Industry updates

Each month we send a market update to key figures in the industry.

We cover the most important issues and give our honest opinion about the current hot topics. Catch up with our views and reviews by looking at the archive below.

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Are you learning from your complaints?

The Financial Conduct Authority has recently published data on the number of complaints reported by firms for the first half of 2017. A staggering total of 3.32 million complaints were received in the first half of 2017, up 10% from the second half of 2016. General administration and customer service complaints have risen from 27% to 38% of the total complaints over the same period.

It is inevitable that firms will have complaints and having a system to manage them which has clear objectives, accountability and internal review is a pre-requisite for any business. Often the procedure works well with most complaints being satisfied in a very short period, normally between 1 and 8 days. However, £400m was paid out by financial services firms in compensation during the first half of 2017, not including PPI claim settlements, suggesting that many complaints are resolved by companies “throwing money” at the problem.

In our experience firms often focus on the process itself looking for early resolution to make the complaints go away, but they miss the root causes and the opportunities that brings. Complaint handlers normally do a good job; they are not the issue. Firms need to spend more time analysing complaints, looking for trends and determining what should be changed or improved within the business to learn from their mistakes and prevent repetition. Management support of continuous business improvement is often lacking with the result being an inability to correct the fundamental problems.

We have seen some good solutions, including central change functions that can support and control improvements, but also help embed a culture that reflects the acceptance of change.

From a regulatory perspective, we are now in a principle based environment and firms need to ensure that complaints are no longer seen as a bottom-line cost. They should be recognised as more of an opportunity to identify wider issues and support customer-led improvements across their business.

Rockstead is well placed to help; many of our reviews now focus on complaint and business improvement procedures so please get in touch to discuss your requirements.

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