Issue link: http://digital.corporatepress.com/i/143540
coin toss Appreciating the Effort: The Psychology of Providing Services By Joe Whitefield S uppose you have locked yourself out of your house and must call a locksmith to open the door. Before the locksmith arrives, answer the following question about the impending service; would you rather the service be (a) faster and cheaper, or (b) slower and more expensive? Obviously, we would all prefer option (a), right? In practice, many people actually prefer option (b). After learning of this behavior from an actual locksmith, behavioral economist Dan Ariely began looking into these irrational economic decisions for an explanation. Several experiments later he uncovered some interesting views about money that explain this behavior in a way that should interest anyone in service industries—including facility managers. Consider the following: Perceptions Early in his career, a locksmith confesses to be less competent. When working on a lock, he might take 45 minutes to an hour to open the door. This would often involve breaking the lock and replacing it with a new lock. After completing the work, the customer is presented with a bill that includes a door C Completion O Organization IInnovation N Being Nice opening fee and charges for the new lock. Happy to have the door opened, customers would often pay the bill and give him a tip. Later in his career, the locksmith is more competent and experienced, and can often open the door in 10 minutes without breaking he original lock. This bill only has a door opening fee. Under this scenario, the customers would frequently complain about the "excessive" charges and would rarely give him a tip. So, in essence, the customers feel better about paying more, in both time and money, when they see the locksmith making a bigger effort. Effort is rewarded and effectiveness is not. In this case customers are paying for incompetence. Put another way, customers often do not know how to value expertise, and that taints their view of the quality and value of the services they receive. The costs associated with obtaining the expertise (education, training, tools, equipment) are mostly upfront or fixed costs. The costs associated with performing the individual task (mainly direct labor or supplies) are the marginal costs. With little knowledge of or appreciation for the upfront costs, customers conclude the marginal costs are the drivers and that services should be charged in accordance with the visible effort. As a consumer, your mind may be taking off remembering encounters when you have irrationally valued effort over true expertise, and questioned or even complained about a service you received. I know someone who has had the exact encounter with a locksmith while on vacation. As a facility manager, you may be thinking of a time when people have complained about a service you provided. If so, let's look at this problem a little deeper to see if there are some helps for us. Invisible Expertise and Effectiveness Facilities departments provide essential services to their campuses. We are conscientious, efficiency-minded, customer oriented, and typically quite competent in providing these services. As such, we often strive to be part of the hidden organization. We perform a significant amount Facilities Manager | july/august 2013 | 21