Idea in Brief
The Dilemma
Conventional wisdom holds that the more contact an operation has with its customers, the less efficiently it will run. But when customers are partitioned away from the operation, they are less likely to fully understand and appreciate the work going on behind the scenes, thereby placing a lower value on the product or service being offered.
The Solution
Managers should experiment with operational transparency—the deliberate design of windows into and out of the organization’s operations to help customers understand and appreciate the value being added.
The Benefits
Witnessing the hidden work performed on their behalf makes customers more satisfied, more willing to pay, and more loyal. It can also make employees more satisfied by demonstrating to them that they are serving their customers well. However, managers should be aware of certain conditions in which transparency can backfire.
Barclays Bank installed the world’s first successful automated teller machine to much fanfare in June 1967. Having a machine distribute cash was less expensive and more efficient than having a human teller do it. What’s more, customers could access the ATM at any hour—even when the bank was closed. It seemed like a win-win, and ATMs quickly spread around the world. Today people are three times more likely to withdraw money from an ATM than from a human teller.