do better. The staff, minus that one young man, was unmotivated. They did not care if orders were wrong or late. They didn't check on the patrons or take notice if a food order that should have taken no more than 10 minutes was still not ready 30 minutes later. They seemed more relieved that seats were empty despite a full waiting room. That doesn't make sense if you are counting on tips as part of your income. The poor allocation of resources with two empty dinning areas was also a glaring indicator.

The servers seemed to have only 3 tables each. Still, their attentiveness was severely lacking. One would think that three tables at a time would increase wait staff performance. However, they were lazy and not interested in doing their jobs. If each expanded to five or six tables and kept them full, the shift would have seen a nice morning for all involved. If the manager had been on his game and made sure the staff was working, this would have been the case.

Making the lack of leadership and management ability present during the shift worse was when one employee informed me that many quit recently. Those that quit were among the better staff, leaving the lazier, less motivated employees running the shop. There was a huge "Employment Opportunities -- Inquire Within" sign outside. If I were seeking employment and saw the way this place was managed/operating, I'd avoid applying there as well. A strict manager that helps me make money is better than one who counts on the one good employee on a shift to do more than he is being paid to do. The manager there even did the "union organizer" labor management task of telling that one good employee to not do the work that needed to be done. 

We had to almost inhale our food (less than 5 minutes after it arrived) in order to have hopes of making our timeline. I made my flight, as stated, by 3 minutes. If it had not been for her flat tire, my fiancee would have been to work a little early, which she had hoped to do. Her favored dealership did take care of the car in a very quick manner, confirming her loyalty to good service. IHoP #1466 needs to take a few lessons from that Toyota dealership.

A note to my readers -- avoid IHoP #1466 in San Antonio, TX at near the US 281 and Anderson Loop (1604) interchange. The service is lousy. Until they change management and get the employees motivated or replaced, it has the lowest rating of any restaurant I have been to in the past 20 years. That includes the Denny's in Sierra Vista, AZ, which is proud of their low service rating.

How does this relate to socialist systems and bureaucracy?

Take a strong look. First you have a "manager" on a salary who will be paid regardless of how many customers get served. His job is to regulate production. He took on roles to further control that production by slowing that production and artificially creating an increased demand by not seating people in a timely manner. Now imagine that very same method applied to the healthcare industry such as the PPACA wishes to do.

Next, he restricted the capital employed from available resources, creating an artificial decrease in supply. This is the same thing the EPA is doing with domestic petroleum drilling and coal mining. The resources are there. However, the "manager" won't let them be used. It then appears there is a shortage of supply. Again, this is also a problem with "Obamacare". Yes, there are finite resources in the healthcare industry. However, they seek to restrict those resources even further, telling people to "make due" with less than they could actually afford.

The human capital decreased due to poor management. Why work if you aren't going to be allowed to make any money due to no tables being filled? Those who were willing to make those tips found the management to be counterproductive. Those who just wanted to do the minimum and collect the bare base hourly wage remained behind. These people are symbolic of those on government subsidies. Why do more when they get money for doing less (or nothing)? That's what happens when the government takes over private industries and lets unions run things, then dishes out subsidies to the unproductive. Only the bureaucrats and union organizers make the big bucks. It is counterproductive for actual workers to work. This adds to the artificial supply shortage by creating an actual shortage. The private citizens, the capitalists, cannot produce enough to make it worthwhile to operate.

To better explain this to those who failed economics, let's use the example of kite production. Let's say you make kites for local kids to fly. You open a business to make kites. Due to discounts on raw materials, the capital cost is $8 per kite. You can make 10 per hour and sell them at $10 each. that is $2 profit each, or $20 per hour that you spend making kites. Now, let's say you hire somebody to help you and pay them $0.75 per kite sold. They make 10 and hour, you make 10 an hour. You are now taking in $40 an hour and the employee is making $15 an hour (you are making $25). Now some union goon gets his government buddies to reduce your production to 8 per hour per person, and increases the minimum wage to $0.80 per kite sold. Supply is reduced to 16 per hour. The employee now makes $12.50 an hour, minus $2.50 an hour in union dues (netting $10.00 and hour before payroll taxes). You make $32 an hour gross, now netting $19.50. Both you and the employees are now earning less. Now add a $2 per kite "air usage tax" to the price, making the capital cost now $10 each. You are now operating at a loss. You try to raise the price by that $2 increase and the bureaucrats tell you that you cannot charge more than $11 per kite. You are now making $16 an hour, gross, $3.50 an hour net. It is cheaper, now, to get rid of the employee or just shut down the business. Of course, this is before the government instills an artificial shortage in the rattan you use for the kites, causing the costs to increase. Now you are paying money to have a business instead of making money. Would you still make those kites? Now what if the government bureaucrats mandated that you had to keep the business open?

Limiting what each worker is allowed to produce adds another artificial supply shortage. What happens when one capitalist tries to produce and improve the "system"? He is chastised for trying to do the right thing. He's interfering in the system that keeps the oligarchs content and the other workers "in their place" (with restricted productivity and wages down at just the mandated "handout" for "being on the clock").

Just apply all of this to Obamacare. Pay is going to be restricted. So why would health care professionals do more? What's the motivation? Those who are better and worth more will just quit and do something else. This will bring a shortage of healthcare workers. The taxes, regulatory fees, etc. will make it not worth the effort to provide care. They will collect their restricted paychecks for doing the bare minimums. Who will benefit? The government bureaucrats hired to regulate and monitor the "system" and the union thugs extorting dues from those who remain in the system. Who will suffer? Everybody who needs a doctor for anything from a physical exam to removal of a tumor before it becomes inoperable.

In the meantime, DineEquity, Inc. needs to fire the current management team at IHoP location #1466 in San Antonio, TX and promote that one young lad to a position closer to what he deserves.