Features | 20/06/22

Today, most financial organisations have a robust complaint management process in place, but will this be enough for tomorrow? The past couple of years in particular have resulted in not only a rise in complaint numbers but an increase in customer expectations too, creating a perfect storm of complaints for financial services organisations to manage.

As well, the complaints we’re seeing escalated to the Financial Ombudsman Service (FOS), a figure that has risen 58% year-on-year, are indicative of past practices, the impact of older decisions playing out in today’s complaints. In a similar vein, what we see tomorrow, will be a reflection of the practices of today.

So, with all this in mind, if you’re looking to go beyond a tick in the compliance box, fulfilling compliance obligations whilst focussing on customer experience and operational excellence, what steps do you need to take to ensure that all-important five-star complaint handling is not just for today but for the foreseeable future?

To achieve quality outcomes, mitigating against referrals to the FOS, you need to instil quality right across your complaints processes. However, defining a one-size-fits-all standard for quality is nigh-on impossible, dependent on so many different factors, many of which will be personal to your business.

But that’s not to say that making some changes won’t have a dramatic impact on quality, reducing FOS referral rates in the process. Take customer communications for example. Many complaints and escalations in particular can be avoided by higher quality customer communications. Better management of customer expectations builds trust and nurtures patience in the place of frustration.

Similarly, if you focus on individual customer circumstances, ensuring a more nuanced, personalised approach, monitoring interactions and making necessary corrections, quality outcomes are far more likely.

We all know that speed doesn’t always equate to quality outcomes, but it’s an undeniable fact that in many cases, first point of contact (FPOC) resolutions are preferable. Research shows that 75% of customers will remain as customers if you achieve a resolution within a week. Stretch this to three-to-four weeks and there’s a 50-50 chance your customers will go elsewhere.

What’s standing in the way of FPOC resolutions is a combination of factors, none of which are insurmountable. A culture of empowerment and engagement is a must if you’re to have a team of case handlers who are capable of achieving FPOC resolutions, a culture that can be built with the right training programme, not to mention the hiring of employees for behaviours and not just previous complaint handling experience. The right tools and information are crucial, such as equipping case handlers with the systems and templates (where appropriate) needed to underpin swift resolutions. Finding the right balance between speed and quality is what counts.

Not unrelated to the issue of FPOC resolutions is how you can optimise resolution timeframes. Just because the FCA calls for complaints to be resolved within eight weeks doesn’t mean that you need to take the full eight weeks. It’s a deadline, not a target. But with customer expectations increasing all the time and complaint volumes showing no sign of decreasing, managing and prioritising complaints efficiently and quickly is proving to be problematic, resulting in businesses taking longer than the mandated eight weeks.

Whilst there isn’t a silver bullet, a total case management approach is becoming more commonplace, with cases ‘owned’ early on in the process and managed end-to-end by a named individual.

The FCA’s Consumer Duty, set to come into effect in April 2023, will have a major impact on your complaint handling. The onus is on financial services businesses to demonstrate and evidence how they are ensuring customers are making the most of their money, delivering products and services that underpin sound financial decisions. For many businesses, knowing where to start is often the biggest hurdle, with uncertainty surrounding just what information is needed.

This is where it’s crucial to unlock the true value of your complaints data, using your established processes, such as voice of the customer, root cause analysis, and complaints information, to firstly identify any gaps in your data, and, secondly, to identify which priority areas demand attention.

As financial services businesses strive to go beyond the norm with regards to complaint handling, building a culture of continuous improvement is key to underpinning five-star complaint handing today ready to meet the challenges of tomorrow.