What Transactional Business Looks Like
The Costs Are Multiple And Painful When Operating Transactionally
Like many, I have been buying up all sorts of tech toys recently. The home office has gone through some upgrades and the ques outside of the computer store I visited a few days ago, show I am not the only one.
Firstly, there was a 'Covid Que' outside of the store. No complaints there - in fact, this was great to see. I waited behind about 20 customers and eventually got into the store. I get the attention of a young advisor and talk through what I need, show him the pictures of my home set up, and he gives me my options. I choose one and I am on my way.
The obvious happens when I get home - it doesn't work. We quickly realise that I needed a Modem/Router and not just a Router, which was the one I was advised to buy. Cue frustration. I called the store and the Manager told me to return and they would offer an exchange. A standard policy to expect, but one I was not satisfied with. After the Manager spoke with the advisor that served me (to get all the facts), he would blame me for giving him the wrong information about our internet set up. Cue agitation!
Not only was I getting irritated, but the problem with going back to the store is that it would cost me 1.5 hours that I did not have. And with video meetings that afternoon, I was now under extreme pressure. So I asked the manager of the store, "Do you think it is okay that I have to pay for your staff's mistakes?" The response...
"What do you mean? We will happily exchange..."
I then explained the pressure on my time, and that this costs me and my business dearly. After a few exchanges, the Manager offered me a $10 discount. A nice gesture if a little patronising. The Manager then explained that he does not have the authority to give away gift cards, credits, or to give further discounts.
To this point everything in this exchange has been purely rational:
Customer goes to store,
Customer talks to Advisor,
Customer buys product,
Customer finds out it is the wrong product,
Customer calls with complaint,
Exchange is offered.
This is what Transactional Business looks like. What are the problems with this?
The Customer is left feeling short changed. In a time when many are struggling while this store is one of only a few retailers selling more rather than less, the context of the cost to the customer is not taken into consideration.
The Advisor does not feel safe enough to admit a mistake. I felt sorry for him. He made a mistake. An honest mistake. But, he felt defensive and stood his ground as admitting the mistake would have cost his reputation (and possibly more). At this point, working in an environment of psychological safety would have paved the way for him to be honest and open, benefiting everyone.
The Manager has very little autonomy. In a fortunate position of being a busy operating retailer, how is it that the Manager is not able to make a decision to keep customers happy when things go wrong? A $100 store credit would have at least made me feel like they cared. And I would have brought more products from them in the future. The $100 does not cover my time and inconvenience, but it would have lowered the amount of time, energy, and grief the staff had to go through in dealing with me (a disgruntled customer).
The Business would not have suffered. The brand's reputation immediately took a hit. And, the staff would not have felt so powerless and drained. I have no doubt that the staff is under pressure and tired. This sort of Transactional Management and Systematic Transactional Exchanges wear people down. It is not said, but in the back of the staff's mind they are asking themselves, "Why should I put up with this crap?" If it wasn't for their wages they'd jump at the chance to work elsewhere. And, this type of mentality is no good for anyone.
This is a great example of what Transactional Leadership looks like. It is costly at the time of interactions (Short Term). It is costly over the course of days and months as staff are constantly drained by such exchanges (Medium Term). And, it is costly as new competitors hit the market place and give customers alternative places to shop (Long Term). Every workplace has their version of this story. Every level of management does too.
Transactional Leadership is tempting. It is characterised as the quickest, most obvious, and usually the most inexpensive solution one can think of at the time. But, it does not take into account context or the sub-text of exchanges. In tough times, people act more transactionally. No real solutions are put into place meaning that the same problems will reoccur again and again. But, those of us that are able to identify this and then re-jig the way we interact will inevitably be ready for the next challenge, the next disruption, and in this store's case - the next Technophobe!
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