Find out the best way to assess the effectiveness of a global best practice complaints and inquiry management process - from one of the top global experts on the subject!

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keep
complaining
32 Qualityworld
part 2
When it comes to
complaints management,
a coding system can set
you apart from
the competition.
In his second
article, Ted Marra
explains how a coding
system will facilitate
effective analysis for
improvement and make
the mundane business of
complaints part of the
marketing strategy
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2. Qualityworld 33
feature
The codes and their structure are the key.
They represent an effective and efficient
way of capturing in the system the reasons,
problems, probable causes or other infor-mation
which an organisation needs to
know if it is to set priorities and take
action for improvement.
Often organisations have just a few large
buckets for problems to fall into, like prod-uct
or service, for example. The conse-quence?
Management sees that its
organisation had 600 service complaints
last month. That’s a large number, they say.
What do we need to do? No one knows
the details. Valuable resources and time
then have to be committed to find out
what is happening or has happened. Do it
right the first time - put an effective cod-ing
system in place at the start.
Effective codes will possess a number of
key characteristics. They should be:
• mutually exclusive so as to avoid ambi-guity
• actionable so that they begin to point
you in the direction of improvement
• dynamic in that they are regularly
reviewed and updated
• comprehensive and therefore cover all
aspects of the customer’s experience
with your organisation
There’s a hole in my bucket
Unfortunately, many organisations still
utilise large buckets only. That is, they cap-ture
only whether it is a sales, service or
product issue, for example. So in a given
month, if there are 600 service complaints,
everyone can review the data and say: ‘We
seem to have a lot of service complaints
this month!’ No one quite knows what
they are or why they have occurred, only
that there are lots of them. This is not par-ticularly
helpful.
Figure 1 gives an example of best-in-class
codes for service repairs for Thomson
Consumer Electronics, a consumer elec-tronics
manufacturer. As shown, going to a
second level of specificity is helpful, but if
the cost of repairs begins to grow, you still
don’t know what to address, so you really
need to go to the third level of detail.
That’s when your coding system becomes
actionable and helps speed you towards
improvement actions rather than have to
spend an inordinate amount of time and
resources trying to figure out what the 600
service complaints are all about.
The coding system should be comprehen-sive
in that it considers every aspect of
where things can go wrong within the
Establishing a coding system is
one way of setting yourself apart
from other organisations. Xerox
Canada has been successful for
years in negotiating resolution
times on a case-by-case basis with cus-tomers
- no doubt a frightening prospect
for some organisations to contemplate.
Many organisations use regulatory require-ments
as an excuse not to be better, where-as
others strive to be the best. Royal Bank
of Scotland, for example, has as one of its
objectives to be ‘world class in service
recovery’. It is clearly looking to differen-tiate
its level of responsiveness and effec-tiveness
in the complaints arena. This is a
smart move, as you will see.
If the true value of a complaints manage-ment
system were assessed internally it
would have to be based upon the quality
of information it can provide to the various
parts of the organisation - product devel-opment,
service, sales, quality and many
more. With the right information, organi-sations
can drive process, product and ser-vice
improvement. The key is capturing the
right information during the interaction
with the customer and coding it in such a
way that it facilitates analysis, interpreta-tion
and reporting of information.
Not fixed right first time
Repeated repair - same problem
Repeated repairs - different problem
Authorised service not performed
Inability to repair
Rudeness/interpersonal skills
Attitude
Intimidating location
Dirty
Parts
Labour
Parts/labour
No estimate given
Repairs significantly exceed estimate
No published repair rates
Cost of repairs
Quality of service
Non-responsive servicer
Difficulty in obtaining/scheduling service
Servicer refuses service
Equipment not ready when promised
Servicer workload - customer told to
come back later
Figure 1. Coding scheme for repair service complaints
Quality of service
(Technical capability/competence)
Professionalism
Facilities
Cost of repairs
Delay in servicing
Other
Repair service
Repair at unauthorised location
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3. Analysis
Reporting
Review and act
Management process
Administrative Human resources
context of the customer experience and all
the individual engagements the customer
can have with your organisation. Figure 2
is a chart for a telecommunications organi-sation.
What does the engagement map
look like for your organisation and where
are the problem areas?
Getting validation
Validation is where the true test of the
effectiveness of the organisation’s com-plaints
management process is determined.
A validation process allows us to return to
the customer after the case has been closed
to determine how satisfied they were with
the actions taken, whether the relationship
has been preserved and to gain helpful
information for improvement regarding the
process and people the customer encoun-tered
in getting the issues addressed.
34 Qualityworld
Repair service/maintenance
Technical support
The key issue here is: ‘When is a case offi-cially
closed?’ This has been found to vary
from organisation to organisation. Best-in-class
organisations tend not to close a case
until final action has been taken. There
may be exceptions, but not many. The rea-son
why this issue is significant is this final
action should be the trigger for sending
out a validation survey.
The first question on this survey is simply:
‘How satisfied (on a 1-5 scale, for example)
were you with the actions taken?’ If no
actions have yet been taken, then you may
receive an unwelcome response from the
customer, which could lead to reopening
the case.
Beyond that, it is always a good idea to
include feedback on satisfaction with peo-ple
issues (eg professionalism, empathy,
responsiveness or others) and process (ease
of getting the issue addressed, clarity of
response and so on) as these often lead to
identifying opportunities to improve the
process, areas where staff may need better
training or where they should be recog-nised
for their efforts.
The final question should relate to whether
or not the customer would still continue to
recommend your organisation to friends or
colleagues despite the issue encountered.
This is the surrogate loyalty question and
the answer will indicate whether the rela-tionship
has been preserved or damaged.
A complaints checklist
So before you embark on a complaints
management programme, there are a num-ber
of questions you need to consider.
How comprehensive and effective is your
complaint coding system?
• do you capture actionable data?
• are the codes mutually exclusive to
avoid confusion and better ensure con-sistency
of application?
• are the codes revised on a regular
basis?
Process effectiveness
measures
• Pareto analysis
• Review and interpretation
• Severity assessment
• Operations/line management
• Departmental/functional
• Senior management/staff
• Prioritisation
• Resource allocation
• Form problem-solving/
process improvement teams
feature
Customer
purchase
consideration
Purchase cycle
Sales process
System design
Delivery Installation
Training
First
invoice
Order
submission
Credit
review
Account maintenance
Customer
purchase
decision
Customer
purchase
consideration
Figure 2. Customer engagement points
Figure 3. Enquiry, problem and complaint process
Planning
Critical success factors
There are certain factors which are more critical to
the success of an organisation’s complaints man-agement
process than others:
• highly visible, easily accessible channels of
communication of problems and complaints
• customer awareness/education of how to com-plain
and where to complain
• employee empowerment
• effective data capture, coding, analysis and
reporting to facilitate prevention
• standard operating procedures including
process definition (map), definition of com-plaint
and criteria for escalation as well as pro-file
of staff
• process and outcome effectiveness measures,
review, priority setting and action (including
root cause and prevention)
• teamwork, as many issues are cross-functional
and require fixing the customer first before
worrying about whose budget the cost will be
absorbed in
• continuous improvement of the complaints
management process
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4. Beyond that, the data and information
should help with planning of customer-related
initiatives. It should be factored
into staff recognition programmes, train-ing
initiatives and performance evaluation.
Regular QA activity should occur in terms
of consistent use of codes, updating of
codes, elimination of outdated codes and
ensuring data integrity, system updates etc.
The bottom line
What about the bottom line? A five per
cent reduction in the number of customers
leaving your organisation due to a com-plaints
issue can double your profit. And a
one per cent increase in customer loyalty
can lead to an average nine per cent
increase in overall profitability. In fact,
there is a lot that can be done in terms of
better quantifying the economics around
complaints management. What would a 20
per cent reduction in complaints add to
your bottom line? What if you could
extend a customer’s period of loyalty by
25 per cent - what would that add to the
bottom line? This is only the beginning.
But there are clearly often cultural issues
that must be overcome as a first port of
call. In many organisations, complaints are
still viewed as a costly nuisance rather
than a marketing opportunity, and cus-tomer
service is viewed as a cost centre,
not a profit centre. The focus needs to be
on prevention - and not just good fire-fighting.
Effectiveness of resolution is far
more important than the absolute level of
complaints.
Soliciting complaints can be good business
strategy as non-complainers (the silent
majority) can represent 35 to 70 per cent
of customers experiencing a problem with
your products and services. Complaint vol-ume
is not a good measure of satisfaction.
A complaints management process should
be viewed as the bedrock of any effective
customer relationship strategy
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What process do your people use with cus-tomers
to ensure effective problem or com-plaint
resolution?
• how do you ensure the exact problem
or issue the customer is having has
been determined?
• do you assess the severity of the issue
from a customer perspective?
• how effectively do your people defuse
angry or hostile customers?
• how effectively are they able to negoti-ate
a solution?
• how good is the follow-through in
meeting commitments made to the cus-tomer?
Under what conditions do you elevate a
customer issue to a higher level in your
organisation?
• are there criteria in place?
• are they consistently followed?
• are escalated issues treated differently
than other complaints? How and why?
What approach do you have in place for
determining how satisfied your customers
are with the resolution of their problem or
complaint?
• how do you know if their relationship
has been preserved and their loyalty
maintained?
A is for action!
In the end, gathering all the complaint
data in the world won’t help anything
unless someone acts on it. It is amazing
how many organisations fall into this trap
and keep trying to dig themselves out. The
complaints data keeps piling up, but no
one does anything with it.
What do you do with this data? Can you
name three improvements that have come
from taking action on complaint data in
your organisation in the past 12 months?
That is, after all, the point of having a
complaints system: to improve. Figure 3
shows some of the key aspects of the man-agement
process. Clearly, it has a lot to do
with aggregation, analysis, interpretation,
reporting of data, priority setting, action
planning and improvement of products
and services. But which of the issues lead
most quickly to customer disengagement?
This is where further analysis is useful.
Complaints from the inside out
The next step is to ask: who are your
organisation’s internal customers for this
data? Who could benefit from having
knowledge of it? Who is utilising the data
currently and what are they doing with it?
Into any review meeting should come not
only the rich complaint data and informa-tion,
but the key process effectiveness mea-sures.
How do you know if your
complaints management process is work-ing?
Is it effective? These are key questions
that must be asked.
Measuring the number of complaints is the
single worst measure you could choose. It
causes people to perform unnatural acts to
avoid formally capturing complaints - par-ticularly
since most professionals seem
intent on issuing an objective to reduce
complaints.
Ted Marra is president of Marra Quality Inc, which
focuses on performance and relationship excel-lence.
He has been vice president at Walker, CSM,
president of consultancy, Care Associates and of
TARP Midwest. In these positions he concentrated
on the design, pilot testing and full implementation
of customer complaint management processes.
Q
Qualityworld 35
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‘Measuring the number of complaints received causes people to perform
unnatural acts to avoid formally capturing complaints - particularly since most
professionals seem intent on issuing an objective to reduce them.’