Solving the Human Factor Puzzle to Increase Profits

Solving the Human Factor Puzzle to Increase Profits

Have you ever witnessed someone having difficulty determining the answer to a puzzle? There are a number of different types of puzzles that people use to challenge and entertain themselves—jigsaw puzzles, crossword, and Sudoku puzzles, to name a few. People approach puzzles differently. With jigsaw puzzles, some people begin by sorting the pieces into two piles—pieces that go on the perimeter and those that go on the inside. Once this task is accomplished the person may try to get all of the perimeter pieces in place before filling in the rest of the puzzle. Other people may begin by trying to locate and connect pieces for a focal object in the picture. Individuals also take different approaches to solving crossword puzzles. Do you begin with the items going down or across? Do you take each hint in order, refusing to move on to the next until you’ve solved it, or do you skip over the challenging ones and go back to them at the end? There is no right or wrong way to proceed as long as you ultimately reach your objective—solving the puzzle.

Human behavior can also be a puzzle of sorts and a very fascinating one at that. Everyone plays amateur psychologist from time-to-time, trying to figure out why people behave the way they do, especially when they behave in ways that we do not expect. Social scientists spend their entire careers trying to better understand behavior. Like other types of puzzles, it can be challenging to try to solve the puzzle of human behavior and also very rewarding. In business, human beings (both customers and employees) are crucial to our success and solving the human factor puzzle can have a positive impact on our bottom line—profits.

Q: But how do you go about solving the human factor puzzle to increase profits?

A: The answer is simple—scientific surveys.

The word scientific is key here. Not all surveys are scientific. As a scientist and as a consumer, I have come across hundreds of customer surveys. When reading these surveys it is obvious to me that some were constructed by individuals with no advanced training in research methodology. It is a myth that common sense and knowledge of a company’s product or service are all that are needed to construct a useful survey. A survey is only useful if it enables you to obtain accurate information about perceptions and behavior. Poorly constructed surveys do not meet this objective. Here are some common characteristics of poorly constructed surveys:

1. Too brief: A survey must have sufficient breadth and depth in order to learn enough about attitudes and behavior and identify key drivers.

2. Too long: Some surveys go on and on and on…..When surveys become too long, respondents lose interest. They will begin marking any response without fully reading the question so they can be finished with the task.

3. Imprecise questions: If a survey item is poorly worded, its meaning may be unclear to the respondent who will either leave it blank, or guess at the meaning and respond accordingly. Both options lower the completeness and accuracy of your data.

4. Two questions in one item: Some survey items contain two questions such as: “Was your order correct and on time?” What if the order was correct but late? Or incorrect but on time? How does the respondent answer the item in such circumstances?

These are just a few of the common problems with some survey instruments. Individuals with advanced training in research methodology (preferably at the doctoral level) know how to construct survey items that are precise and capable of accurately measuring attitudes, perceptions, and behaviors. With a well-designed instrument, a qualified statistician (once again, doctoral-level training is best) can apply descriptive techniques as well as inferential techniques to help us better understand our employees and customers and identify key drivers of their behavior.

One thing we all know is that customers want quality when purchasing a service. But what exactly does that mean? Human beings are individuals with differing opinions of the same service. This is apparent when you read reviews of businesses posted online. Recently I was searching the Internet for a hotel to stay at for a weekend getaway. There were at least five hotels within a few blocks of each other that had the characteristics I was looking for. In order to help me choose one I decided to read the reviews posted by previous customers. I quickly surmised that this approach only added to my confusion. For any given hotel, some people loved it and thought the staff were friendly and helpful while others hated the hotel and perceived the staff as rude and unhelpful.

The online reviews made it clear to me that people have different perceptions of what constitutes quality service. In order to learn more about perceptions of service quality, one group of researchers used various scientific methods and statistical techniques to identify important dimensions of service in a large, U.S. bank. In an article titled “The Service-Quality Puzzle,” Leonard Berry, A. Parasuraman, and Valarie Zeithaml describe the methods and results of this study. The first phase involved using 12 focus-group interviews to learn about customers’ views in addition to in-depth, face-to-face interviews to learn from the experiences of marketing, operations, and customer-relations executives. Their research revealed that customers evaluate the quality of service by mentally comparing their perceptions of delivered services with their expectations of the service. These comparisons are done along ten distinct dimensions including:

· reliability,

· responsiveness,

· competence,

· access,

· courtesy,

· communication,

· credibility,

· security,

· understanding/knowing the customer, and

· tangibles.

The researchers used the results of the qualitative techniques from the first phase of the study to design a customer survey instrument for the next phase. In the second phase, the customer survey was used to identify the service characteristics most influential in customer perceptions. The service dimensions that emerged as most important to customers in all areas of service were: responsiveness, assurance, empathy, and reliability. Of these four, reliability was clearly the most important to the bank customers. In their research, Berry and his colleagues also addressed the question of what goes wrong in customer service to lead customers to perceive a lack of quality. They identified several causes of service-quality problems, one of which is a discrepancy between customers’ expectations and management’s understanding of customer expectations. This is a problem that can easily be avoided by regularly utilizing customer surveys to identify customer expectations and drivers of their behavior. A second problem identified by Barry’s team were instances in which management fully understands customer expectations but perceives these expectations as impossible or impractical to meet. For example, they interviewed executives at a repair and maintenance firm who stated it was difficult for them to meet customer demand for prompt service during summer months because lawn mowers, air conditioners, and bicycles were in heavy use during this time. Asked why it would be difficult to meet demand, one executive responded that summer was the time of year when their technicians liked to take their vacations. This firm allowed service to suffer because it prioritized the expectations of its work force over those of its customers. Another service-quality problem had to do with a lack of willingness on the part of employees to perform a service at the required level.

From Berry’s research we can see that knowledge of both customer and employee attitudes and perceptions are crucial to being able to meet customer expectations. Knowledge of customers and employees is also critical for increasing profits. In an article titled “Assessing the Service-Profit Chain” published in Marketing Science , Wagner Kamakura, Vikas Mittal, Fernando de Rosa, and José Mazzon use a technique called structural equation modeling to show how knowledge and proper management of both customer and employee attitudes is vital when implementing strategies to increase profits. Their study included data collected from over 5,000 customers of 500 branches of a bank. The analyses revealed that the attitudes and behavior of personnel influence the perceptions of customers which, in turn, influence the customers’ intent to recommend. The customers’ intent also influences the customers’ behavior which directly influences profits.

Surveys can be used to obtain very powerful information that can lead to increased profits. One business research firm, the National Business Research Institute (NBRI), is not only a leader in both customer and employee surveys, but they also have the capability of analyzing data from both of these surveys together to reveal which employee attitudes and perceptions are influencing customer attitudes and perceptions; thus enabling a company to complete the human factors puzzle and increase profits. Don’t struggle with trying to solve the human factors puzzle of your business alone. Call NBRI today at 800-756-6168 to learn how we can assist you with your survey processes and provide all the tools needed to solve your human factors puzzle.

Dr. Cynthia K. S. Reed, Ph.D.
Organizational Psychologist
The National Business Research Institute

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