All companies, whether a Fortune 100 firm or a family business, face a trade-off when it comes to deciding whether to focus on creativity or standardization.
To many, creativity and standardization are seen as polar opposites, and hence a management paradox.
At one end of the spectrum there is standardization, the desire to reduce variance and ensure that every product, process, or customer-service encounter is exactly the same. We as customers have this expectation. When we buy our favorite products, we expect them to be of the same quality every single time.
Standardization ensures this is the case by implementing checks in the production system, setting up employee training programs, and monitoring output to catch any and all defects before they go to the customer. Many family businesses, competing with large corporations, focus on ensuring that their products or level of service are consistently higher than that of the competition. This is often a key differentiator.
In contrast, creativity is all about increasing variance, trying new things, and breaking from the status quo. Accordingly, creativity can encompass modifications to existing products (i.e., putting only red and green M&Ms in a bag for Christmas), the introduction of completely new products (i.e., the iPad), or services (i.e., Amazon offering pick-up locations).
Being creative often means taking risks, bringing together ideas from different contexts, and not doing things the same way or what has always been done. For family businesses, which are traditionally smaller, size is an advantage when it comes to creativity, as it is easier for them to be more nimble and adapt to changing customer needs.
Established wisdom and research tells us that to stay competitive, succeed, and thrive in today’s highly competitive global marketplace, companies need to adapt and be creative. While at the same time, the litigious environment most organizations operate in, along with customer expectations, push organizations toward standardization.
In our research, my colleagues and I examine this dilemma in the context of service teams. When customers have a product that malfunctions and they call their service provider, there is the expectation that the technicians will follow procedure to fix the equipment in an expedited and cost-effective manner. This is where the creativity–standardization paradox comes into play.
Our work finds that more creative teams actually have the highest levels of performance. This means equipment was back up and running more quickly, expenditure on machine parts was lower, and customers had longer times between equipment breakdowns. In the teams we studied, creativity meant trying new approaches to looking for equipment problems, expecting employees on service calls to proactively fix things that were not yet broken, and also looking at different configurations or ways to send technicians out into the field.
However, especially when it comes to the last point, the company was not satisfied. This is because the managers were very proud of their high levels of standardization and had received several awards for quality of the service. Hence, the technicians were all highly trained and given detailed check lists to complete while at a customer location.
With regard to standardization, the results of this research highlight that the teams who focused most heavily on standardization, received the highest customer-satisfaction ratings.
Herein lies the dilemma. Creativity was associated with the higher levels of performance and, yet, standardization was linked to higher levels of customer satisfaction.
Further analysis revealed however that high levels of creativity and standardization yielded the highest levels of customer satisfaction–meaning that the teams that were able to focus on both had the most satisfied customers.
But, of course it is not that simple, for the highest levels of performance were achieved when creativity was high and standardization was low.
Our conclusions suggests that organizations have to allow fully trained employees to try new things, experiment, and in effect, be creative – this helps with both objective performance and customer satisfaction. Standardization is trickier, because while customers like to know a routine is being followed, they will not be impressed if the product does not deliver.
What we suggest, based on this work and other studies in this arena, is that maybe some of the most creative tasks should be performed outside of the purview of the customer. Meaning, the customer does not need to know whether technicians are sent out in pairs, because they know this is complicated job, even though protocol calls for them to go out alone. Likewise, they don’t need to know that service providers are checking for a problem that has not yet happened, because they have seen it before with this type of machine.
Train your employees, give them a checklist, and make sure they understand the protocol, but allow them the latitude to modify, adapt, change, and create – this will pay dividends in the long run.
Professor of Management, UConn School of Business
Professor Lucy Gilson is the head of the management department at the UConn School of Business and is the academic director of the Geno Auriemma UConn Leadership Conference.