Tag Archives: Reputational Risk

People Insight: Solving the CX Reiteration Relapse

What is a reiteration relapse?

The word reiteration means to say or do something again, or many times over. Relapse is often used when a person who, after a period of improvement, becomes ill again or starts exhibiting prior bad behaviours – they relapse into a previous habit or condition.

Marrying these terms in a commercial context, means to do something repeatedly, which may produce a minor improvement for a short period of time, before ultimately resulting in the same or worse outcome.

Unfortunately call centres are amongst many industries who are often caught in a reiteration relapse, resulting in poor customer experience and internal and external metrics to be lower than expected, despite the individuals’ and organisations’ best efforts.

The good news is, call centres can resolve this challenge with evidenced based insights on their biggest asset – their people.

How can we be sure?

We as are in the age of information and big data, and consumer demand has pushed organisations to become more transparent and authentic. The call centre industry, like many others, has embraced these challenges to meet ever evolving customer demands. This has enabled many call centres to provide positive and flexible working environments, and roll-out engaging training and development for a (generally) happy workforce, which is supported by increasingly optimised and refined processes.

Together these should enable all call centres and their staff to flourish, to meet company objectives and to perform against industry KPIs, whilst (perhaps most importantly) providing excellent customer experiences – every time across every touch point.

However the reality is that in many cases call centres and their teams struggle to achieve these things. The evidence can be seen on Google – a quick search will provide the details of the latest fines, complaints and below par industry metrics.

We believe this is because call centres are looking at their problems in the wrong way.

Evidence we have gathered from working with some of the largest call centres across the industry indicates that the problems they think they face are not actually the problem; but are in fact symptoms of deeper root causes.

Call centres (understandably) try to address these symptoms and improve results, typically by providing more training to their people and further refining systems and processes. Inexplicitly this often doesn’t solve the problem or provide the desired results, and when measures don’t improve again, they resort to doing more of the same thing, because they think addressing the symptoms will solve the problem.

That is The CX Reiteration Relapse – trying to address symptoms with more – More training. More systems. More people. More process refinement. More investment.

Typically this then means that questions are asked about the efficiency of the call centre operation and in turn about the ROI from the company’s investment in training and L&D.

It is no wonder then, that a recent CallCentre.co.uk blog evidenced that attrition rates are so high in the industry (and significantly higher than many other industries), and that a fifth of contact centres are actively seeking an alternative workforce management system in an attempt to resolve their challenges. The same blog highlights that 43% of contact centres also believe technology doesn’t meet their needs and an average 79% believe systems will fail to meet their future needs.

So how do call centres begin to think differently about their problem?

If issues with KPI’s and metrics are only symptoms, what actually are the root causes that are driving this perceived need for More?

1. Recall does not mean understanding – assessing the quantity of the training or measuring recall levels doesn’t help call centres provide great service. Staff may recall the facts when tested and appear highly capable, but unless they understand how and when to apply the knowledge in practice, will result in consistent errors and a perceived need for even more training

2. Confidence is often misplaced – typically 30% of people in organisations have misplaced confidence in their capability and understanding. These people drive risk into the business because although they think they are doing the right thing, they continuously make incorrect or misjudged decisions, and influence others in the process

3. More usually means less – more training often becomes less effective because those that have heard it before usually switch off, and therefore valuable training budgets are not used effectively or used to support specific needs

4. Infrastructure is often misaligned – the success of processes and systems wholly rely on the people who are tasked with implementing, managing and using them, and yet unless these are built with the current capability of the workforce in mind, they are likely to not have the desired results no matter how often they are refined.

So how do call centres address these root causes?

The component that is missing from existing call centre ‘solutions’ is evidence based People Insights.

This insight and evidence will provide call centres with a picture of what each person and team understands about the training they have been provided, the processes that are in place, their (likely and observed) behaviour and where the specific gaps are in understanding. Typically the 80/20 rule applies – 20% of your employees are already competent and confident and therefore do not require normal training, 50% of your people have very specific gaps in either knowledge or confidence and then 30% are over confident in their ability but continuously make the wrong decisions. Using evidenced based people insight is the only way of identifying and plugging these gaps.

Specifically that means call centres will be able to:

– Ensure and evidence that each individual actually understands how to and when to use the knowledge they have been given appropriately

– Align the appropriate learning and training resources to support each individual as and when they need it

– See and understand any emergent trends or issues that require early intervention, thus avoiding major and costly issues

Our advice to call centres is to rethink benchmarking data based on how many people have been through training and instead seek out data on who has understood it and how they are applying it. They will then be able to align their existing infrastructure as required, refining and building processes that link to the current capabilities and behaviours of the existing workforce, and deploy training only to those that need it for particular development. The approach will also evidence the effectiveness and ROI of those investments.

Addressing these root causes with people insight will dramatically help improve call centres internal and external KPI’s, improve their customer experience and reduce the risk of fines and untoward media and consumer attention.

 

Changing banking culture in 4 tangible steps

This past week five banks – HSBC, Royal Bank of Scotland, Swiss bank UBS and US banks JP Morgan Chase and Citibank – have been collectively fined £2bn by regulators in the UK and USA for traders’ attempts to manipulate foreign exchange rates. It is also expected Barclays will be fined in a separate investigation which is currently ongoing.

The UK’s Financial Conduct Authority (FCA) and US regulator, Commodity Futures Trading Commission (CFTC) issued the fines.

These fines come after a year-long investigation into claims that the foreign exchange market, where banks and other financial firms buy and sell currencies between one another, was being rigged.

Martin Wheatley from the FCA said the banks have “let down public trust” and “the individuals themselves will face consequences.”

 

It’s also been reported that several senior traders at the banks have been put on leave as the Serious Fraud Office prepares potential criminal charges against those behind the scheme.

This news comes after a long list of banking scandals and fines over the past couple of years. Perhaps what is shocking however, is that despite the uproar over the part banks played in the financial crisis and the fallout that has meant much closer scrutiny and governance –little seems to be stopping bankers behaving in similar risky ways as before the financial crisis.

 

An interview with former chancellor of the exchequer, MP Alistair Darling in 2011 by the BBC[i], three years after the financial crisis highlighted Mr Darling’s “absolute astonishment” he felt when he asked Britain’s largest banks to account for the risks contained in their businesses – and they were unable to come up with a coherent answer. The reporter hits the nail on the head when he says “this total lack of knowledge – couple with the hubris of profit-taking built on lax credit – went to the heart of the financial crisis.”

Banks seem to still remain in the dark as to where their People Risk and reputational risk lies.

There is a clear lack of transparency about how certain individuals behave or are likely to behave, seemingly allowing ‘rogue’ bankers to get away with partaking in activities which may be deemed acceptable by the long lasting banking culture, but are not correct nor morale and lead to mistakes ostensibly intentional or not.

This culture within banks is what is allowing such behaviour to continue to go unchecked and realistically, nothing will change unless the sector makes steps towards ridding itself of its so called ‘toxic culture’ of greed, excessive risk taking and bad decision making.

Moving forward

Steps can be made right now, the sector would benefit from having measures in place that provide them a level of visibility across their organisation and transparency of the exhibited behaviours and likely behaviours, the existing culture, the likeliness of individuals following process and whether a process itself is no longer correct.

Within the industry itself, there have been steps to improve banking standards and tighten up governance with increased regulation. The Banking Standards Review Council (BSRC) was also established this year and received the full backing of Mark Carney, governor of the Bank of England.

 

The BSRC aims to improve banking standards by identifying and encouraging good practice in learning, development and leadership, with a particular focus on behaviour and ethics. However with the global complexity of the banking sector this is expected to take years.

The FCA and PRA have also commissioned consultation papers for ‘accountability’ in banking, proposing senior managers must take further responsibility of their actions, but questions are being raised about how this can be implemented.

 

For things to change and for banks to win back consumer trust and repair damaged reputations all banks and bankers must first be open to change and make that clear. They must be determined to review and change their culture for the better and to gain a much better understanding of how their employees think, act and behave at work.

But first they must define for themselves what a better culture looks like, what behaviours they would like their staff to exhibit, what ‘correct’ process and procedure looks like and gaining buy-in across all levels of the organisation. What we don’t want to see now is banks becoming too risk averse, which we have seen in parts throughout the year, as risk plays a role in all business decisions and quite prominently in the banking industry, we need to establish a balance.

 

Steps banks can take right now:

1. Invest in a cultural survey which provides a ‘baseline’ of the current cultural norms and understand how individuals truly behave, conform to processes and understand their roles.

2. Review existing training, comms, processes to review if, how and where they match cultural aspirations.

3. Audit training and comms to understand why despite continual training, review, and refreshers, ‘it’s not sticking’, even if inroads to embedding a new culture have been identified and implemented.

4. Evaluate these findings and map interventions to each individual’s specific needs which help the senior management team and executives add a level of transparency and visibility around what their people know and understand and how they are likely to behave so they can PRE-EMPT problems such as this one arising in future.

 

Only with this knowledge and transparency will banks be able to make lasting changes to their working culture, find a balance between risk aversion and excessive risk taking and, become institutions we can be proud of.

 

[i] http://www.bbc.co.uk/news/business-29982178

Tesco ridiculed by worst crisis in its 95-year old history

Tesco was once the darling of the high street but now the 95-year old supermarket chain is facing its worse crisis ever as it admitted this week to inflating its accounts by £250 million. This wiped more than £2 billion off its market value, saw shares drop by 40% and put them at the bottom of the FTSE 100.

As a result, four senior executives have been suspended, including finance director, Carl Rogberg, with UK managing director Chris Bush also thought to be one of the four, whilst an investigation takes place into what has been going on. Questions will also be asked of former chief executive, Philip Clarke, and Laurie McIlwee, the chief financial officer who left last week.

 

 

Tesco said it discovered the overstatement of its figures, made as part of an August 29 profit warning, during its final preparations for its forthcoming interim results. It then announced that full-year trading profits could be as low as £2.4billion – some £400million lower than expected – after ‘challenging trading conditions’.

The supermarket has been losing ground since its first profit warning in 20 years back in January 2012, a year after Chief Executive, Sir Terry Leahy stepped down after 14 years in charge. During his time at the helm he saw a leap in pre-tax profits from £750 million on 1997 to £3.4 billion in April 2010. Philip Clarke took over from Sir Leahy, but stepped down from the board on 1st October 2014 after failing to turnaround the retail giant’s fortunes and was replaced by Unilever executive Dave Lewis.

 

Whilst an investigation will reveal what has been going on over the past few years, with questions answered and possibly charges brought against individuals if they have been found to have acted unlawfully, the reputational damage has already been done.

The trusted brand image Tesco has built up over almost 100-years is now being ridiculed. The papers have reported on the enormous number of tweets that people have made who are almost gleeful to see such a large retail brand brought to its knees.

 

This type of crisis is far more than a crisis of share price, company value and profits. Tesco is large enough to overcome these in the short term. Unfortunately, to many of their customers they will now be perceived as a supermarket brand that can’t be trusted. People vote with their feet and supermarkets such as Asda, Sainsbury’s, Aldi and Lidl are winning more and more customers, who are choosing them because of brand reputation.

Whether its budget brands such as with the likes of Aldi and Lidl, who have seen huge growth since the recession or a family-friendly brand like Sainsbury’s who trades on its quality food for great value image.

 

Customers are fickle and with so much competition in the supermarket sector, it’s going to be a tough job for Tesco to regain its position as top of the supermarket chains.

Tesco has needed to give its brand image a facelift for many years, but this latest crisis will make it a long hard slog to win back customers who have deserted them and get back the brand reputation they once had.