Creating Reciprocal Value Through Operational Transparency
Ryan W. Buell, Tami Kim, Chia-Jung Tsay
Harvard Business School
Working Paper, May 27, 2014
We investigate whether organizations can create value by introducing visual transparency between consumers and producers. Although existing theory posits that increased contact between the two parties can diminish work performance, we conducted two field and two laboratory experiments in food service contexts that suggest that the introduction of operational transparency improves service quality and efficiency. The introduction of reciprocal operational transparency contributed to a 22.5% increase in customer-reported quality and reduced throughput times to 67.5% of standard. Customers who observed employees engaged in labor perceived greater effort, appreciated that effort, and valued the service more. Employees who observed customers felt more appreciated, and in turn, were more satisfied with their work and exerted increased levels of effort. We find that transparency, by visually revealing operating processes to both producers and consumers, generates a positive feedback loop through which value is created for both parties.