1. Opportunities to Improve Complaints Management Samantha Sheen, Senior Manager, Ernst & Young 16 August 2006 Risk Advisory Services e

2. e e 2 2 Overview of today’s presentation Introduction Changing landscape of complaints management Essential components of complaints management Opportunities for improvement - systems Opportunities for improvement - organisational culture Some case studies Concluding thoughts Introduction Changing landscape of complaints management Essential components of complaints management Opportunities for improvement - systems Opportunities for improvement - organisational culture Some case studies Concluding thoughts

3. e e 3 3 Complaints: A changing landscape “Expression of dissatisfaction made to an organisation, related to its products, or the complaints-handling process itself, where a response or resolution is explicitly or implicitly expected” ISO 10002 AS 4269 “Any expression of dissatisfaction with a product or service offered or provided” 13 key elements  5 key areas; planning, designing, operating, maintaining and improving  Explicit requirements with example templates Focuses on the concept of ensuring that the customer is more than merely heard  Suggests that the initial complaint include the desired remedy  Promotes continuous improvement and the concept of root cause analysis and audit Replaced in March 2006

4. e e 4 4 Transparent Process Essential components of complaints management Governance  Internal definition of a complaint  Complaint policy  Internal definition of a complaint  Complaint policy  Process for logging complaints  Staff training  Process for logging complaints  Staff training  Defined complaint process  Transparency and accessibility to customers  Defined complaint process  Transparency and accessibility to customers  Individual complaint resolution  Analysis of complaint causes  Individual complaint resolution  Analysis of complaint causes  Timely response to complainant  Follow up action  Timely response to complainant  Follow up action  Appropriate escalation  MI to management  Appropriate escalation  MI to management  De-briefing and close out  Continuous improvement  De-briefing and close out  Continuous improvement Recording Investigation Response / resolution Escalation / reporting Risk review Action planning & tracking Process improvement

5. e e 5 5 Complaint Satisfaction Interactions Outcomes Processes Apology Compensation Resolution Efficiency Convenience Flexibility Speed Duration Follow Up Accepting Responsibility Friendliness Honesty Attitude, Unbiased Listening Taken Seriously Clarity of Communication Customer satisfaction with complaints handling

6. e e 6 6 Role of Systems and Culture Organisational Culture  Staff empowerment and self efficacy  “Walking the Talk”  Tone at the Top  Encourage sharing of “bad news”  Help to foster long term behavioural changes  Cultivate voluntary accountability  Enhance and support CM systems CM Systems  Facilitate process improvements  Reduce risk of inconsistent treatment  Increased customer loyalty  Improved brand and service  Act as early warning signal regarding fulfilment of compliance obligations  Enhance and strengthen organisational culture.

7. e e 7 7 Case Study – Culture & Systems compromise process Issue: Super Switch Complaint: Service Quality RESULT:  Customer complains via customer hotline  Customer frustration levels escalated  Customer complains to others about service  Customer complains to ASIC  Regulatory action taken against company RESULT:  Customer complains via customer hotline  Customer frustration levels escalated  Customer complains to others about service  Customer complains to ASIC  Regulatory action taken against company

8. e e 8 8 Case Study – Culture & Systems compromise CM process Issue: Insurance Claim Complaint: Claim Process RESULT:  Customer complains to claims officer  Officer provides uncooperative response due to lack of authority to resolve complaint  Customer not advised of available DR process  Customer contacts senior claims manager  Customer complains to Insurance Ombudsman  Claim resolved 48 hours later  **** Missed originating source of complaint***** RESULT:  Customer complains to claims officer  Officer provides uncooperative response due to lack of authority to resolve complaint  Customer not advised of available DR process  Customer contacts senior claims manager  Customer complains to Insurance Ombudsman  Claim resolved 48 hours later  **** Missed originating source of complaint*****

9. e e 9 9 Case Study – Culture compromises CM process Issue: Financial Advice Complaint: Wrong Advice RESULT:  Customer complains directly to FA  Board frowns upon complaints  FA speaks with customer; provides reassurance  FA perceives matter is resolved = NOT A COMPLAINT  Customer desists from further activity with FA, company or product provider  Company celebrates its “low” number of complaints RESULT:  Customer complains directly to FA  Board frowns upon complaints  FA speaks with customer; provides reassurance  FA perceives matter is resolved = NOT A COMPLAINT  Customer desists from further activity with FA, company or product provider  Company celebrates its “low” number of complaints

10. e e 10 Concluding Thoughts – “It’s about your people” All levels of management “walk the talk” Open communication (Want to hear the bad news) Focus on positive benefits of complaints for the company and employees Monitor for “compensating feedback” and risks of cultural misalignment Training on policy & procedures vs behaviours and conflict management Senior management seen as (and are) receptive to escalation of complaints as much as other business priorities (Tone from the top) All levels of management “walk the talk” Open communication (Want to hear the bad news) Focus on positive benefits of complaints for the company and employees Monitor for “compensating feedback” and risks of cultural misalignment Training on policy & procedures vs behaviours and conflict management Senior management seen as (and are) receptive to escalation of complaints as much as other business priorities (Tone from the top)

11. e e 11 Conclusion Samantha Sheen, Senior Manager Risk Advisory Services Compliance Advisory Team E-mail:samantha.sheen@au.ey.com Any Questions?

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