Elevate Employees, Don’t Eliminate Them

A traumatic discontinuity like the Covid-19 pandemic presents an opportunity to reconnect on fresh terms—with families, friends, coworkers, and even ourselves. For businesses this moment provides a chance to reimagine the role employees play in customer service. Even before the pandemic, technology was increasingly making it possible for employers to automate interactions with customers; thus many managers will instinctively look for ways to eliminate jobs. Indeed, the last major global shock—the 2008 recession—led to what economists call a “jobless recovery,” as companies found that they could get by with fewer employees. Taking that approach now would be a mistake. To be sure, some efficiencies will lead to the elimination of certain roles. But most managers should focus on elevating employees, not eliminating them—on changing their jobs to unlock more value by allowing them to have deeper and more-meaningful connections with customers in the moments that count. In an article titled “Operational Transparency” (HBR, March–April 2019), I explained how showing the work that employees do for customers can lead to higher customer satisfaction, loyalty, and willingness to pay. The fundamental driver of this effect is the power of connection. When customers see how employees are working to solve their problems, they place greater value on that work. From this insight and related research, I have developed a post-pandemic playbook for employers centered on five key pieces of advice: Create the conditions for employees to connect with customers when it matters most. Help employees make more of these meaningful connections by shifting the boundaries of their work. Find ways for customers to lend a hand, which they will gladly do if employees have created a meaningful connection with them. That will lead to further efficiencies. Ensure that employees can see the impact of their work on the lives of their customers, which will make their work more rewarding and engaging. Invest some of the value created by employees’ redesigned roles in increased compensation and improved scheduling—which can make their jobs more sustainable and realize further value. The most obvious application of this playbook is in sectors where interactions between customers and employees are routine. But recent experience reveals that the potential for employees to foster connections with customers is far greater than we might have imagined. For example, during the pandemic many people came to know the mail carriers and sanitation workers who served their homes, just as they had previously done with hairdressers, bartenders, baristas, and other service workers. Indeed, in sectors where interactions have historically been the most transactional, the gains for organizations that enable their employees to connect when it counts stand to be especially dramatic. Connecting When It Counts When people perceive that a lot is riding on an interaction—that their physical, emotional, social, psychological, or economic well-being may be at risk in some way—it is a moment of truth for the organization, because the experiences customers have will define or redefine how they perceive it and engage with it going forward. Leaving customers to fend for themselves can make them less confident in their choices, less trusting of the company overall, and less likely to remain loyal. When employees are well positioned to respond to customers’ emergent needs, they can create breakthrough value by reframing the service their employer provides and differentiating the business from its competitors. This effect is so powerful that customers need not necessarily even engage with an employee for benefits to arise. Simply the knowledge that someone is readily available and willing to help can make a profound difference, increasing customer confidence, satisfaction, trust, and long-term loyalty. For example, in one field experiment I conducted with Michelle Shell of Boston University, customers who applied for a loan and proactively received a text from their loan officer with an invitation to phone if they had any questions were 16% more likely to move forward with the loan (if approved) than customers who received no such invitation—even if they never actually accepted it. Service is the business of people helping people, and people are born with the tools to help one another. Empathy enables us to understand how others are feeling and tailor our responses accordingly. Indeed, many organizations screen job candidates for empathy, attention to detail, and service-mindedness. Yet after people with these qualities are hired, the design of their jobs may prevent them from doing what they would otherwise do well naturally. They may lack the time, the resources, the motivation, or the discretion to make connections. Addressing those problems can unlock considerable value for customers, companies, and even employees themselves. Shifting the Boundaries of the Job How can leaders create the conditions for more-meaningful connections? Paradoxically, the best place to start is precisely at the point where technology or some other intervention could take over an activity. Instead of asking, Can I eliminate this employee?, ask, Can I tailor this job to eliminate routinized, dead-end encounters with customers and allow the employee to respond fluidly to their needs while developing a bond with them, however briefly? For example, Amazon Go opened its first full-scale supermarket in Seattle—after nearly 10 years of incubating and piloting the concept in smaller formats—just as the pandemic was taking hold. At the store visual-imaging technology tracks items as they’re taken from shelves, so customers can bag as they shop and walk out when they’re finished; their accounts are charged automatically. The most visibly laborious part of shopping excursions—checkout—has been automated away. Yet Amazon Go still relies quite heavily on employees. They’re just not behind a cash register. They’re out on the floor, available to assist shoppers and chip away at a perennial pain point in grocery stores: finding what the customer seeks. Clad in bright orange uniforms, employees restock shelves and tidy displays while explaining the store’s technology to shoppers and offering guidance about products. As people learn how to shop in Amazon Go stores, and as Amazon figures out how to automate restocking, the company may move to a lighter staffing model. But an alternative and differentiating path would be to elevate the employees, enabling those in particular departments to create even more value for customers by accumulating specialized product knowledge and taking on an increasingly consultative and relational role. Honing their expertise through customer interactions, domain specialists might, for example, be able to share advice about wine pairings or recommend popular and nutritious school-lunch items for fifth-graders. Perhaps Amazon could support these elevated employees by connecting them with its recommendation engine or arming them with the technology to help customers place Prime delivery orders of items not carried in the store—above-and-beyond experiences that would play to the company’s strengths. Simply the knowledge that an employee is readily available and willing to help can increase customer confidence, satisfaction, trust, and long-term loyalty. Giving employees time and space to double down on the tasks humans are best equipped to handle—connecting with other humans, using empathy to understand problems and ingenuity to solve them—could enable them to create considerably more value than they did in their original roles. If their jobs become more relational, employees will need training and systems to support their development, resources and discretion to facilitate graceful responses to unanticipated customer queries, and a means to channel ideas and feedback to leadership about how to enhance their roles and the company’s offerings even further. There are other ways to help employees connect in the moments that count. In some cases cross-training can create slack by enabling coworkers to cover one another on routine assignments when customers require attention. In other cases work can be shifted to supply chain partners, as when manufacturers apply price tags to products or distributors place inventory on the selling floor. To be sure, leading companies have long prioritized frontline encounters. But the constraints imposed by the pandemic have forced us to question conventional wisdom about how work is best accomplished. Sometimes, through a thoughtful redesign, tasks can be eliminated altogether. The company Getaway, which rents out tiny cabins in the woods, has done away with many fixtures of the traditional hospitality business: It has no front desk, no concierge, no turn-down service, no room service, and no housekeeping during the guests’ stay. The model is designed to let people feel that they’re walking into their own cabin in the woods. When they arrive, they use a key code to access a meticulously clean space. A “cabinkeeper” will have left a handwritten, personalized note, along with a “s’more kit” or some other amenity, to make guests feel welcome. Getaway aims to minimize customer-employee interactions so that guests can share meaningful moments with each other and unplug in nature. However, every cabin has a landline for reaching staffers immediately with questions or if help is needed. The company’s customer service model treats each guest like a dear friend staying in a private home. Team members use guests’ first names, make things happen quickly, and add a personal touch whenever possible. Stripping away unnecessary tasks allows Getaway employees to create an emotional connection with guests when doing so really matters. Letting Customers Lend a Hand My research has found that giving employees the ability to respond fluidly to customer needs can increase trust in an organization and deepen customers’ relationships with it. And when the effort employees are making to help is visible, customers appreciate and value their service more and often feel an urge to reciprocate. Indeed, they will take on some of the work themselves as long as three conditions are met: They know how they can help; they are able to help, and they believe that their helping is important. This insight does not give license to dump work on customers. Rather, it’s about recognizing the human capacity and desire to be helpful in contributing to shared goals. Moving away from the default assumption of zero engagement by the customer can have a dramatically positive effect. At Getaway, for example, the cards on which cabinkeepers write their personalized notes have a line at the bottom that says, “You’d make our day by doing your dishes or tidying up before you go.” The majority of Getaway’s guests clean up after themselves, making it easier for cabinkeepers to excel in their roles. Letting customers lend a hand isn’t just more efficient; often it enhances their experiences. We feel better about ourselves when we’re able to contribute. In another example, when the city of Boston began showing residents images of the work its employees were doing to respond to their service requests (such as cleaning graffiti and fixing potholes), Ethan Porter of George Washington University, Michael Norton of Harvard Business School, and I found that those residents became more engaged with the city, submitting 60% more service requests. With more residents reporting problems, the city could allocate fewer workers to finding them and more workers to solving them. Letting customers lend a hand isn’t just more efficient; often it enhances their experiences. We feel better about ourselves when we’re able to contribute, and our contributions can serve as low-cost ways to customize service outcomes. Involving Boston residents in submitting service requests, for example, gave them a voice in which problems the city addressed first. A stake in the outcome can also increase investment in it. Research conducted by Michael Norton with Daniel Mochon of Tulane University and Dan Ariely of Duke University has shown that when customers lend their own efforts to a service outcome, they value it significantly more. The researchers named this phenomenon the IKEA effect, after the popular furniture retailer that leaves assembly to the customer. For example, the company Zameer Kassam Fine Jewelry designs bespoke jewelry, two-thirds of which is engagement rings. The company employs a high-touch process through which employees learn the details of each couple’s love story in order to create a one-of-a-kind piece just for them. Of course, any bespoke product requires intensive customer interaction, but Kassam and his team ask for a higher level of client participation than is typical in a luxury service experience. After completing an introductory call, a tutorial about diamonds, and an in-depth interview to learn the details of the couple’s relationship, Kassam and his team of “storytellers” (client-facing representatives) have more than enough information to design the piece of jewelry. But they add a step—assigning the client “homework.” For example, the client might be asked to find and share a text exchange from a pivotal moment in the relationship or a photograph of a spoon that reminds the client’s intended of her or his childhood. The homework assignment is unique, chosen by the storyteller to help the designers better understand the central details of the couple’s story, and often clients delight in spending hours on it. Their contributions inform each ring’s design, but they also enhance the experience and investment in the ring itself, because the client played a role in its creation. Kassam believes that the homework assignment is critical to the company’s collaborative process and helps motivate more than 90% of clients to move forward with their projects. Demonstrating Employees’ Impact Elevating employees so that they can better connect with their customers gives them a clearer view of the impact their work is having. In our research my colleagues and I have found that this can make work feel more meaningful and appreciated, increasing satisfaction and engagement. However, enabling that view often requires deliberate action. For example, the final step in the Zameer Kassam Fine Jewelry process is the “private celebration.” After a ring has been purchased and the question has been popped, Kassam’s team invites the couple to come to the design studio together. The partner expects simply to meet the ring’s designer. Kassam explains, “What they don’t know is that we will surprise them with all the details of the process, including the notes of their love story that we’ve now rewritten in our special way. I can guarantee you, most people have never heard the words their partner who loves them will say when they are not there. When we share these special words—often reciting quotes—it’s the most beautiful, emotional moment. We are enabling love to the nth degree.” Kassam’s entire client-facing team attends these private celebrations. It’s a chance for employees to reconnect around the organization’s purpose and to experience firsthand the impact of the work they do. In addition to creating an extraordinary experience for clients, this peak event of every customer engagement provides joy and a sense of purpose for employees, filling them with even more enthusiasm and dedication for the next project. Making the Work Sustainable This playbook, centered on forging more-meaningful connections between customers and employees, can help organizations become more profitable through higher prices, better word of mouth, increased loyalty, further purchases and cross-selling, and sales growth. Some of that value should go toward making the roles of employees who are creating it sustainable. Increasing compensation and improving scheduling are two levers that leaders can pull. This is not about accepting inflated overhead; it’s about making an investment that will have a return. (The MIT professor Zeynep Ton has written in these pages about ways to improve the experience of frontline workers.) When employees are struggling financially, it can hinder their ability to focus on their work. Research conducted by Anandi Mani of the University of Oxford, Sendhil Mullainathan of the University of Chicago, Eldar Shafir of Princeton University, and Jiaying Zhao of the University of British Columbia found that being preoccupied with financial concerns can reduce a person’s cognitive capacity more than would going a full night without sleep. Work by Mullainathan, Supreet Kaur of Berkeley, Suanna Oh of the Paris School of Economics, and Frank Schilbach of MIT has found that when employees aren’t worried about their finances, they are more productive and make fewer on-the-job mistakes. Providing sufficient pay and hours can free them to focus on their work. Erratic schedules are another hidden drag on performance. At many companies schedules may fluctuate from week to week, changing on short notice and making it difficult for employees and their families to maintain healthy relationships and negotiate childcare, coursework, and other obligations outside the job. In a 35-week field experiment conducted in partnership with Gap in the United States, a team of researchers, including Saravanan Kesavan of the University of North Carolina, Susan Lambert of the University of Chicago, Joan Williams of the University of California, and Pradeep Pendem of the University of Oregon, found that sales increased 7% when employees were offered stable and predictable schedules. Analysis revealed that the effect was driven by better execution in the stores: Employees exerted more effort under the new schedules and had an easier time adhering to them. The initiative, which included 28 stores, cost $31,200 and brought in $2.9 million in incremental sales. Companies that reveal their sustainable employment practices to customers can reap additional rewards. In a recent field experiment, Basak Kalkanci of Georgia Tech and I partnered with Alta Gracia—an apparel manufacturer that pays a living wage to its workers in the Dominican Republic—and a U.S.-based retailer that sells Alta Gracia’s products. We used video kiosks on the sales floor to show customers various messages about the company. Customers shopping during videos about Alta Gracia’s living wage for its workers were 19% more likely to buy its products than customers shopping while a traditional marketing video was playing. Making the work sustainable can create more value for customers and employees while increasing the company’s attractiveness to both groups. . . . Humans are social animals. By driving us into isolation, the pandemic has reminded us of our hunger for meaningful human interaction. As this playbook makes clear, a single insight—that customers and employees should be able to engage like humans—holds tremendous value in the post-pandemic world.

Elevate Employees, Don’t Eliminate Them

Summary.

Partner Center