15 Banking Complaints Every Minute and Rising. Is There an Answer?

Earlier this week news broke that for the 4^th period in a row, complaints made to UK banks were on the rise. In the most recent 6-Month period the number of customer complaints reached a staggering 4.2 million – that’s equivalent to 15 recorded complaints every minute, of every single day. To compound matters further, the rate of closure slipped from 39% being settled within 3 working days down to just 35%.

Representatives of the industry reported that an increase in PPI claims were, in a large part, responsible. Not least because the deadline for claims is fast approaching.  However, once PPI claims were stripped out of these recent figures, the underlying trend remained firmly on an upward trajectory. Hardly good news for the industry.



Perhaps, therefore, it is no surprise that the FCA (Financial Conduct Authority), the regulator for almost 60 thousand financial services firms, is repeatedly encouraging the sector to adopt ‘as robust a process as possible’ to uncover and address the root causes of their problems, and avoid getting locked into treating just the symptoms, painful as they undoubtedly are.

Most recently Christopher Woolard, Executive Director of Strategy and Competition at the FCA, said: "Firms need to be doing all that they can to reduce complaints.  It is clear that firms need to look at the cause of the rise in complaints and address these issues to prevent further increases. It should be a priority for firms to ensure good consumer outcomes are achieved and they should be making sure that they are taking the right steps to treat customers fairly.”

This message has not fallen on deaf ears and over the past decade there certainly has been an increase in awareness of Root Cause Analysis within financial services.  However, it is clear from the FCA and from our work in the sector that a lack of detailed knowledge around the concept remains an issue.
 
Therefore, uncertainty as to what constitutes effective Root Cause Analysis and how to best implement it within the finance sector is common.  This means that although most major banks utilise some form of RCA to address their complex and recurrent problems, the gap between those who execute it well and those who do not is enormous. The result is ever poorer customer outcomes (see above) coupled with growing frustrations from within the industry that stakeholder expectations cannot, and will not, be met.
 
So, what exactly is an ‘effective RCA’ and what does it deliver?
 
At its core, effective RCA is a process for identifying the multiple root causes of problems or events in order to prevent them from recurring. It is based on the premise that genuine problem management requires more than quickly putting out fires, it requires a systemic way to prevent them. 
 
When an RCA method, specifically-tailored towards financial services, is implemented, solutions migrate from the short-term and reactive (fire-fighting) and become structural, proactive and transferable across multiple departments.  Creating a first-class Root Cause Analysis program is undoubtedly an investment but like all sound investments it provides multiple returns, delivering benefits over the longer term. 
 
Sologic are the leading provider of root cause analysis skills to the financial services industry, with training courses, software and consultancy all tailored to the specific needs of the finance sector. 
 
If you would like to know more about Sologic’s Root Cause Analysis training, software and services please email Europe@sologic.com or call +44 (0)1603 819130.