Philipp Nussbaumer

“Enforced” vs. “Casual” Transparency -- Findings from IT-Supported Financial Advisory Encounters

In sales-oriented service encounters like financial advice, the client may perceive information and interest asymmetries as a lack of transparency regarding the advisor’s activities. In this article, we will discuss two design iterations of a supportive tabletop application that we built to increase process and information transparency as compared to the traditional pen and paper encounters. While the first iteration’s design was “enforcing” transparency and therefore proved to be a failure [Nussbaumer et al. 2011], we built the second iteration on design rationales enabling more “casual” transparency. Experimental evaluations show that the redesigned system significantly increases the client’s perceived transparency, her perceived control of the encounter and improves her perceived trustworthiness of and satisfaction with the encounter. With these findings, we contribute to (1) insight into the role of transparency advisory encounter design; (2) design solutions for establishing particular facets of transparency and their potential instantiations in tabletop systems; and (3) insight into the process of designing for transparency with socio-technical artifacts that are emergent as a result of design activities.

What you see is what you (can) get? designing for process transparency in financial advisory encounters

In this paper, we report on a study to establish process transparency in service encounters of financial advisors and their clients. To support their interaction, we implemented a cooperative software system for tabletops, building on transparency patterns suggested by the literature. In evaluations, however, we found that our design did not improve the perceived transparency and comprehensibility. Introducing the IT artifact into advisory failed to enhance the clients overall experience and even seemed to negatively influence the clients perception of the advisory process. Using the representational guidance of depicting the process and its activities as a navigable, interactive map made clients believe that interactions with their advisor were restricted to the systems functionality, thus expecting that what they see is all they can get.

Designing for Cost Transparency in Investment Advisory Service Encounters

Investment advisory services of financial service providers (FSPs) exhibit several characteristics that are detrimental to advisory quality. The interaction of advisor and client is strained by a lack of transparency regarding the advisory process (what activities are performed and why) and the information used therein (what information is used for what purpose and with what effect), as well as regarding the precise costs of the service and the recommended products. In prior research, we suggested that process and information transparency issues may be appropriately addressed with collaborative information technology (IT) artifacts. In this paper, we argue that collaborative, transparent artifacts may also be a premise of enabling cost transparency. To this end, we describe a complete research cycle of designing, implementing, and evaluating a shared cost-transparent IT artifact to support client-advisor interaction in investment advisory encounters. Evaluation results suggest the efficacy of our design in improving the clients’ perceived cost transparency as well as increase their satisfaction and their willingness to pay for the received investment advice. These findings may also challenge the common belief of FSPs that transparent, fee-based advisory services would neither be accepted by clients nor be economically viable. Practical implications of these findings for designing advisory encounters with supportive IT are discussed.

Design für Kostentransparenz in Anlageberatungsgesprächen

ZusammenfassungAnlageberatungen von Finanzdienstleistungsunternehmen weisen verschiedene Eigenschaften auf, die einer Beratungsqualität entgegenstehen. Die Beziehung zwischen Berater und Kunde ist durch den Mangel an Transparenz in Bezug auf den Beratungsprozess (welche Aktivitäten gibt es und warum) und die darin verwendeten Informationen (welche Information wird wozu verwendet und mit welchem Ergebnis) belastet, sowie in Bezug auf die entstehenden exakten Kosten der Dienstleistungen und der empfohlenen Produkte. In früheren Untersuchungen haben wir vorgeschlagen, die Themen Prozess- und Informationstransparenz mit den Mitteln kooperativer Informationstechnologie (IT) anzugehen. In diesem Beitrag liefern wir Argumente, dass solche kooperativen Tools auch eine Voraussetzung sind, Kostentransparenz zu ermöglichen. Hierzu beschreiben wir einen vollständigen Forschungszyklus aus Design, Umsetzung und Evaluation eines kooperativen IT-Werkzeugs zur Herstellung von Kostentransparenz, welches die Kunde-Berater-Beziehung auf der Beratungsebene unterstützt. Die Evaluationsresultate zeigen die Effektivität des Designs bezüglich einer erhöhten wahrgenommenen Kostentransparenz der Kunden als auch eine Steigerung der Zufriedenheit und der Zahlungsbereitschaft für die erhaltene Anlageberatung. Diese Ergebnisse stellen die generelle Vermutung der Finanzdienstleister in Frage, dass transparente, gebührenabhängige Beratungen weder von den Kunden akzeptiert würden noch wirtschaftlich zu empfehlen seien. Praktische Schlussfolgerungen aus den Ergebnissen für unterstützende IT-Systeme auf Beratungsebene werden diskutiert.AbstractInvestment advisory services of financial service providers (FSPs) exhibit several characteristics that are detrimental to advisory quality. The interaction of advisor and client is strained by a lack of transparency regarding the advisory process (what activities are performed and why) and the information used therein (what information is used for what purpose and with what effect), as well as regarding the precise costs of the service and the recommended products. In prior research, we suggested that process and information transparency issues may be appropriately addressed with collaborative information technology (IT) artifacts. In this paper, we argue that collaborative, transparent artifacts may also be a premise of enabling cost transparency. To this end, we describe a complete research cycle of designing, implementing, and evaluating a shared cost-transparent IT artifact to support client-advisor interaction in investment advisory encounters. Evaluation results suggest the efficacy of our design in improving the clients’ perceived cost transparency as well as increase their satisfaction and their willingness to pay for the received investment advice. These findings may also challenge the common belief of FSPs that transparent, fee-based advisory services would neither be accepted by clients nor be economically viable. Practical implications of these findings for designing advisory encounters with supportive IT are discussed.