Here's a riddle from SourceMedia's third annual Mortgage Regulatory conference: When is a consumer complaint not a complaint?
Answer: When it is resolved on the first call. Or when it is embraced by the associate so the customer does not have to do another thing to resolve his issue.
"If you can nail it on the first call, you can own it," Lisa Ducharme of Ernst & Young's customer service practice told the meeting. "Then, it becomes preventative."
Craig Martin, Ducharme's co-presenter during an hour-long session entitled "Making the Most of Customer Complaints" and director of the mortgage practice at
"It's not always about resolving the complaint at the first point of contact," Martin said. "It's about relieving the sense of burden so that the customer has confidence that his problem will eventually be resolved."
Martin and Ducharme advised the audience to accept a complaint from a customer as a gift. "Organizations that embrace complaints and the voice of the consumer are able to drive effective process improvements and prevent future complaints," they said in their joint slide presentation.
According to a 2012 E&Y report, customers are still losing confidence in their financial institutions, years after the banking collapse.
"A huge number of people no longer look to you as a trusted advisory," Ducharme told the audience of mortgage industry executives. "They used to come to you for every single piece of advice, but that's changed."
At the same time, she added, lenders and servicers are being hit with new regulations, with the Consumer Financial Protection Bureau placing greater emphasis on complaint management.
"Resolving customer complaints has become increasingly more important in a complex regulatory environment," she said.
And that gives bankers "an opportunity to engage their customers sincerely," said Martin, who pointed out that a complaint about a mortgage or servicing is "a lot more personal than the standard banking complaint."
The two experts said an effective complaint management system will not only improve the overall customer experience and keep the regulatory wolves at bay, but it also will reduce operating costs by finding problem areas and fixing them before they get out of hand.
Establishing an end-to-end problem resolution framework "helps drive how consumers feel about the organization and brings back trust," they said.
According to the E&Y study, half of all banks are not confident that their front-line workers understand their company's problem resolution process or how to properly escalate a complaint to so can be solved. "That's a big number," said Ducharme, who has nearly 25 years in banking. "It speaks to a lack of preparedness and training."
But J.D. Power's 2013 Primary Mortgage Satisfaction Survey found that using a single point of contact for complex problems can significantly improve a customer's experience. There's a 153-point difference in overall satisfaction for customers working with a lone contact in a loan modification than when multiple contacts are necessary, Martin reported.
Ducharme said the issue consumers find most aggravating is when they have to call back to find out how a problem has been resolved. "Executing this well is critical; get it wrong and it is just one more bone of contention," she said.
Inside the organization, meanwhile, companies can use customer-centric compliance to identify key areas of risk and adopt proactive approaches to help minimize future complaints on the same issue.
"You can use predictive analytics to identify what's likely to be a complaint before it becomes one," the E&Y executive said.
Lew Sichelman is an independent journalist who has been covering the housing and mortgage markets for more than 40 years.
