Open up your mind and say, ahh...

The Microsoft Surface Pro, the new flagship Windows 8 device that launched on Saturday, is reportedly sold out in many retail locations across the country.

Great success, right? Not so fast. Apparently, as reported by ZDnet, that fact might be misleading. In general, of course, selling out on the day of a product launch is good thing. But not if it only sold out because there weren’t enough Surface Pros available.

And that seems to be the problem here. Apparently, stores around the country only received a handful of Surface Pros, so they quickly sold out, leaving lots of angry customers with empty hands.

Microsoft seems to call it a win, though. “Customer response to the launch of Surface Pro has been amazing. We’re working with our retail partners who are currently out of stock of the 128GB Surface Pro to replenish supplies as quickly as possible,” Microsoft wrote on its official Surface Pro blog.

Critics have been quick to point out that this “amazing” response is not backed up by actual numbers, but just reports of stores selling out of Surface Pro models. But the real question is, how many did they actually have available in the first place?

To learn more about the controversy, watch the video above.

Image courtesy of Microsoft

Shortly after his arrival in early 2002, Nick Wilkinson, as managing director of Dixons Retail, one of the largest consumer electronics retailers in Europe, actively tried to combine an already high level of internal competition by adding a team reward. As a consequence, many of his best salespeople left, discouraged by what they felt was a system intent on watering down their individual contributions.

However, to cater to the spirit of competition that is part of the young recruits eager to progress up the career ladder, he designed a plan in which stores were encouraged to compete against other Dixons stores of a similar size but in a different region. He also encouraged recruits to be transparent about their career ambitions via an internal, online application system. Everyone had access to whatever anyone else was planning as a career. Internal competition wasn’t so much eradicated as reoriented: some of it toward other stores, and some of it channeled toward career development rather than competition for the next customer.

As Wilkson’s story shows, getting the balance between competition and collaboration right is one of the most difficult team-leadership challenges.

Greed and Altruism

The tension between greediness and altruism among team members is subtle.

Intuition tells us that selves individuals should be popular; after all, they give a lot to the team yet ask little in return. It is equally obvious that selfish behavior is undesirable: if people were into it solely for themselves, they might free ride if given the chance, leaving some tasks either undone or poorly done. Here, the selfless might pick up the pieces and compensate for others. However, a surprising finding from recent experiments proves intuition wrong. Who would have thought that team members value charitable individuals much less than we (or even they) might expect.

Psychologists Craig Parks and Asako Stone came to this entirely unexpected finding after an experiment designed to study the expected ostracism of cheaters. Early results showed that team members were as likely to select the generous minded for exclusion. Using a computer simulation of a simple game, participants were given ten points per round to keep or place in a “public goods” kitty. Whatever points they put in the shared pool would double, after which participants could withdraw up to 25 percent of the pool (irrespective of their original investment). There was an incentive to withdraw less than 25 percent, namely, a bonus would be paid if the pool exceeded a certain threshold after an unspecified number of rounds. After the game, the psychologists asked the participants which of four players (one of whom was either a Scrooge or a martyr) they would like to play in another round. Unsurprisingly, the selfish person proved unpopular, but so did the selfless. So bewildering was the result that they reran the experiment four times while simultaneously testing alternative explanations.

So why is it that people are as likely to exclude selfless people as those who are greedy? Might it be that people are inherently bad at correctly estimating the contributions of those around them? So, if you take a smaller share, it reflects on you as having given less in the first place. Or, similarly, if you take less than others, this indicates the value you place on your own contribution, meaning that if you don’t value yourself, why should team members? The researchers’ first explanation–that the selfless person was perceived as incompetent or unpredictable, or the kind of person psychologists know will be disliked in this sort of game–proved to be false. When questioned, participants reported that seeing others take less than their fair share made them feel bad, and that the only way to rescue their own reputations (and make themselves feel better by comparison) was to eliminate the martyr. Virtue had become vice.

The Downside of Trust

Trust and vigilance coexist in varying degrees, as trust comes in different guises. For instance, it could signify confidence in team members’ technical competence, in their reliability, or in their benevolence. In much research on trust, the concept remains relatively poorly defined and referring to some combination of these three varieties, making it difficult to pin down. Nevertheless, some researchers exploring the topic of trust in teams have offered interesting suggestions. Penn State professor Kimberly Merriman, for example, thinks that low-trust teams are best rewarded according to individual effort. The fact that an estimated 85 percent of Fortune 1,000 companies use some form of team or group-based pay would thus suggest that they either think their teams have transcended the low-trust barrier or hope that pay might promote trust. If the latter is true, it seems ironic that cooperation is far better fostered by shared perceptions of fairness, of which the allocation of specific roles and individualized rewards are key features.

More trust isn’t necessarily better. One can have too much of a good thing. A recent experiment with teams of executive MBA students given two hundred colored-plastic bricks (from which they were asked to craft nothing more sophisticated than a coat stand) finds that trust can be the death knell to creativity. While trust is associated with creativity–not least because it signifies a psychologically safe space in which people can tinker freely without fear of losing face–this really only applies up to a point. Beyond this, trust becomes a liability. Team members placed a higher premium on harmony than on solving the problem at hand. The creative tension that results from questioning each other’s suggestions gives way to trying to please one another.

Tensions Ignite Outstanding Individual Performance

These seemingly contradictory forces coexist, in a perfectly natural way. Competition weeds out inefficiency in an otherwise collaborative environment. Trust can lower transaction costs but also lead to free riding if not paired with some degree of vigilance. Control can prevent waste, particularly when dealing with less experienced team members, yet autonomy is what allows them to make mistakes and learn from them, or to handle difficulties with clients they know well rather than those more senior but also more detached. Charisma can become manipulative if those who are more analytical do not rein it in. Analysis without charisma can fuel cynicism. Patience is a virtue but, if too widely shared, could cause a team to be indecisive; hence it helps to have someone on board who is more decisive, even if being too decisive can lead to hasty choices. Granting colleagues autonomy provides scope for personal growth and flexibility, yet too much autonomy enables them to build their own empires.

This means that control is required, although too much control can be seen as autocratic, off-putting, and ineffective. Open-mindedness allows for flexibility and creativity, but too much of it can render teams indiscriminate. Loyalty to key ideas, to ground rules, or to those in charge might balance that out, but loyalty that is too strong can cause teams to miss opportunities.

These tensions can quite easily make a team of high performers seem fragile, even if it is perfectly functional. The tensions can make even the most effective teams feel off-balance occasionally, as teammates work to reconcile, or reconcile themselves, to the contrary pulls. The potential for conflict is never far away, not just because those team members often fall prey to their own insecurities, but because they believe things should be done in particular ways.

The point is clear: what feels dysfunctional need not be. Tension may be unpleasant–but not illegitimate.

Image: Flickr user Kai C. Schwarzer

Last month, I talked to Amazon customer service about my malfunctioning Kindle, and it was great. Thirty seconds after putting in a service request on Amazon’s website, my phone rang, and the woman on the other end–let’s call her Barbara–greeted me by name and said, “I understand that you have a problem with your Kindle.” We resolved my problem in under two minutes, we got to skip the part where I carefully spell out my last name and address, and she didn’t try to upsell me on anything. After nearly a decade of ordering stuff from Amazon, I never loved the company as much as I did at that moment.

I never loved the company as much as I did at that moment.

Remember, this was a customer-service call, so I was fully prepared for it to suck. Like most American consumers, my experience with service interactions is largely negative, whether it’s on the phone, in the murky depths of a commerce site, or in the aisles of an electronics store. I’m accustomed to the company being in control, and for our communication to be cold, scripted, and inhumane. Barbara’s congenial but no-nonsense approach was part of what made this experience different, but more important, she had access to exactly the right data about me, and that made the favorable exchange possible. The fact is, Amazon has been collecting my information for years–not just addresses and payment information but the identity of everything I’ve ever bought or even looked at. And while dozens of other companies do that, too, Amazon’s doing something remarkable with theirs. They’re using that data to build our relationship.

The Most Useful Data Set in the World

Big Data has gotten a lot of attention over the past 18 months as retail, manufacturing, and technology companies realize the gold mines they’re sitting on and rush to scour them for competitive advantage. Nearly all of this discussion, though, revolves around consumer trends, marketing guidance, new product planning, and other market-level insights. When McKinsey wrote its omnibus report on Big Data last year, the consulting company identified five different ways it can be used to create value, but only one of those methods mentions customers at all, and then only in terms of improved segmentation. The Wall Street Journal outlines several business success stories in its Big Data blog series, but it focuses almost entirely on smarter market visualization, better process maps, and other efficiency enhancers. Efficiency is a worthwhile goal, but from a customer’s perspective, data has far more power at the personal level.

In order for interactions to feel individualized and human, they must be well informed.

Perhaps the only business and marketing topic that’s been talked about more than Big Data recently is the evolution of brand relationships into two-way conversations. Now that consumers have seen what social media and mass customization are capable of, they increasingly expect this kind of personalization in their communication with favored brands, not just a passive role absorbing marketing messages. Combine this insight with the rise of Big Data, and you have a clear mandate: In order for interactions to feel individualized and human, they must be well informed. That makes data about the customer you’re talking to right now the most useful data of all.

Technically, this is hard to do. Amazon has grown large while staying fairly consistent as an organization, but most big companies got big through acquisition, and that makes synchronizing data a massive chore. Getting targeted information in front of the person who’s dealing with an individual customer, or designing for one, is still a low priority. Customer service in its various forms is still treated as an expense to be minimized, not an opportunity to be developed.

Service designers know that the opposite is true. When a customer calls the support number, sends an email, or talks to a store employee, he is initiating a conversation. You have his undivided attention, even if he’s annoyed, and that makes it a crucial brand-defining moment. He’s hoping for a conversation, but bracing for an ordeal. He knows you’ve collected information on him for your own purposes and wondering why you don’t do something useful with it. Not useful to you–useful to him.

Synchronized data is worth the expense because it’s a hallmark of human interactions. If I talk to a friend and they keep asking me for information I know they already have, I have a right to get irritated. In the age of Big Data, I hold brands to the same standards. The few that meet those standards earn my trust and loyalty. But if you’re hoping to use personal data successfully, there are a few things you have to get right.

I have no idea what Barbara was looking at on her screen when she called me up, but it gave her the information she needed about me in a matter of seconds. Someone designed the tool that delivered it and made sure she had access to it. Despite your internal divisions, I as a customer have only one relationship with your brand, and it has to be seamless. That’s what makes information tools so vital. They transfer data that’s been collected automatically or through form-filling into the personal realm, allowing us to get the awkward, impersonal, corporate conversation out of the way, and make way for the human one. The rise of portable platforms makes this possible for designers and store employees, too, not just the headset-wearing call-center folks.

When I meet an old acquaintance at a party, she remembers my name and asks one or two questions about things we discussed last time we spoke. The fact that she remembers establishes rapport; the fact that she doesn’t list out every bit of information she possesses makes me feel comfortable. Without even thinking about it, humans are very good at conveying just the right amount of information in personal conversation.

She only referenced the data that was necessary. It quickly disarmed my self-defense instinct.

Companies need to do the same. When I spoke with Barbara at Amazon, she had access to plenty of data, but only referenced what was necessary, starting with my name and the problem I was trying to solve. It quickly disarmed my self-defense instinct and made me comfortable referencing facts we knew in common but hadn’t explicitly stated. “Can you send it to the Northeast Ninth Avenue address?” I asked when we got to shipping options, even though I hadn’t asked if she had it on file. “Sure,” she said, and I smiled.

Many of us have read the story of Target’s uncanny ability to recognize a customer’s pregnancy based on her purchasing habits. At first frightening, this revelation sounds reasonable on further review, but no less creepy. Target quickly learned to get nuanced about using this insight. To avoid upsetting these customers (and their parents), they now send them flyers customized to include just a few coupons for prenatal necessities, mixed in with a random assortment of others.

That’s a partial solution at best. In the future, smart retailers will be more transparent about their data-gathering efforts and use the results more appropriately. They’ll give customers more options for controlling how much they share and how that information gets applied. Regardless of who gathered it, customers still see it as their data. They expect to be treated like the owners.

The power of being known

There’s a quiet race going on right now among brands to form customer relationships that earn loyalty in the face of increasing competition, and personal data is the surest way there. Brands like Zappos, Netflix, and Amazon are already showing the power of such an approach. Not only does smart data use empower you to treat customers as individuals, it does so without invoking many of the fixed expenses associated with improved service. Good data support doesn’t require a vastly expanded workforce, or even a new type of employee–these are conversations that people already know how to have.

In the future, customers will expect these sorts of interactions.

But imagine the benefits if you get it right. An auto mechanic who’s smart about data could tell you that your fan belt is due for a change in 2,500 miles and suggest doing it today to save future labor costs. An airline that knows more than just your frequent flier number could propose a seat based on your past selections, offer discounted upgrades tailored to your preferences, and let flight attendants know you prefer tomato juice to orange juice in the morning–even if you’re just flying coach. If they’re really paying attention, they could even learn whether or not to offer you an upsell, and in which categories to do it.

As long as they’re given transparency and control, consumers are becoming quite comfortable with these kinds of interactions. In the future, they’ll expect them. When that happens, the question won’t be “How much do you know about me?” but “What are you going to do with what you’ve found?”

Images: almagami and Everett Collection via Shutterstock

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