How to improve your relationship with the Financial Ombudsman Service
Let's be honest. No one likes the feeling of not being in control.
For any business, the thought of seeing your customers exercising a right to speak to an independent, publically funded organisation can be particularly terrifying.
When customers choose to refer a complaint to the Financial Ombudsman Service (FOS) it can be too easy for a business to sense a total loss of control. It’s too easy to feel that the customer is simply elongating the complaint lifecycle in the hope for a payout.
It's no surprise therefore that some organisations have perhaps, at times, had an uneasy relationship with the FOS and the decisions it makes. It is possible – and arguably, absolutely critical, that a business puts an appropriate internal framework in place to positively drive its entire relationship with the FOS. When this is done effectively, it becomes hugely beneficial to your customers, your business (and to FOS).
The challenge: “The ability of an organisation to understand FOS casework is critical in demonstrating robust governance around whether the internal complaint handling policy is delivering fair outcomes for customers”
1. It all starts with the initial file request.
Understanding which complaints are being referred in the first place. It sounds so simple right? And yet, it’s staggering how many times this isn’t being recorded (and whether this is being recorded effectively. Pause for thought – how do you categorise this data?)
In the same way a business will always keep an eye on incoming complaints, you must track weekly run rates by meaningful cohorts. (Pause for thought – can a spike in complaints be easily explained by a policy change a few months prior?) Your complaint handling process (and the customer experience) is all connected and if you have the right data feed, it can almost always be explained.
Don’t underestimate the power of your case submissions. The business carries the “burden of proof” so guess what? A post-it note with a covering memo might not be the best way to support your complaint handler’s decision.
2. Understand your FOS stock.
Sounds straightforward right? Understanding how many cases you have at the FOS is a start. But you have an opportunity to do so much more. Remember, this is all about how you build a more effective relationship with the FOS. Build a system that allows you to identify opportunities to define your FOS stock into cohorts. Allowing FOS to individually adjudicate in each individual case is certainly one way to go, but it’s not the only way.
By effectively understanding what you have at FOS, it allows you to more accurately predict the future change rates and stay ahead of the narrative.
An extremely useful piece of M.I to have in your back pocket to prevent any nasty surprises!
3. Engaging with the process of Adjudication.
It’s not all bad. And this is an opportunity to understand where you align with FOS, not only where you differ. (Remember those long afternoons debating with your Policy Team, well those 'dye-test' cases on particular watershed issues can be tracked through to the FOS stage providing your business with a FOS adjudication validation......)
Complaint categorisation is hugely important here as those change rates become valuable and intelligible root cause analysis that needs to be plugged back into your complaint handling policies.
Managing this part effectively affords your business relevant opportunities to align or strategically challenge adjudications by categorisation (Pause for thought – how meaningful is your data? If you can't use it, you might not be recording it effectively....... anyone noticing the reoccurring theme here...?)
4. Going to the Ombudsman stage?
By implementing stages 1, 2 and 3 effectively, your business should be very well informed about which cases (by categorisation) you are deciding to allow through for an Ombudsman decision. Regardless, of the outcome it must be recorded and either changes your Complaint Handling policy or informs your FOS process.
That insight has to go somewhere....
An organisation that is able to build this framework effectively achieves an enduring capability to:
• Understand why customers are taking complaints to the Financial Ombudsman Service in the first place
• Actively monitors (and is able to predict) trends in the FOS run rate
• Respond to FOS file requests in a timely manner with considered submissions
• Undertake a re-review of the key components of the case to determine whether your business has followed its own internal policy
• Maintain a clear ‘line of sight’ into the FOS stock. Demonstrating that your business understands – at all times – what is with the Ombudsman Service; so that it can consider and predict the impact of any future Policy change on that stock
• Track and record adjudications received from the Financial Ombudsman Service to understand high-level trends in policy misalignment
Once the above has been achieved it provides the organisation with the platform to:
• Offer alternative solutions to reduce the FOS stock
• Understand whether the firms file submission can be improved
• Refine internal policy where required to align with FOS
• Provide your business with far greater insight as opposed to simply monitoring historic change rates
• Develop a strategy for challenging FOS views post adjudication (where appropriate)
• Build a key operational skill which evidences a culture of improving customer outcomes
One thing is for certain, if you take a strategic approach to working with FOS, it will greatly benefit your customers, your business and the Ombudsman Service. Resolving complaints along the fullness of the complaint lifecycle is hugely important to improving customer outcomes and protecting the reputation of your business. Plus, if you can improve the effectiveness of your relationship with FOS along the way, then why not do it?
Sam Tattersall has actively worked on projects within the Financial Ombudsman Service and has subsequently helped businesses improve their complaint handling processes to help improve its effectiveness and reputation.
Contact samtattersall@sygnia-group.com for more information on how SYGNIA can help improve the strategic and practical organisation of your complaint lifecycle.
www.sygnia-group.com