Complaint Handling Within the Retail Market of UK - Article Example

Importance of Complaint Handling Within the Retail Market of UK and Significance of the Contract Law Introduction The article deals with the importance of the complaint handling within the financial services of United Kingdom. The article will first state the general importance of handling the complaint, and then few problems within the financial services of United Kingdom market are shown with different solution. In the last the importance of these complaints handling with statistical data is shown ending with significances of contract law. Importance of Complaint Handling The customer handling is the key factor that helps in organization in gaining the loyal customers. The customer handling helps you in increasing the retention rates of the customers. Their loyalty with your company can enhance your sales and helps in increasing your yearly turnover. These complaints inform the organization what actually the customers wants, their needs and what changes they want. The importance of these points and ideas from the customers are very important due to the reason that you are actually serving these people. So these are the customer voice that meant a lot for the organization. These customer voices are actually what they really want in the product or services. The after sale service is important because customers may feel some problems and dealing with problems may help in gaining their loyalty. These customers handling isn’t important for the sales and marketing of the product but also important for the service providing companies. This article is actually based on importance of complaint handling within the retail FS UK market. We will see what problems they were facing and how the problem solving enhances their service market. Some critical issues of the financial market of UK In 2003 the life insurance company based in UK paid the fine of 675,000 pounds due to their mortgage endowment complaints which were not handled properly. Similarly in 2004, Life Insurance Company again paid the fine of 725,000 due to their bad handling of mortgage endowment complaints. The reason was that the company was unable to provide better services before and after the sale of their services. In 2005, high street bank paid the fine of 800,000 pounds due to their bad customer services provided to their customers. In 2006, again the life insurance company paid the fine of 750,000. In 2007, IFA paid 330,000 of pounds as fine again due to their bad customer handling. These all fines paid by the companies are the only reason of bad customer services they provide to the customers. These companies then need to take a deep look inside their customer relation services in order to know that where the actual problem lies. What actually causes these problems in the company? We try to search and find some issues which these companies lack and these were… The company was fail to give sufficient customer services as customer advisors were failed to advise the customer the which service suit them most. These companies were unable to provide importance to the customer when they first step in the company. The companies were unable to investigate deeply in order to know that where the company lacks mostly so that they can enhance that section. The companies were unable to launch such systems and strategies that can improve the customer relations with their employee’s. The companies were unable to provide awareness to the customers that what they actually hold for them. The customers are unable to know their whole procedure. They were unable to know that how long the company will deal, what will be their process, what will be their after sale services, and what actual product or service of the company will suit them better. Similarly the company was unable to provide such services like complaint handling and resolution. First of all the company was unable to handle the complaints properly. The company’s staff was not trained and unable to handle customers with their complaint. Secondly these complaints were not passed to the top management due to their bad communication level. And most of all, the company has no resolution strategy that can handle and solve these customer problems. All these together causes the quitting of customers from the company and thus each year the company faces a huge fine that was paid by the company. Looking at these problems, their rise the importance of customer handling within the organization. First of all we will look that how these problems were solved and then we will see the importance of these handling by the effect they causes on the company. Training and awareness is produced in the lower level staff that enhances them that how they have to deal with the customers and how pass these problems to top management. This awareness enhances the dealing level of staff that pleases the customers. Empowerment was the first strategy that was launched by the company which enables the bottom line staff to direct deal with the problems of these customers and handles themselves. This technique requires the problem solving skills and decision making power in the employee. For this, the sufficient training and presentation helps the company in order to provide these skills in the customers. The empowerment not only motivates your employees but also provides the satisfaction level to them. This satisfaction directly satisfies your customers and thus you can easily win their loyalty. Invest in training and development programs help a lot for the company. This training and development may cause an initial cost to the company but the productivity level they will produce in future not only overcome that cost but also increases the over all turnover of the company in the end. Remuneration with showing the best career path to the employees will be the best strategy. If you want to enhance the quality service, the remuneration packages for the employees when they provide quality for the company will enhance the overall company’s operation. The salary packages and bonuses with promotion can cause the job satisfaction for the company that it self satisfied the customers. Clearly defining the process of handling the problems, communicating them to the top management is taught to the staff. How these complaints should be handled is taught to these lower staff members. Then the strategy or system of continuous analysis should be launched by the company to know the root cause of the problems in the vertical hierarchy of the company. Similarly the company should launch the tool for the quality assurance in order to provide the continuous quality at each step. The risk for failure must be noted at each step. When all these precautionary measures are taken by the company then the company can better handle with their customers for whom they are serving for. IMPORTANCE OF COMPLAINT HANDLING WITHIN THE RETAIL FS UK MARKET The importance of these customers handling is very essential for almost all types of organizations. But in the case of Services Company which basically serves the people need essential steps in order to capture the market. Let now look at these importance’s that can cause a great success for the company. These customer complaints handling is very important as this may cause in gaining the customer loyalty. This customer loyalty helps in increasing the rate of retention of the customers. The more the customer loyal, more they will remain with you and thus increases your overall turnover of the company. These retention rates help the company in gaining the long term objectives of the company. When company knows that maximum of market is attracted by them then they are able to launch their other new programs. The other most important factor is that it helps in reducing the extra cost and wastages of the company. When your employees are skilled and know how they have to deal with customers and how to solve their problems then few problems will rise and it helps in reducing different other extra costs of the organization. it is seen that in many UK financial services, after launching the better complaint handling services their more then 10,000 pound extra cost was reduced to 0 pound. The better you handle your customer, making them satisfy, lower will be your extra costs that are applied when you are unable to handle these complaints. When you handle these complaints then you come to know that what actually the customer wants from you. These complaints hold all these information that what changes in the services and what new scheme the customers want. You are actually serving these customers and their complaints are actually their voice. And if you will not hear their voice then you will be unable to attract your customers. Therefore, these complaints are very important in order to provide information on daily basis that what the customer actually want in your services. These complaints are very important because you can predict about your company and its future. If you are getting more complaints from the customers then you can predict that the company needs a deep analysis of each process and need to know that which step and process should be enhanced. On the other hand if the company gains few or no complaints then it shows that the customers are satisfied with your. At this stage you can launch your further new strategies and schemes in order to diversify your organization. Therefore, these complaints maters a lot in both of cases. But what actually is needed is to handle them properly. When you handle them properly you are not even satisfying your customers but also you can easily communicated by those changes and wants that the customer need. The financial service sector of UK based companies start handling the complaints in better form and launches different strategies. The result of these was that these companies increase their sales from $753 billion to $1359 billion from 2004 to 2007. Premium income of the insurance companies in UK increases to 16%. Whereas the income of banking sector in UK increases to 16%, within 8 months in 2007. These totals were calculated as 7271 billion pounds. Therefore the importance of handling complaint isn’t shown theoretically but also shows some statistical information that actually shows the importance of handling these complaints. SIGNIFICANCE OF CONTRACT LAW Contract law is very important as it can easily manage the dealing within the company and its customers. Usually this contract law holds some rules and regulations that help the management department of the company. The customers once agreed with these rules and regulation he can not cross these rules. This contract law means the meeting of mind of different people, which simply an agreement showing that both the parties are agreed on given laws and rules. The significance of these contract laws is shown in the financial service market of United Kingdom. These significant are shown as The contract law helps in managing the whole process of the organization. It manages the relations within the organization and the customers. The customers and organizations know that what rules they have to fulfill and what obligations they have to pay in order to fulfill these rules. These contract laws thus make a systematic system keeping all the work on the track. These laws help the organizations to know that they have to fulfill these rules and their services that they have contracted with their customers. The contract law really helps in the services market especially in the case of United Kingdom. This contract law solves different conflicts not among different customers and organization but also between organization and its employees. These laws are important in service departments like bank and insurance company as it helps in settling the both teams on same agreement. These settlements help in maintaining the future relationship. The contract law in the banking sector helps as it keeps the customer and bank tight in an agreement and neither of them can violate these rules. This helps to maintain the long term relations in the future. The relationship management emphasis on the contract law in order to maintain and sustain the better relations. These contracts outline the organization that which responsibilities they have to fulfill in the future for their customers. Other then these contract works more efficiently in insurance companies, where their longer relations are only maintain by these contracts within the company and customers. Contract law is the key for maintaining the long term relations with customer and helps in managing and maintaining the relations. Allen. P. & Wootten. G., 1998. Selling. 5th ed. Pitman Publishing Broadhurst. P., Williams. V. A. & Horsted. J., 1996. Law & Practice for Mortgage Lenders. Financial World Publishing. UK. Jobber. D., 1997. CIM Handbook of Selling & Sales Strategy. Butterworth Heinmann Payne.A.,ed.1995. Relationship Marketing for Competitive Advantage. Butterworth Heinemann. Peck et al 1999. Relationship Marketing: Strategy and Implementation.  Oxford: CIM/Butterworth Heinemann Gary Dessler (2003) “Human Resource Management” Ninth Edition Read More