Over 3m complaints a year are now reported to the FSA by financial services organisations in the UK. In addition, referrals to the Financial Ombudsman Service have increased fivefold over the last 10 years. Complaints about Banking and Loan products account for over half of all complaints reported where overcharging issues have come to the fore, while misleading advice is the largest cause of complaints across the life and pensions and insurance sectors. Clearly financial service companies are struggling to keep their customer happy.
The FSA has now made aggregated complaint information more freely available and transparent following on from its commitments detailed in Consultation Paper 09/21 and continues to use this information in identifying failures by firms against complaint handling rules. Where organisations fail to treat complaints appropriately there is clearly a price to pay1. While a large proportion of the fine may well be covered by a company’s indemnity insurance premiums, only time will tell what the long term reputational and commercial impacts are for those firms that are duly fined.
Many organisations, in their efforts to meet these increases in demands have either recruited or redirected significant resources into complaint handling. While the method of complaint investigation could be seen as relatively straightforward – collect information, assess evidence and reach a conclusion (in a fair and balanced way), the skills required are not dissimilar to those of the forensic specialists seen in an episode of CSI. When you consider that the information required is likely to include emails, letter correspondence, voice recordings and product related documentation, it’s no surprise that resolution times currently take weeks and over 10% still remaining unresolved after two months.
While identifying and eradicating the root cause of complaints is the primary objective, the complex, innovative and competitive nature of financial products and their development, will mean that some customers will always experience issues. Consequently, to deliver reductions in the number of complaints reported to the FSA, organisations need to also focus on resolving complaints quickly, ideally within the next business day.
To achieve this, an effective IT strategy for complaint handling should:
- Quickly direct customers to a relevant and knowledgeable complaint handler
- Provide complaint handlers with a real time view of the customers product data and all related correspondence
- Give customers frequent and clear communication through channels that enable them to easily track and enquire about the status of their complaints.
Thankfully there are many new technologies that organisations can deploy to help. These include Natural Language Interactive Voice Recognition (NLIVR) for better call routing, Content Addressable Storage (CAS) to quickly pinpoint customer emails and related telephone recordings and Data Virtualisation to provide complaint handlers with a unified, logical view of a customer’s product holding, communications and related issues delivered in real time from disparate information sources.
Of course these are just a few examples of technologies which could be used to build a comprehensive complaint handling capability. At Altus we combine our understanding of technologies with root-cause analysis, stakeholder and data modelling techniques to design solutions that can identify the best way to treat both the symptoms and causes of complaints. Our clear visualisation of both the technical solutions and the customer experience can help avoid costly mistakes in an area of the business that has significant room for improvement judging by the number of complaints being reported.
1http://www.moneymarketing.co.uk/1008735.article?cmpid=MME01&cmptype=newsletter
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