Are you using root cause analysis in complaints?

Taking hold of complaints is an Energy Supplier’s hidden gem of opportunity for improving their financial position.

The journey for Complaints in a Supplier starts with their definition of satisfaction. We can infer the type of definition a Supplier has adopted by looking at league table performance - the Citizen’s Advice Bureau (CAB), published each quarter. 

A high first contact resolution implies a Supplier recognises dissatisfaction immediately. The measure shows they log everything and close a lot because the complaints are ‘easier’ to resolve. By contrast, Suppliers that have a low next day resolution implies they focus on logging more complex customer complaints. The measure demonstrates that low, and slow resolutions are due to the complexity required to resolve. 

With reporting of CAB scores being public, Suppliers often shift focus to what tactical interventions can be adopted to alter their standing in the league tables (and there are many different tactics).

The danger with focussing on league table improvements is that the cost of complaints remains high and potentially increases exponentially as root causes are not understood. Although not immediately visible the knock-on impact of not addressing root causes can have detrimental impacts across the wider business. To name a few:

·        Propensity modelling

·        Sales strategy

·        Customer Lifetime value

·        Resource modelling

·        Propensity to get into debt

In the energy world, complaints are the most valuable source of real customer data which poses the question:

Why is complaints data not at the heart of business operating decision making?

Based on the latest Citizens Advice Bureau results around ~11 % of customers are complaining in a quarter. What’s even more interesting is that this number isn’t decreasing quarter on quarter, let alone year on year. 

Suppliers are being told exactly what is wrong in the way that they’re operating by customers - yet the same complaints exist! The data could be excused if customers were only complaining about price, but they’re not. The biggest complaint categories are still centred on Customer Service, Billing and Metering.

What are Suppliers missing out on?

Root cause is a phrase that’s becoming more and more common as the cost of implementing sticking plasters and work arounds that result in continued failure demand becomes more apparent. Ofgem are also showing a much greater interest in root causes as Suppliers are seeing the same failures in their operations repeatedly. 

Ofgem have recently opened a ‘compliance case’ into Scottish Power’s complaints procedures expressing concerns about the handling and resolving of critical issues. Most importantly their focus is on calling out the diagnosis of root cause problems and the impact of not doing this is starting to have on customers. 

This means we could start to see less focus on the complaints handling process and standing in leader boards and instead an expectation for Suppliers to evidence how they are utilising complaints data to identify root causes and inform business wide programmes of activity.

At BFY, we are leading energy retail advisors and have a breadth of experience tackling a multitude of problems that face Energy Suppliers from our complaint’s diagnostic, Debt Management Programmes, Sales Strategy Programmes and in year Cash Generation Programmes.

We have adapted traditional lean and DMAIC improvement methodology to offer bespoke problem solving approaches to match our client’s needs. Our tried and tested Complaints Analysis and Recovery Programme is evidence of this.

To learn more about how our Complaints Analysis and Recovery Programme can support you, or for more information on the topics in this article contact Rebekah Galligan, [email protected]