Improving the customer experience in regulated markets

12th Feb 2018

Portcullis House, Houses of Parliament, London SW1A 0AA

In attendance:

• Philip Davies MP, Chair
• Chris Evans MP, Co-Chair
• John Penrose MP (Con)
• Melanie Onn MP (Lab), Shadow Housing Minister
• Patricia Gibson MP (SNP), Spokesperson for Consumer Affairs
• Gill Furniss MP (Lab), Shadow Minister for Steel, Postal Affairs and Consumer Protection
• Angela Smith MP (Lab)
• Matt Western MP (Lab)
• Chris Stephens MP (SNP)
• Lord Fox (Lib Dem), Spokesman for Business, Energy and Industry Strategy 
• Baroness Jones of Whitchurch (Lab), Shadow Minister for the Environment 
• Baroness Burt (Lib Dem) 
• John Russell, Senior Director, Strategy & Planning, Ofwat
• Lindsey Fussell, Consumer Group Director, Ofcom 
• Meghna Tewari, Head of Retail Market Policy, Ofgem
• Will Knight, Economic Advisor for Consumer & Competition Policy, Department for Business, Energy & Industrial Strategy 
• Adam Capstick, Ofcom
• Mary Davies-Colley, Ofcom
• Graham Dunn, Senior Government Affairs Manager, Vodafone
• Dannii Leivers, Senior Associate for Strategy & Policy, Ofwat
• Sue Lindsey, Director of Customer Policy & Engagement, Wessex Water
• Jo Mayes, Director of Customer Operations, Business Stream
• Dr Huw Parry, South West Water
• Richard Wainer, Head of Public Affairs, EE
• Ben Bax, Customer Service Director, Kier Services Utilities 
• Kathryn Oakley, Office of Sheryll Murray MP
• Kate Macpherson, Office of Caroline Flint MP
• Jo Causon, Chief Executive, Institute of Customer Service
• Mike Petrook, Director of Communications & Corporate Affairs, Institute of Customer Service

Contributions from invited speakers during the session

Chris Evans MP opened the meeting by welcoming guests and thanking everyone for attending.

Jo Causon, Chief Executive of The Institute of Customer Service:
• Jo welcomed guests, and thanked Chris Evans MP for chairing the meeting.
• Institute of Customer Service data shows a direct correlation between customer service and customer satisfaction, that holds over a one, three and eight year period.
• Organisations and regulators cannot be complacent. The UK Customer Service Index is the largest dataset of its kind, and the latest release shows more organisations have fallen in terms of customer satisfaction than risen over the last year. The amount of effort that customers are having to put into the relationship is also increasing
• Jo also talked about the changing priorities of customers and the need to have a consistent set of standards in which to benchmark organisations both within and outside of sector

Meghna Tewari, Head of Retail Market Policy, Ofgem:
• The energy sector has seen customer service improvements, but it must be acknowledged that there is still room for improvement. 
• There is a cross-sector element to customer service and the forthcoming consumer and markets green paper should reflect this, be future looking and set out a more innovative approach.
• The green paper is overdue, and it should seek to engage with third parties as well as regulators and providers.

John Russell, Senior Director of Strategy and Planning, Ofwat:
• The collection of customer service statistics has improved in the water industry, and performance is improving over time.
• More customers are being surveyed – for the first time, not just those consumers who make formal complaints.
• Developers are also being surveyed now as well, which is important as the delivery of water services is linked to increasing the provision of housing.
• There has been a strong emphasis on how companies should be ‘owning’ the customer experience. Financial penalties serve to reinforce this, as do financial rewards (for very exceptional performance).
• Issues of trust remain, and consumers need to be able to have confidence in providers.

Lindsey Fussell, Consumer Group Director, Ofcom:
• The telecoms market has and is changing rapidly, perhaps more so than any other sector.
• The Digital Economy Act has given Ofcom more powers, and that reduces the green paper in terms of its relevance to Ofcom and the sector.
• Significant investments have been made in networks, and customers see network speed as a fundamental part of customer service.
• However there is a high degree of choices between providers and packages, and this can lead to confusion for consumers.
• Regulators are important, but they are not the only actors.

General discussion

John Penrose MP asked about how regulators could work together more, and whether there needed to be a single regulator across sectors.

Angela Smith MP asked about how regulators balance the needs of individuals versus providers. She stated that customers have a clear and broad view of what good service is, and it includes concerns about data speeds and leakages in the water system.

John Russell said that rather than there being a single regulator, there should be legislative consistency across sectors. Ofwat recognises it has a wider societal role – for example in ensuring public health.

Meghna Tewari said that the pace of technological change is a challenge for all regulators, and that tech will always move faster than regulation. She said there are examples of effective working across sector, in particular in relation to vulnerable customers.

Jo Causon said that the UK Customer Service Index (UKCSI) has been able to consistently measure customer service performance across different sectors for ten years now. Different regulators should be able to capture comparable data across their sectors, by using the same metrics.

The UKCSI uses over 30 metrics of customer experience, reflecting the priorities customers themselves have identified as most important. Broadly, the UKCSI covers staff professionalism; quality and efficiency; ease of doing business; timeliness; problem solving; complaint handling; and attitudes towards trust and reputation.

Lord Fox said it was important to recognise that call centres are a critical customer service interface. He asked whether it was known what attributes more successful sectors have.

Jo Causon said there were good performers and laggards across all sectors, but the attributes that distinguish good customer service are businesses that do not treat customer service as transactional, that reward good service, and that align people, processes and delivery.

Baroness Jones declared her interest as Non-Executive Board Member of Ombudsman Services. She spoke about the positive role alternative dispute resolution (ADR) can play, and suggested the Government may have “missed a trick” in how it has implemented the EU’s ADR directive. She endorsed the calls for a consistent set of measures to be used across sectors, and warned of relying on top-level data only, which could see a proportion of customers being forgotten about.

Melanie Onn MP spoke about her experiences as a local MP, and her constituents who have problems with the same companies time and time again. While many companies and other bodies have MP liaison teams, they do not always acknowledge that the MP has received consent from their constituents to pursue the case. Melanie also highlighted that companies do not always comply with rulings made by ombudsmen.

Meghan Tewari said that Ofgem recognised the need to bring parties together, including through its tripartite arrangement. She expressed concern at companies not abiding by ombudsmen rulings. Meghna also said that gathering and using more granular information has a positive impact on customer service strategies.

Lindsey Fussell recognised the concerns that Melanie Onn raised, and said it was unacceptable for companies not to implement ombudsmen rulings. She disagreed that multiple ombudsmen covering sectors prevents regulators from acting effectively.

John Russell said that the water industry had a different structure, with the Consumer Council for Water acting as the dispute resolution body for the sector.

Ben Bax, Customer Services Director at Kier Services Utilities, said that vulnerability is too often seen as a binary concept, but that in his experience people are vulnerable at particular points of time. He also spoke about the importance of regulators gathering consistent data, rather than collecting different data which places a burden on companies and providers.

Philip Davies MP, Chair of the APPG, brought the meeting to a close and thanked speakers and guests. 

Customer service in regulated sectors: APPG meeting minutes

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