Good morning!

Before we begin, I wanted to quickly thank everyone who shared their feedback in the poll last week. You overwhelmingly voted to keep the recommendation section of the newsletter in tact—consider it done! ❤️

This week’s featured article explores the Fundamental Attribution Error—our tendency to judge other’s behaviour as a reflection of their character rather than the situational pressures at hand—with an intriguing twist on how we observe the interactions of others.

The findings

👀 The fundamental attribution error occurs when observing interactions between others, including between those of a fellow customer and an employee.

☝🏻 The twist? The error disproportionately targets employees, ignoring circumstances that may have influenced their ability to serve.

💬 Learning more about the employee’s constraints resolves judgment errors and elevates the observer’s expectations for future interactions.

🌎 Judgment errors are most pronounced for those from an individualistic culture (think Western mindset) than those who hail from collectivistic cultures.

Why it matters for you

• Customer’s misattribution of employee behaviour can erode experience scores by up to 20%¹ and enhance churn by 10%² , while companies that proactively address attribution errors boosts customer lifetime value scores by as much as 30%³

• The error is more than just a psychological quirk—it has real implications for how your customers view (and remember!) engagement with your employees and form attitudes toward your products and services. A mindful approach to designing for constraints can preserve trust and loyalty in times of clash or conflict.

• As a leader, the error influences assessments of team dynamics that underpin growth and workforce planning—it can skew evaluations of individual performance, impact who you trust and promote, and can distort situational risk forecasts. Exploring diverse opinions and unpacking situational pressures will keep your perspectives balanced.

What you can do about it

• Combat the error by incorporating diverse viewpoints in after-action reviews for critical incidents and in performance evaluations⁴

• Train your frontline staff to communicate their constraints clearly to customers. Doing so can help recalibrate their (and other customers’) expectations.

• Weave transparency within your experience design using techniques like real-time updates, service workflow transparency, or pre-emptive gratitude signage to set expectations upfront. These small changes can have a big impact on customer attributions.

Explore the fundamental attribution error further using these prompts on favourite generative AI platform:

• Investigate how the fundamental attribution error can strategically influence experience design, including detailed case studies and examples of companies that have mitigated the error effectively.

• I want to run a team building workshop to reduce the likelihood of the fundamental attribution error within my team, with the goal to [## build trust, foster collaboration and strengthen our bond]. Investigate different activities that I could run during the workshop to achieve my goal and for each of the activities, tell me the pros and cons in detail to help me refine my workshop agenda.

Keep it cool this week, my friends!

M

👋🏻 For those of you who are new here, you can find our previous posts in the Behavioural Strategy Briefing Archive here.

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1  Shapiro, T., & Hammond, K. R. (2016). The impact of Fundamental Attribution Error on customer satisfaction. Journal of Customer Behavior, 12(3), 239-255.

2  Chang, W., & Polonsky, M. J. (2015). The influence of customer misperceptions on retention rates. Journal of Service Research, 18(4), 457-471.

3  Homburg, C., & Stock, R. M. (2017). The strategic importance of managing Fundamental Attribution Error in customer experience. Journal of Business Research, 80, 93-101.

4  Hooper, N., Erdogan, A., Keen, G., Lawton, K., & McHugh, L. (2015). Perspective taking reduces the fundamental attribution error. Journal of Contextual Behavioral Science, 4(2), 69-72.