In light of ever-changing customer needs and expectations, firms are constantly evolving TCF practices. Customer service specialist Derek Bishop explains how businesses can live up to TCF regulations.
One of the risks that firms may have taken in ensuring that they hit last year's Treating Customers Fairly (TCF) deadlines was in trying to take existing management information and finding ways of making if fit with the TCF outcomes. The problem with ‘Shoehorning' existing management information to fit an alternative purpose is that while it may have highlighted some of the critical gaps, it may not be until further down the line when the gaps in the evidence gathering start to emerge.
In order to meet FSA requirements, it is critical that any TCF procedures are fit for purpose and, even though a firm may have implemented Management Information, it is still worthwhile validating that they are fit for purpose and totally embedded into the business. Firms need to take a fresh view by identifying what management information is needed to demonstrate adherence with TCF outcomes, and then work backwards to develop a process designed specifically to capture this. By starting with the end in mind, firms can identify gaps and this will minimise the risk of incomplete evidence. Those firms planning on launching new propositions to market should look to set robust management information requirements from the outset.
The current economic climate drives the need for even sharper Management Information to enable faster and better decision making. With customer behaviour changing so rapidly, it is critical that firms are able to use their Customer Relationship Management (CRM) systems to provide quick and accurate insight into these changing behaviours to enable them to quickly change, adapt and respond. Now, more than ever, is a prime time to revisit what Management Information is delivered through CRM systems and ensure it is totally aligned with business needs so they can then cater to all TCF requirements and more importantly, enable firms to keep pace with changing customer demands.
Customer centric culture
Would your staff say you have a TCF culture? And if so, is this really what you want? Or, do you really want a customer centric based culture which fulfils the requirements of the TCF outcomes but is not its primary focal point? Customer service is not just about adhering to regulatory requirements; it is about an overall philosophy. TCF within a firm should be expressed in the context of the desired customer experience. You will achieve TCF through delivering service excellence for the customer - if you can achieve this, this will deliver significantly more value than just adherence to regulatory requirements.
Now more than ever, it is vital to truly understand what is driving customers' actions, e.g. the real reason they are contacting you with requests or queries. With customer behaviour being driven so quickly by changing situations on daily and weekly bases from the events in the global economy, it is fundamental to really understand what is behind them. By truly understanding this, advisers will gain huge insight which will enable them to deliver superior service as well as fulfilling TCF aims.
At the same time, the changing dynamics of the customer base will demand a different style of interaction - with the rapidly growing number of social media savvy customers, it will be critical to engage in this style of customer interaction, both from a sales and a service perspective. According to market analyst Nielsen's latest research, 66.8% of internet users have used social networks, while only 65.1% have used email.
Social media is moving beyond offerings like Facebook and into new forms such as Twitter. For those unfamiliar with Twitter, it involves short messages of no more than 140 words which are then published to those who ‘opt in' to receive your updates, thus enabling you to build stronger relationships with a community of followers. Twitter can be used at multiple levels - one is about giving by posting regular useful guidance e.g hints, tips or headline news, or can be used to keep your customers updated e.g. In the news last year, Newcastle City Council was classed as one of the first local authorities to have used Twitter to report by-election results. Additionally, during the heavy snow this winter, the same council posted information about school closures. By doing so, they were able to reduce website enquiries and inbound calls, increase customer satisfaction and improve service to their customers. How could an IFA utilise this tool for the benefit of customers and the business?
So what has this got to do with TCF? Take a look at ‘Outcome 3: Consumers are provided with clear information and are kept appropriately informed before, during and after the point of sale.' What has been deemed as ‘appropriate' in the past will change in the future, so developing and implementing a social media strategy for engaging with actual and potential customers is key. Many early adopting firms have already done so.
Facebook and Twitter
However, Social Media provides an opportunity to engage with the customers in a way that can provide information to businesses and customers that can build strong synergies OR break the relationship. Firms need to think about the opportunities and risks that tools like Facebook and Twitter present and how they can maximise these tools for the benefit of the staff and customers. Those that will succeed in the current climate are those who understand the power of social media and embrace it to build deeper, more meaningful relationships, for little outlay.
It is easy to underestimate the importance of effective two-way communication and get drawn into solely focusing on delivering hard results. Sustainable results can only be achieved through actively engaging people, and, in doing so, using a variety of different methods suited to your different audiences - customers, potential customers, staff etc.
Social Media can also be used as a great research tool, gaining valuable insight from customers and potential customers - ‘Outcome 2: Products and services marketed and sold in the retail market are designed to meet the needs of identified consumer groups and are targeted accordingly.' So, think about how Social Media can help your firm, and fulfil the TCF outcomes.
One of the most important aspects in embedding TCF throughout the firm is achieving sustainability - it must be a ‘way of life' and ‘business as usual' - as TCF cannot be treated as the latest initiative that will fade away.
In order to meet the required standards, firms must be able to demonstrate over a sustained period of time that they are still delivering against the outcomes and this can only be achieved through total adoption throughout the entire organisational chain and by analysing each aspect of the customer experience from start to finish. Regular reviews, challenges and improvements will need to become the norm so that the firm evolves under a culture of TCF practices - it is not just a question of ticking the box now and when the job is done.
Firms should develop and implement their own self-audit and review programme, ensuring the outcomes from the review are discussed by the management team and both actions plus timetables are agreed to ensure the gaps are closed. Bear in mind that evidence is required of achievement of each outcome, so even though a firm may be satisfied that it fulfils the requirements, companies will need to be able to demonstrate this easily to the FSA.
Derek Bishop is director at Abeo Consulting (www.abeoconsulting.co.uk)
