Shanghai Street View: Saluting Service
A new pilot program for Shanghai’s taxis was small news in the headlines this week, even though the move itself is quite revolutionary. That’s my humble view after reading about the program being rolled out by Qiangsheng, our city’s largest fleet operator, which is taking the ground-breaking step of actually tying taxi drivers’ pay to their service rather than just how many miles they drive each month.
The program probably won’t have much impact on local traffic congestion, but could go miles towards restoring the rapidly-fading image of our city’s thousands of taxi drivers. I remember a time not so long ago when Shanghai was quite proud of its taxi fleet, which consisted of relatively courteous drivers who were immediately identifiable by their trademark white gloves and willingness to take you almost anywhere you wanted to go without complaint.
Fast forward to the present, where it’s rare to see any drivers wearing the white gloves anymore, and refusals to take passengers on trips to nearby or out-of-the-way destinations are increasingly common. On the rare instances when drivers do wear their gloves anymore they’re often dirty and look like they haven’t been washed in weeks, which perhaps is a good metaphor for the increasingly dour attitude among many of our city’s taxi drivers.
Against that backdrop, I was excited to read about Qiangsheng’s new plan, which is remarkably innovative for this kind of big state-run company that previously expended minimal effort to ensure customer satisfaction. Of course everyone knows that the situation has changed radically over the last 2 years with the arrival of Uber, Didi Kuaidi and other private car service providers to Shanghai, causing a minor panic among Qiangsheng and other major taxi operators that suddenly lost their monopoly on the market.
I’m not a frequent taxi user, and have to admit I haven’t tried Uber or any of other new private services here in Shanghai. But my friends who have all praise the services not only for their efficiency, but also the clean cars and polite drivers.
Service-Based Compensation
That challenge is the main driver behind Qiangsheng’s new program, which is offering more service-based compensation to a small number of its participating drivers. The package will eliminate the usual practice requiring drivers to pay a monthly rental fee, and instead give them a basic salary and additional income tied to their performance. Factors that will be considered will include more service-oriented elements like drivers’ safety records and the number of complaints they receive.
This new program looks quite innovative for big companies like Qiangsheng, which are famous for their slow movement to address competitive threats. It also marks a sharp detour from the usual “more is better” mentality that plagues many sectors in China, where companies frequently pressure employees to bring in as much business as possible without much concern for service. The equation works as long as everyone follows that principle, but rapidly breaks down when a big foreign company like Uber enters the market and provides a competitive product with far better service.
Taking taxis in Shanghai used to be a relatively neutral experience, but has become increasingly negative in the last 2 years as drivers lose business to Uber, Didi Kuaidi and others. But while drivers are losing money, it seems the big operators like Qiangsheng weren’t feeling the same pinch because they relied mostly on monthly rental fees for their money. I expect that growing driver complaints, and perhaps even the resignation of some unhappy drivers, is probably finally leading Qiangsheng and others to take this kind of ground-breaking action.
This pilot program may need some tweaking to make it really successful. After all, it’s difficult to report a taxi driver who refuses to take you somewhere, and most people usually can’t be bothered to write down the name and license number of a rude driver and then take the time to make a formal complaint. Perhaps Qiangsheng and others could install a system like the one now used at customs counters at our airports, where passengers are automatically asked to rate the service of the agent on each trip and responses remain anonymous.
At the end of the day, what’s really important is that Qiangsheng is finally trying to take some substantive action to halt its declining business, rather than just complain to the city government to outlaw services like Uber and Didi. In that regard, my kudos also go out to our government and Beijing, which are cautiously welcoming these new services by licensing rather than banning them. In the end, everyone realizes these new private operators will help improve the broader sector with not only new technology, but also by forcing all drivers to be more courteous and safe, and perhaps to even clean up their cars every once in a while.
