TCF: Lifeblood of delivery!

Treating customers fairly (TCF) reinforces the belief and reality in the fact that our industry is service intense. It is all about delivery and not just distribution. Stephen Rosling, Co-founder & Director of UK based  TCF Matters candidly answers some very critical questions:

 Q: Is TCF indeed about MOT (moment of truth)?

A: This is a complex area Praveen and one that provokes a lot of debate and confusion. My understanding of this term is that it represents those key moments, (can also be known as “voting points”) in the customer journey when the customer expects the provider to keep their service and/or product promises. For example:

 When the policy documents arrive, do they represent the product that was sold to me?

 When I make a claim, does the product perform as I expect it to?

As such, they clearly affect the customer experience and their level of satisfaction. One thing is clear however, treating customers fairly is not about creating a great customer experiences or creating satisfied customers. (Rejecting an invalid claim is perfectly acceptable, but will clearly have a negative effect on customer satisfaction).

In my experience, the topics of TCF, MOT’s, Customer Experience and Customer Satisfaction can be easily confused and, unfortunately, many organisations have focused on customer satisfaction at the expense of treating them fairly – particularly in the sales processes.

Q: How does one ensure TCF is embedded uniformly across the entire delivery continuum?

A: TCF needs to be applied across all these continuums: product value chain, customer journey(s), and the employee journey. These clearly overlap in some areas and collectively come under the umbrella heading of organisational culture.

As such, you need to look at the following cultural elements: leadership, strategy, decision-making, controls, recruitment, training, and reward.

I’m not sure I can answer the more practical elements of “how” in a few words – as TCF affects the “DNA” of every part of the organisation, it would be very difficult to distil this beyond the process and governance areas I referred to in my presentation.

Q: How much is TCF qualitative and how much is it quantitative in terms of implementation?

A: Another great question Praveen! You need to get this balance right and only you will know what this look like. If we assume that qualitative and quantitative relates to being able to measure the fair treatment of customers, then you certainly need “words” to bring the “numbers” to life. You also need a mix of internal and external data – it would be unwise to rely purely on internal data.

As a principle, you certainly need to be wary of TCF becoming a “tick box” exercise, or being managed as simply another project. I believe this is where some UK and US organisations went wrong.

Q: How does one reinforce it top-down (role-modeled rather than imposed)? Is it about walking the talk?

A: This is about identifying the right sort to TCF behaviours/competencies and then encouraging all staff to act in a way that’s consistent with these behaviours. Organisational leaders can set the cultural tone by visibly demonstrating these behaviours and rewarding those around them who also demonstrate the right behaviours. What you need here is a combination of objectives, job descriptions, competencies, and reward mechanisms that are all aligned to TCF. Depending on the current culture of the organisation, there may need to an element of imposition.

Q: How do you bring consistency between various entities that create a uniquely individual experience for each/ every stakeholder?

A: Another great question Praveen and one where I don’t think there is a simple answer. I think I would start with an organisational vision that everyone can buy into, support and see how they can contribute to the vision – a “line of sight” between what an individual does on a day-to-day basis and the vision of the organisation. Regular reinforcement of progress towards the vision should also keep people on track. I think there’s also something here about having the right people in the organisation, (whatever they do), who have an absolute clear standalone top priority on the customer – with everything else secondary.

(This is a big question Praveen and I’m not sure I’ve done it justice!)

Q: How important is an employee of a practising organisation? Is he or she a customer too?

A: Collectively, the employees and their behaviours toward internal and external customers, make up the culture of the organisation. So whilst the TCF principles very clearly state the customer is the person who buys the product, employees must also treat other in a manner that’s consistent with TCF. Getting teams to create their own TCF Charter is an effective way of achieving this.

Q: Can there be shades of fairness, thereby issues relating to consistency/ inconsistency?

A: Fairness by its very nature is not black or white, but this does not mean it will result in inconsistencies. There are 2 key principles to ensuring consistency when it comes to issues of fairness – get as many perspectives as possible and make sure you identify all customers in the same situation.

Q: How do you bring a balance between subjectivity and objectivity in this space?

A: This is all about getting as many perspectives as possible on a given situation – externally this might include the shareholder view and would definitely include the customer. Internally, this might include sales, marketing, operations, risk etc.

Q: How do you audit & ascertain the degree to which an organisation treats its customers fairly?

A: This is what I do Praveen! If you need a regulatory and cultural assessment of the organisation. I’d be happy to discuss this if you’re interested in exploring this further.

Q: How important is TCF for the emerging markets? Can they avoid some of the pit-falls in development of financial services architecture by learning from mature markets?

A: I think TCF regulations are becoming increasingly prevalent and important in all markets – not just in emerging markets. There were a couple of slides in my presentation that focused on this and certainly recent reports by some of the big auditing firms support this view.

The IMF recently recommended to the Malaysian regulators that their effectiveness could be enhanced with strengthened enforcement tools and the development of a supervisory framework specific to market conduct activities. In developed markets such as the UK, we now have a new regulatory authority, which is expected to be far more visible and rigorous in its investigation and enforcement of TCF principles.

As far as lessons are concerned, I think there are plenty to be learned and I touch on these in my article published in the January issue of Asia Insurance Review.