Think you know how long you’ll wait? Research says think again.

From coffee shops to customer service call centers, most people believe they have a good sense of how long a service will take. But new research from the University of Florida Warrington College of Business shows that customers often underestimate how much service times can vary, a behavioral bias with important implications for service systems and customers alike.

The study finds that being overly certain about how predictable service times are, a bias known as overprecision, can impact how people decide whether to join a line or pay for a service. In turn, it affects how businesses should price services and communicate wait times.

“Our study shows how the common cognitive bias overconfidence, which demonstrates that decision makers tend to make overly optimistic forecasts about uncertain events, can shape individual decisions and entire service systems,” explained Na Zhang, Ph.D., UF Warrington graduate and Assistant Professor at Wichita State University.

For businesses, this misconception creates an opportunity to charge higher prices. When a customer is waiting, but can’t see how long the line is, the optimal price that businesses can charge is higher than traditional models would suggest. In these “unobservable” settings, the gap between what maximizes company revenue and what would benefit customers is stark, with consumer benefit consistently negative. The study also finds that, in these settings, the price that maximizes business revenue is higher than the price that would maximize overall benefit.

However, when a customer can see how long the line is, the manager should be cautious about the price he can charge as it can be higher or lower than classical theory would suggest. In these “observable” settings, consumers can obtain positive or negative benefit, depending on how congested the system is.

At the same time, the research finds that if businesses share how long a line is during either very busy or very slow periods, they can improve revenue. When a business is moderately busy, though, the benefits of providing queue-length information are less clear and require more thoughtful decision-making by managers.

“In these cases, companies may need to be more strategic about when they share wait time queue-length information,” explained Anand Paul, PhD., E.R. Bell Professor at the UF Warrington College of Business.

For consumers, having more information isn’t always better, the research notes. Contrary to popular thinking, revealing how long the line is can sometimes reduce consumer benefit during some high-congestion situations.

“Our paper also provides important practical implications,” Zhang said. “For example, overconfidence provides a plausible behavioral explanation for the empirical findings of patients’ expected waiting times being consistently shorter than their actual waiting times in healthcare service systems.”

The complete research, “Managing Service Systems with Overconfident Customers,” is published in Manufacturing & Service Operations Management.