Being obsessed with customer experience is a tough gig sometimes – every instance of poor service, inept processes and lousy systems can leave me having a less than happy day – but I recognise that I choose to be so obsessed. People in service industries, very often at the lower end of the income scale, probably have a lot more to be stressed and unhappy about right now. So maybe this is why surliness is on the rise. Or at least it would appear to be based on an entirely unscientific sample of recent interactions.
Unpacking the way in which my complaint to the AA was handled shows how a more customer-centric approach would have helped.
My recent experience with the AA resulted in a complaint which resulted in me leaving the AA, only to return as part of a much better deal with my car insurance provider. My original experience was bad but the complaints handling was not great either. However, as with all bad experiences, there is much that we can learn – in this case how to handle complaints so that they add value to the organisation and the customer.
My experience and observation of the complaint leads me to highlight five do’s and don’ts that, if followed, will turn your complaints department into a source of value for your organisation.
The AA saga continues…
Spoiler alerts: 1) this story has a happy ending 2) the film I’m Thinking of Ending Things doesn’t (well, to be quite honest, I’m not sure – it’s a good film but goodness knows what it was about).
After my long night of waiting for the AA I was left with a defunct car at the bottom of my street and, with a bank holiday weekend imminent, it stayed that way until the following Thursday, when a brief stay in a local garage returned it to working order. I thought I’d give it few days before complaining to the AA in case I needed to get them out again and, once it seemed like the new alternator was giving the battery enough power to get around, I called their Customer Solutions line.
Eventually I had to register my complaint with the AA about my lengthy breakdown experience.
It wasn’t very satisfactory!
Ofgem’s complaints report shows the problem – and the opportunities
The trouble with being a customer experience-obsessive is that as soon as you hear an item on the news about complaints reports, your carefully-planned day is ruined as you have to follow it up out of curiosity, weird as that may sound. Thus, today, the news that UK’s energy regulator Ofgem had published its review of complaints was pure catnip for me. And as someone committed to helping organisations (NextTen’s not currently working in the energy sector but that doesn’t prevent me from having an interest – and of course we’re open to offers!) I’m interested in what these reports say about the state of complaint handling – the “Cinderella” of customer experience, as I’ve said many times before.
On the naughty step
Although the survey of over 3,000 complainants found that satisfaction with complaint handling had improved by 5% since the last survey in 2016, the proportion of customers who are dissatisfied (57%) remains much higher than those satisfied with how their complaint had been dealt with.
The main contributors to high levels of dissatisfaction were the length of time taken to resolve the issue, not being kept up to date with the progress of the complaint and suppliers not providing complainants with a clear view of how long the resolution will take
Ofgem’s statement gives the impression of a regulator who’s had enough of energy companies’ lackadaisical approach, having put three of the smaller outfits – First Utility, Ovo Energy and Utilita – under compliance investigation and requiring all the others to share their improvement plans. This is admirable, as in other regulated industries the relevant bodies don’t always give the impression of being on the side of great customer experience.
I know from my experience of working in banking, another regulated industry, that mention of any investigation or referral to the FCA is enough to galvanise action, so this will generate some useful action, although there’s a risk that the effort spent in responding to the regulator and justifying action would be better spent on the actual improvement work.
Some of the responses by energy companies – as reported on BBC Radio’s “You and Yours” consumer programme later in the day – were already edging towards the defensive. Utilita said that the report was looking at complaints up to November 2017 and since then it had reduced the number of complaints. Indeed, the overall number of complaints has halved since 2014 so, superficially, it sounds like an industry moving in the right direction.
Lies, damn lies…
Taking a look at Utilita’s data – available on their website – is revealing. Overall, complaints have dropped between Q2 2017 and Q2 2018. But whilst the last quarter shows a drop-off in overall complaints, the numbers resolved at +1 day and after 8 weeks had dropped, suggesting that there’s a rump of really difficult complaints that are tough to resolve.
And that’s where the problem lies both for external observers like me, and insiders. If you can find a statistic that shows – even “proves” – that you’re doing the right thing, you will certainly want to use it. But the old adage “There are three types of lies: lies, damn lies – and statistics” applies here – the statistics you don’t share are the ones that are much more revealing.
Whilst it’s interesting that Utilita’s time to resolve is increasing I’m more interested in the stories that underpin the data. I can’t tell what the specific issues are from the data, but I’d hope that any recurrent and intractable underlying causes were being dealt with.
You and Yours helpfully quoted some social media comments – about energy companies in general it should be said – which I found much more illuminating. Most referred to the difficulty in contacting customer service to complain or to switch or just to talk to a human being. Again, that’s just a non-representative sample to support a news story, but if it were me even one of these complaints would be too many.
And that’s the problem: statistics will tell you that you’re broadly improving, but customer stories will pin-point the pain. And focusing on the really painful experiences will drive fundamental improvements in broken processes that, when fixed, will provide a platform for overall improvements in customer experience.
As a head of customer experience or complaints, you have the challenge of making the case for improvement, so you have to balance powerful anecdotal evidence of dissatisfaction with trend data to make the case for funding customer experience improvements in preference to other important projects. It’s a problem we see all the time at NextTen and over the next few weeks we’ll be publishing ideas on how you can make a robust case for powerful customer experience. It’s far too important to wait for a regulator to kick you into action.
Why your customer strategy should focus on complaints
I was half listening to the news the other day when I heard a story about a couple who were selling their new-build house at less than they paid for it “because it was sh*t”. Apparently, the poor people had got so fed up with the number of things wrong that they had wearied of their constant complaints to the builders and decided that to put it on the market. Presumably they’d felt that the loss they’d realise on the sale would be less than the stress of continuing to live there.
I can’t find the reference to the story – there’s only so many times you can type four-letter words into Google – so I don’t know who the builders in question were, although they did issue a statement to say that the customers had received compensation and repairs in line with the contract they had signed. Whoever they were though they have missed a massive opportunity. In fact, they should have paid the couple handsomely for taking the time to complain, because
complaints are the best customer feedback you can get.
So wrong, it’s right
Most companies I know invest time and money in finding out what their customers think of them. The problem with this “voice of the customer” approach is that, when applied to all your customers, it just produces an average view – i.e. what keeps most of them satisfied. Even the sainted Net Promoter Score approach frequently fails to ask the net promoters why they are so enthusiastic about the company.
I think you could just junk most customer satisfaction surveys as the surefire way to get meaningful feedback is to make it easy for the customer to provide you with it, positive or negative.
Think about it: customers who love you or who have just had amazing service will want to tell you about it and those who haven’t will also do the same.
“That’s all very well” I hear you say, “but what about the ones who don’t complain and just leave.”
To which my reply is: too bad – you probably didn’t act on the feedback from your complainers earlier – and those middling-dissatisfied customers would be unlikely to respond to your customer-wide survey.
I’ve noticed that organisations generally don’t give as much attention to complaints and negative feedback as they should do, and I think the reasons for this is that there’s a bias – reassuringly it’s a human trait – towards good news. We’re hard-wired to create a story around the way we want things to be rather than how they actually are, or indeed, how they appear to someone else.
Customers who fail to fully appreciate the products and services we’ve spent a massive effort perfecting are an inconvenience, a distraction from the narrative we’re trying to create, even when their lack of appreciation is down to something we’ve failed to deliver.
Our bias, therefore, is towards those customers who fit the norm. Unfortunately, they are not the source of innovation and improvement.
Just about managing
Dealing with customers who don’t fit the norm – i.e. the massively dissatisfied ones – is the domain of complaints management which is a frequently neglected and under-resourced area. The overriding attitude is to get the complaint dealt with as efficiently as possible, making sure the customer isn’t over-compensated along the way. Sure, you need to provide redress and to put things right, but the opportunity is often missed to find out what the customer’s desired outcome was and to do what you could to deliver that outcome, not just the initial product service.
For example, the hapless couple in the new-build house probably wanted something more than a non-leaking roof over their heads (although apparently even this was beyond their builder’s capability), they wanted a home. And whilst this isn’t an unusual outcome, I bet the building firm didn’t have the nous to sit down with their customers and find out what it was about a home that they wanted – their unspoken needs if you like. Finding and delivering against these, rather than ineptly repairing an initial botched job, would have created delighted customers.
Complaints at the core
Building a customer strategy around complaints is the efficient, if counter-intuitive, route to increasing the number of delighted customers. The elements of such a strategy should answer the following questions:
- How easy do we make it for customers to provide feedback? (Answer: it should be very easy, and through multiple channels, including social media.)
- How do we resource those channels?
- How far do we empower front line people to sort out complaints focusing on customer outcomes?
- How do we learn from feedback?
- How do we use the learning to be able to anticipate and deal with complaints before they happen?
- Who is responsible for driving through the improvements that result from root cause analysis?
Focus your strategy on answering these questions and you can drop your customer satisfaction surveys.
It all depends on the context
An unwanted set of medical visits last week resulted in an equally unwanted set of follow-up texts.
My local hospital trust “would like me to think about your recent experience in the Emergency Department. How likely are you to recommend us to your friends and family if they needed similar care or treatment? Reply 1 for Extremely likely, 2 for Likely, 3 for Neither likely nor unlikely, 4 for Extremely unlikely or 6 for Don’t know. Please reply today, your feedback is anonymous and important to us and helps us to improve our service…”
There was no follow up question in their survey – clearly they were just wanting a number.
My GP’s surgery then did exactly the same.
Yes, the much-touted and widely-discussed Net Promoter Score (NPS) was at work again!
Well, actually the experience and the care in both cases were great but I didn’t reply, but because the context of the experience means that I think NPS has no significance in isolation. If I had responded with 8 but with no opportunity for follow-on comment how can they react? If the hospital looks at their scores how can they do anything meaningful unless they have some view of what aspect of my experience is not great in the my opinion.
It got me thinking what do people use NPS for? Picture the scene if you can: someone close to you is suddenly taken ill. The LAST thing you are going to do is say “Hmm, let’s take you to XYZ Hospital, they have a really great patient experience and I’d heartily recommend it!”
If you lived in my neck of the woods you would only have one choice in an emergency, assuming it didn’t require an ambulance: the nearest hospital. And that’s in London – an area not short of “competitor” hospitals; elsewhere you most likely wouldn’t have a choice.
Similarly, signing up for a GP is not like having a bank account or a phone service: you tend to sign up long-term and don’t like to switch unless you move house. You might recommend individual doctors within a practice to your nearest and dearest depending on your experience but that’s not the question.
I asked a GP friend of mine who’d moved from my surgery to another practice whether they were using a similar measure. “Oh yes” she said, “we do the scoring as specified and then we have to send the results to the Department of Health.” As far as I can tell there is no follow-up or any expectation to do anything differently. The score was being used little more than a traffic light to gauge the surgery was performing above a minimum threshold.
So, what’s the point of NPS?
Despite its misapplication in parts of the National Health Service, the measure is partially useful, but it does not deliver quite the impact it claims:
- If I have a great experience from supplier A where various competitors are readily available, I’ll form an emotional attachment to the supplier that provided it. I might quite like Supplier A but part of the attachment is based on confidence they can do the job and trust that this will happen consistently.
- I’ll be more much likely to tell someone that I recommend supplier A and much of the time I will give them a 9 or 10. In this scenario NPS accuracy is working.
- I might be using NPS after a visit to a retailer. If I got what I wanted, and the assistant had smiled at me nicely then I would be more than happy to give a nice round 10. Then I would most likely forget I had ever been there and I never raise it in conversation again. The scoring system is not working so well.
Because it’s focused on measuring my reaction to specific events NPS is not a complete picture. The experience I have had needs to be part of a journey towards a particular outcome. To use my recent healthcare example, that journey won’t be complete until I have had a follow-up appointment and further treatment, if needed, a process involving referral and booking into the appropriate clinic. My satisfaction (not likelihood to recommend) won’t be determined until my desired outcome – good health, reassurance about future health concerns – is achieved.
And it still won’t involve me recommending any form of medical treatment, no matter how great the experience is.
Building on success
At NextTen we find it’s much more helpful to talk about customer success which we define as a combination of fulfilling the customer’s desired outcome and providing a good experience. Using these two dimensions we can build a customer advocacy matrix. High advocacy companies combine a great customer experience with a great outcome delivery, although it’s possible to achieve business success with an OK or even below-average experience as long as you deliver the customers’ desired outcomes as low-cost airlines continue to prove.
- Ryanair and Spirit: poor customer experience but great profitability.
- Kingfisher Airlines: great experience but went bust!
Context is everything
NPS can certainly tell you if you’re in the high advocacy quadrant of the matrix, but you’ll need additional qualitative data to understand why you’re there, or if you’re not, where you need to improve. And if your market context isn’t one where high levels of customer choice or switching occur then you would be better off measuring something meaningful like the number of and reasons for customer complaints.
Even a fictional character can have a bad customer experience
George was feeling a bit strange. Together with her cousins Dick, Julian and Anne – not forgetting her dog Timmy – The Famous Five, as they’d become known, had been revived for an advertising campaign by GWR so here they were, sitting on a brand-new electric train, heading down to Dorset for some jolly adventures, no doubt involving spies and some crude characterisations.
But being brought back in 2018 was making George feel uncomfortable. It wasn’t just that, as the most “woke” member of the Five, she was beginning to find her fellow adventurers’ attitudes more than distinctly outdated. It wasn’t that everyone was sitting on the train staring at their smartphones instead of chatting and sharing out bottles of ginger beer like in the good old days – George had got her own iPhone and was looking forward to discussing the manipulation of social media by foreign powers with her father the world-famous scientist later. No, it was that she was really actually, physically uncomfortable in her brand-new seat.
To take her mind off it, she flicked to the GWR page on Twitter. There was that rather annoying picture of the Five turning cartwheels on an imaginary picnic in an imaginary countryside with a brand new high-speed train running in the background. From some of the comments on Twitter it seemed like the train might be imaginary too, as quite a few seemed to be cancelled on a regular basis. That might explain why there were so many people crammed into her compartment.
Oh well, #GWRAdventures seemed like a jolly hashtag and, of course, was all part of a jolly campaign that The Famous Five were part of. Some customers didn’t seem to be keen on joining in the fun though, and a suggestion that they should tweet some lovely views seemed to produce pictures of broken seats, worn carpets and more overcrowding. Honestly, people could be really grumpy at times!
As she reflected further she realised her brand-new seat, whilst not broken, was really quite uncomfortable, even for an imaginary character in a children’s adventure story. Having become bored with the incessant trolling on Twitter she took look at Facebook. Goodness, people were even more grumpy on the GWR Facebook page than they were on Twitter! There was a lot of moaning about cancelled trains and, she was encouraged to read, some people found the new seats were jolly uncomfortable too.
Strangely though, there wasn’t much response from GWR to these complaints on either the Facebook page or the Twitter account. They seemed awfully keen to respond if someone said something nice but didn’t really engage with any negative comments at all other than to say that “people’s concerns would be recorded”. Really, thought George, that seemed rather impolite to say the least.
Although George liked being out of doors, solving crimes and rescuing her father from the clutches of evil villains, she thought if she ever grew up and had to settle down she’d like to be a head of customer complaints. You could really get things done if you listened to what the customers found most annoying, were honest with them about your shortcomings and then did something about it. That sounded like the kind of grown-up adventure she’d really enjoy.
But maybe for another company, not for GWR.
For a really effective way to manage complaints profitably, you have to be prepared to learn
I don’t often look to fictional characters for management advice, but if you’ve had any exposure to the Star Wars universe, you’ll know that diminutive Jedi master Yoda is capable of some cornball wisdom that occasionally hits the spot.
When it comes to complaints management his line from The Last Jedi “the greatest teacher failure is” pinpoints the difference between organisations that thrive on complaints management and those that would rather sweep their customers’ gripes under the carpet.
As I’ve mentioned before, complaints are a goldmine of opportunity for turning grumpy customers into raving fans and gaining enhanced revenue as a result. But to do this you have to have a fully joined-up approach that covers detection, handling and learning.
Back in 1990, Peter Senge, then Director of the Systems Thinking and Organisational Learning Programme at Sloan School, MIT, published a seminal book, The Fifth Discipline, that introduced the idea of the “Learning Organisation”. Re-reading it, I’m struck by how much advice it offered appears to fall into the category of the “bleeding obvious” – but on reflection has still not been adopted by most businesses.
Maybe the concept of a learning organisation sounds too academic, non-action orientated, even un-business-like to have gained real traction, but in the world of customer complaints a learning organisation focused on customer outcomes is exactly what you should strive to become.
Let’s reflect on Senge’s five disciplines of a learning organisation and see what they tell us:
- Systems thinking – the need to view the organisation as a joined-up whole, where actions in one part may have a positive or negative implication in another. Forgetting to think systemically is a trap that complaints managers can fall into. Actions with a positive effect in one area may result in negative effects elsewhere. Looking at end-to-end process rather than silo boundaries can help prevent this.
- Personal mastery – the requirement for individuals to commit to a process of wider learning, as the basis of organisational learning and therefore impact. This is straying into Yoda territory, but you need people who are committed to their continuous development so whilst fairly obvious, is key to managing complaints effectively, particularly as wider perspectives can be considered.
- Mental models – the need to test the assumptions held by individuals and the organisation about the way things work. Challenging these is essential for customer-centric innovation, particularly in response to complaints.
- Shared vision – seen by Senge as essential in motivating staff to learn. Although vision is seen by some as an outmoded concept, anything that motivates staff – I’d prefer a strong statement of purpose (e.g. our purpose is to use our customers’ feedback as the basis for improvement) – is valid here.
- Team learning – this“Fifth Discipline” is where the organisation builds on its individual responses to learn collectively about how it can improve. The benefit of this approach is that the problem-solving ability of an organisation is significantly enhanced, so arriving at a solution to a complaint-generated issue should be easier with this discipline in place.
In the loop
My back-of-an-envelope analysis of Senge’s model says that at least 80% of it is critical to closing the loop on complaints, but what is this loop that needs closing?
Put simply, there is a virtuous circle that organisations can put themselves in where what you learn from a failure to delight your customers feeds into improvement activity and a renewed commitment to detect when customers are unhappy.
In fact, this process is a version – admittedly rather high-level – of Senge’s first and most important discipline, systems thinking. So, how do you inject this approach into learning from customer complaints?
Beat the system
Anyone reading this piece who’s involved in complaints will be familiar with the various quality and other techniques used in Root Cause Analysis (RCA). I won’t reiterate them here – like any tool different techniques are applicable in different circumstances – but there’s a danger with the RCA approach. You may be able to get solutions that address the complaint but miss the big picture – or the organisation may feel that the big problem that’s preventing a breakthrough in customer satisfaction is too difficult to address.
The organisation can then find itself in the opposite of a virtuous circle where the solutions implemented from RCA fix point problems in the customer journey but don’t have much overall impact. As a result, RCA will be starved of the resource it needs to do a thorough job on the complaints in its workstack, results will be sub-optimal, and the cycle will continue.
To avoid this, complaints organisations need to make sure that they focus on customer outcomes – i.e. the underlying reason why the customer was using the product/service in the first place before things went wrong. This big picture thinking increases the likelihood of everyone addressing the underlying issues and, if your organisation is practising the other disciplines, it will pull together to fix them.
Here in Britain we’re recovering from a crisis (I may be exaggerating) in the fast-food world. Fried chicken purveyor KFC found itself unable to meet demand for its fowl-in-fat products following a switch of logistics supplier. The situation was so bad that it had to close most of its stores while it sorted out the issues. This is a clearly a big cock-up (I’m not the first to make that joke) and the advantage, if there is one, is that the error is glaringly obvious and therefore getting to the root cause should be straightforward – and resources will be thrown at the problem to solve it quickly.
KFC have done a good job of responding, at least in terms of publicity, with a public apology and long-term probably won’t suffer too much.
However, what’s obvious, to me, is that KFC failed to pass on the learning from one supplier to another: the logistics involved in getting chicken hygienically from slaughter to fryer are highly sophisticated, apparently. I assume that their previously logistics supplier had refined their approach in response to customer and front-line feedback, but this learning clearly hadn’t made it to the new provider. In an outsourced environment, keeping the virtuous circle of a learning organisation in motion is even more of a challenge.
As Yoda might have said, “learning organisation the biggest challenge is”.
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You need a strategic approach to managing complaints that focuses on customer outcomes as much as what went wrong.
I recently described complaints as being an under-exploited goldmine of customer feedback. Companies need to widen their focus from purely complaints i.e. dealing with the “expression of dissatisfaction” to a more strategic approach that I refer to as “closing the loop”. This means joining up the three main parts of complaint management into a coherent programme that’s focused on change and improvement in the quality of overall customer outcomes as much as customer satisfaction in relation to the original issue.
Why is this important?
According to market researcher Pierre-Nicolas Schwab, in a 2015 article, the data shows that complaints from customers are not taken that seriously or are ignored.
- More than 50% of companies don’t answer complaints
- In 2013, post-complaint satisfaction was still at 1976 levels (RAGE survey 2013)
And, looking at the latest US RAGE survey, $313bn are at risk because of dissatisfaction in the US alone.
It’s time to get strategic.
It’s time to close the loop.
It’s rare that companies adopt this approach – or if they do it’s underpowered – and – as the statistics above show – it represents a great opportunity to create differentiating customer value. The underlying components are simple to describe:
- Detection – identifying the complaint or the potential complaint and averting it if possible.
- Handling – dealing with the complaint when made and restoring the customer back to the state they were in before the error occurred
- Learning – identifying what went wrong at the “root cause” level in relation to either stated or expected customer outcomes and then taking action to:
– prevent future occurrences
– identify the potential contribution to the wider outcome-driven operating landscape.
This last part will be different from traditional best practice, but the complaint interaction creates a fantastic opportunity not only to repair the issue but create a level of loyalty – and therefore business impact–over and above what could have been achieved if the complaint had never happened.
In other words, customer complaints can be used as the basis for customer innovation – and in my experience very few organisations are currently doing this.
Detect and survive
Going back to basics. The front end of complaint handling takes place before a complaint is made and, at best, avoids the complaint being made at all. This requires the ability in each contact channel to detect imminent dissatisfaction and take action to deal with it.
Different channels will require different skills to carry out this, for example:
- Face-to-face channels require staff who can pick up on the visual cues that a customer is potentially irritated.
- Similarly, an experienced agent in a call centre should be able to detect from a customer’s tone of voice that they are unhappy.
In both these cases situational training and role play can help build competence since not all of your staff will be naturally empathic.
In the digital world we have not yet reached a point where machines can match an experienced front-of-house manager or call centre agent for empathy but there are various ways it can be simulated. It’s possible to detect if a customer’s online journey is particularly slow and then to prompt with help and support messages. Similarly, the availability of an online chat button means that customers can divert to a human (or chatbot) for support rather than getting frustrated with an online experience that’s not working for them.
But online doesn’t just mean websites: social media are increasingly an opportunity –in some cases the preferred channel – for customers to vent their dissatisfaction. Early detection here is crucial given the propensity for some grievances to go viral. It pays to have a light touch when dealing with these – as UK retailer Argos did in a “street speak” exchange with a disgruntled would-be PS4 purchaser back in 2014: the amplification performed by the Twitterati performs a handy bit of brand enhancement.
This front-end detection isn’t always possible however as the customer may be complaining about something long after that initial first point of contact so it’s vital that the customer can raise a complaint easily. In fact, complaint and feedback should invariably be encouraged.
Sometimes you can go to a company’s website and immediately find out how to provide feedback – I recently raised a complaint with UK bank TSB and could find it within a couple of clicks (the eventual resolution wasn’t great but that’s another story) and everyone’s favourite First Direct is similarly easy – but other businesses are a bit more coy, relegating complaints to a more obscure area – in the case of NatWest’s personal banking site for example it’s hidden in the Support Centre which, to me at least is less than blindingly obvious.
This attitude suggests that some businesses don’t welcome complaints or any kind of feedback, which is nuts, since finding out what customers think of you is, you know, quite a good idea.
But people don’t actually like complaining (unless they’re a CX-obsessive like me, but even I can get worn out by the sheer tedium of it) so it pays to make it easy or to incentivise through competitions – entering a prize draw – or vouchers (Pizza Express’s How Did We Dough? for example). Personally, I think the instant gratification of a low-value item is better than the chance of a prize, since it says that the business values your opinion – but maybe I just like dough balls.
Getting your “complaints radar” working on all channels is key to minimising the actual complaints you have to deal with. They may be a great source of feedback, but once a complaint is made it’s costly to process and provide redress so early intervention is always preferable.
In the next part of this series we’ll go on to consider how to handle the complaint effectively when it is made and how focusing on the customer’s intended outcome will help deliver a resolution and an enhanced overall experience that can change a detractor into a raving fan.