Paul Clark, CEO of Charter UK examines the reasons why some companies are consistently bad at resolving customers' complaints.
The impact of these moves will affect systems and process. Indeed the move from a 2 stage to a 1 stage complaints handling process will be a real challenge for financial organisations. In the enterprise market, companies grown by acquisition often count a myriad of different business units, as well as an IT culture which restricts radical change. Furthermore, fixing process issues will also require cultural change. A consistent approach to complaints will necessitate a thorough and clear view of complaints, and the process changes and software capabilities needed.
Some firms are very hot on the issue, employing a proactive complaints handling process– others have been content to follow a 'bare minimum' approach to the issue.
Recently, the FSA has made the issue of complaints a top priority, and is implementing new legislation to regulate the way that complaints are dealt with. Historically, the financial services industry has been something of a mixed bag when it comes how different institutions approach and deal with complaints and how they respond to customers. Some firms are very hot on the issue, employing a proactive complaints handling process– others have been content to follow a 'bare minimum' approach to the issue. However, with ever increasing pressure from the FSA which is acting quicker and increasing penalties for non-compliance, the culture of complaints handling is going to have to change. The move from a 2-stage to a 1-stage process will mean that companies will all now have to investigate complaints thoroughly first time, every time. Also, they will need to comply with the FSA's incoming regulation, which required regulated firms to nominate an executive responsible for complaints - a 'head of complaints' - by September 1st 2011 (CP 11/10).
And it's not just the financial services sector that is being scrutinised about the way they deal with their complaints, with British Gas recently facing a large fine for poor handling of complaints. In any situation where large volumes of complaints recur, there is likely to be a 'root cause' that needs to be addressed. Many large institutions struggle with effective systems and processes in terms of identifying these root causes. But could culture be the real problem?
'Many large institutions struggle with effective systems and processes in terms of identifying root causes. But could culture be the real problem?'
Systems and process changes are easier to change than culture. It is a given that culture starts at the top. But it is important not to forget that the efficiency gained by instituting changes in the complaints handling arena in a company will often save vast amounts of money, in some cases up to 60 % improved efficiency. Faced with such a potentially positive return on investment, boards should have less of a problem swallowing what has often been seen as a bitter pill of changes to the process and culture of handling complaints. Once seen as a nuisance by many, with tighter regulations, complaints must now be treated as a priority or face the consequences.
Companies must embed this culture and must be willing and able to apply best practice. They must start to accept that a programme of continuous improvement will need to form a core part of their normal day-to-day business activities, creating robust root cause analysis as well as meaningful management information (MI) to demonstrate that their complaints handling is in accordance with the FSA's requirements. Everyone dealing with complaints, from the call centres to the branches and online support teams, will need to be as prepared and highly trained as possible. If the senior management make it clear that good complaints handling can offer valuable opportunities, this attitude will spread throughout the company. The new 'head of complaints' will be responsible for overseeing the entire process and their seniority and clout should ensure that the complaints cannot be treated as low priority .
'If the senior management make it clear that good complaints handling can offer valuable opportunities, this attitude will spread throughout the company.'
The social media space is increasingly offering a perfect platform for the customer's voice, be it negative or positive. This is having a growing impact on the reputation and brand control of every organisation. While it is not all about keeping the customer happy at all times, it is important to allow customers to voice their complaints in a setting that allows companies to capture and respond to customer feedback in a way that they can control it. This has made complaints handling all the more important. Correct culture, systems and processes must all be in place for companies to be able to deal with complaints in social media because of the potential damage to brand reputation. All complaints must be dealt with quickly, before negative feedback about the brand can be spread. One complaint can be re-tweeted, for example, and become visible to thousands in a matter of minutes. Customers have a much louder voice with the help of social media and all companies need to be diligent and fast-acting to protect their reputation.
'The social media space is increasingly offering a perfect platform for the customer's voice, be it negative or positive. This is having a growing impact on the reputation and brand control of every organisation.'
What has become clear is that the underlying issues driving poor complaints handling need to be rectified as quickly as possible. The right software, management and training can help with system or process failures and all of the other factors such as reputation management and tighter regulation will help to push a change in the culture of complaints.
Correct and efficient complaints handling has to be looked at in terms of systems, processes and culture. Most companies come at it from a system and process failure first, rather than culture. But culture is key to changing the way an organisation looks at complaints, and it's importance cannot be overlooked.
