Martin Ellingham, business leader for Aptean Respond, examines why resolving complaints within the required eight week timeframe simply isn’t enough for complaints excellence in the financial services sector.
With a raft of legislative and regulatory requirements to meet, the financial services sector is no stranger to compliance. This is especially true when it comes to the issue of complaints resolution. Onerous regulations as to how customer complaints should be handled add to the pressure that financial services businesses are already under. Additionally, regulators now make full use of complaints data to gauge how well businesses treat their customers, ensuring that successful complaint resolution is ever-present at the top end of the priority list for financial services.
Compliance aside, more financial services businesses are realising the value that’s to be derived from successful complaint resolution, representing a vital tool for nurturing customer trust and loyalty. With this in mind, these businesses are looking past compliance and instead pursuing best-practice that stretches above and beyond what’s required by the Financial Conduct Authority (FCA).
Speed to resolution
The best example of this concerns the time taken to resolve complaints. As well all know, the FCA stipulates that, in order to be compliant, financial services businesses should resolve complaints within an eight-week timeframe. In reality, however, for optimum levels of customer satisfaction, this really can be a case of too little, too late.
Consider the research recently published by consultants Huntswood, which found that if a resolution is achieved within a week, 75% of customers will remain as customers. This figure slips dramatically if timescales stretch to between three and four weeks, resulting in a 50/50 chance of the customer going elsewhere. While unrealistic for businesses to meet the expectations of the 75% of customers who anticipate an immediate resolution, further findings highlight a marked increase in long-term retention rates, going from 49% to 75%, by delivering a speedier, more effective complaints experience.
Rather than focussing on the speed element, be it eight weeks or eight hours, the key is efficacy. If a complaint is resolved too quickly, there can be an assumption that there was either a lack of care or diligence. Too slow and you risk falling foul of the FCA and losing customers at the same time. It’s crucial to strike the right balance between speed and quality of outcome.
While financial services have been making real in-roads into improving their complaints management, particularly in light of all things PPI, some businesses are still struggling to get it right, or even take it seriously, occasionally losing customers in the process. It is necessary to have the right tools, information and support in place to successfully manage complaints in terms of both speed and quality of resolution. This is exactly why more businesses are turning to technology for help.
With a holistic complaint management system in place providing a single, unified view of the customer, front-line and back-office complaints staff have the resources they need to ensure robust, effective and timely complaint resolutions. By streamlining the procedures that lie at the very heart of complaints management, it’s possible to drive efficiencies across the entire process for optimum results.
That’s not to say that one-size-fits-all. Some organisations might be dealing with a handful of complaints each week, while others deal with thousands. This is why flexible, agile systems, with the option of SaaS deployment, are a must. However, the overarching issue the organisations are facing is the same: the successful management of customer complaints to boost customer loyalty and ultimately increase profitability.
When it comes to complaint resolution compliance, the FCA guidelines should really be the minimum standard for financial services businesses if they’re serious about deriving real value from customer complaints. Treated as a baseline from which to strive for excellence, the eight-week timescale is a good starting point for organisations operating in the financial services sector. With the right tools at their disposal, financial services organisations can keep one step ahead of the competition. They’re able to meet compliance requirements while exceeding customer expectations, all of which result in a real uplift in customer loyalty.