I have a mixed view of reality television; namely that I would like to see many of the phenomenon’s producers, commissioners and ‘stars’ placed into an industrial mixer. But one series did catch my eye recently and that was Channel 4’s Undercover Boss. For those not familiar with the premise, a CEO or person of similar standing within a high street brand goes ‘back to the floor’ to discover why their business is failing. They don’t get the nous of the fiery-headed Mary Portas or the like, but they do tend to come away with a raft of extremely useful insights and recommendations on how they can improve operations, thanks to their ground floor staff who face the brunt of these issues every day.Decentralised organisations are hardly rarities in today’s global business culture where the span of control is as wide as the country areas covered, but fundamental to the success of any business is that strategy and communication are maintained throughout. Decentralised organisations enjoy the input of multiple stakeholders and are often subject to the conditions of many different international laws. Each department will have requisites relating to its own operations and, with Expolink’s Hotline service, it is important that each is consulted from a very early stage. With multiple stakeholders involved, you must ensure all parties are engaged and understand the importance of their contribution to the success of the Hotline.
Of the many advantages of maintaining a decentralised business one of the greatest is the scope for collaboration and input across the board. The challenge is to ensure that by having so many contributing agencies your message and strategy does not get diluted as the information percolates throughout.
As your trusted whistleblowing service provider we would like to offer some advice when considering how best to manage the service in a decentralised organisation.
In the next in our Q&A series we get the benefit of Fraser McLaren’s considerable expertise on risk management in the global market place, compliance, the ubiquitous Bribery Act and more. Fraser McLaren is Head of Business Risk at Centrica.
Tell us more about the challenges a global organisation with suppliers all over the world face in terms of risk management.
Centrica has an increasing portfolio of supply and service arrangements in offshore country locations such as India, South Africa, Poland and Portugal. Offshoring carries a number of risks including exposure to political risk, natural disasters or breakdown of critical infrastructure. The impacts of these risks can be varied, but could include supply shortages, price increases or damage to the company’s brand and reputation. We manage risk at all stages of the supply chain from checking whether potential suppliers meet our corporate responsibility criteria, ensuring adequate contingency arrangements are in place during the contractual phase and monitoring them through news feeds, country alerts and other third-party and supplier intelligence.
We regularly review country risk and have contingency plans in place to ensure that, at a potential time of chaos, we’re able to protect people and, financial and physical assets in the supply chain. We also take a very proactive approach to supplier risk, particularly in light of global economic conditions, including regular financial health-checks of our key outsourcing partners. We’re also recognised as thought leaders in the development of outsourcing/offshoring best practice by the National Outsourcing Association and have picked up three awards in the last three years. The latest award came at the European Outsourcing Summit, where we were presented with the ‘BPO Contract of the Year Award’ for our partnership with our outsourcing partners EXL.
What compelled you to employ a confidential, independent Whistleblowing Hotline, and in particular, Expolink’s?
Centrica is committed to operating professionally, fairly and with integrity wherever we work in the world and we have a set of business principles which set out the behaviour and standards we expect from all employees. If employees do have any concerns about any possible improper, unethical or illegal practice within the organisation, we want to know about it as soon as possible. While we encourage staff to raise any concerns in the first instance with their line manager, we recognise this might not always be possible and that’s where Expolink comes in. We officially launched the service back in 2007; since then I’ve worked with the Expolink team as we’ve changed the way we transfer data between the two parties and also developed a number of new and innovative ways of keeping the service visible.
Where does the Hotline fit in with your compliance strategy and what benefits have you noted?
Compliance is just one strand of our overall business principles that set out the standards we expect and which all employees must work to at Centrica. We actively encourage staff to share their opinions, ideas and concerns, be it through team meetings, briefing sessions, at events or even through suggestion schemes. Overall, I think that staff do feel they can do so openly and our internal employee engagement scores and high entries in externally Best Place to Work competitions suggest we’re getting things right. The hotline is another method open to employees to raise any concerns they might not feel comfortable raising through another channel. The outcomes of the investigations into any allegations raised via the hotline have also led to a number of business changes including improvements to security measures and a review of some sales and expenses processes.
How do you communicate/market the Hotline service throughout Centrica?
In line with best practice outlined in the Whistleblowing Code of Practice, we regularly promote awareness of the hotline. Examples are displaying posters, articles on our internal intranet, reminders on plasma display screens throughout our calls centres, making sure the hotline is covered in our employee induction material, printing the hotline number on name badges and carrying out periodic surveys to test people’s awareness of and confidence in the hotline arrangements and then publishing those results. We also took the opportunity to raise awareness of the line and promote the value through our anti-bribery communications programme.
As a global organisation what impact do you think the Bribery Act could have on Centrica?
If anything, the arrival of the Bribery Act has underlined the importance of the hotline. The first of Centrica’s business principles deals with ‘integrity in corporate conduct’ which commits us to implementing anti-corruption policies and procedures. Our second business principle ‘ensuring openness and transparency’ commits us never to engage in bribery, any form of unethical inducement or payment including facilitation payments and ‘kickbacks’. We expect employees to report actual, potential or suspected corruption in Centrica or by any individual or organisation Centrica does business with.
Section 7 of the new Bribery Act which introduces the offence of failing to prevent bribery has implications for all commercial organisations. Although as an organisation we always endeavour to operate ethically, the new legislation resulted in a significant piece of work taking place in developing adequate procedures. Centred on the 6 principles outlined in the UK Government guidelines this included embarking on a detailed risk assessment programme across the business, updating group policies, introducing even more stringent due diligence processes, especially concerning supply chain and mergers and acquisitions, and reaffirming our measured approach to gifts and hospitality. An eLearning training package was also developed and successfully delivered.
What are the key tools for identifying business risk in the energy sector?
There isn’t one key tool for risk identification, and these identification methods aren’t unique to the energy sector; there are a number of different methods of identifying risk. These might include workshops, brainstorming exercises, interviews with key stakeholders, the use of checklists or benchmarking with other organisations. More recently, and perhaps linked to the pace of change in the external environment, for example events in Japan and North Africa and well-publicised cyber attacks, we’re tasked with bringing more of an external challenge to our risk profile. This can be done in a number of ways, for example reading news articles or attending industry benchmarking or discussion groups.
As Europe becomes more integrated, working practices change fast and often affect more than one country at a time. How do you keep abreast of what affects you and your company?
It’s important that Centrica gives proper consideration to the risks inherent in sourcing services from a variety of locations around the globe, not just in Europe. We try to ensure processes are in place to monitor potential threats to the delivery of products or services to our customers. This includes monitoring elections, changes in executive and legislative power, labour union activities, internal politics and regulatory stances, as well as international relations. We also have a cross-group committee that meets regularly to discuss emerging risks and to develop a consistent approach to managing supplier risk in the company. The increasing focus on our corporate responsibility obligations and commitment are also drivers for building a cohesive approach.
What is the split between energy regulatory compliance risk management and generic operational risk? And has this changed over the years?
Centrica and the energy sector in general, are subject to significant levels of regulatory oversight covering issues such as retail competitiveness and energy market reform. The picture can be even more confusing in North America where legislation or regulation can vary by state and province. To help mitigate these risks, we develop internal policy, and externally, engage with government, regulators, parliament and media to help build knowledge and understanding among our key stakeholders. Compliance risks are picked up as part of our wider operational risk process, but they also receive additional scrutiny from the general counsels of each of our main business units.
If you could give one bit of advice to a counterpart in risk, what would it be?
Keep the process simple. The real value of risk management comes not from the process itself or any complicated assessment methodology, but from the conversations that take place to review these risks.
A quick brain teaser for you on this late Summer morning; Aside from their initials, what do Cheryl Cole and Contact Centres have in common? They have both returned to the UK after failing to make it overseas. But all joking aside, the latter and somewhat less entertaining acronym has made the headlines recently, for after an era of overseas outsourcing it seems a trend is emerging towards brands bringing their contact centres back to the UK.
During this economic ‘winter of discontent’, opting for a domestic contact centre is becoming a way of aligning your brand and business with local values and, as our ever changing world spins dizzyingly on its axis and global economies morph in its wake, it appears that such hitherto money-spinning relocations could become a thing of the past.
This year Santander is moving operations back to the UK after receiving a high level of complaints, 165,000 in the latter half of 2010 alone. A spokesperson from the company stated that dealing with an off-shore contact centre caused “frustration that can lead to dissatisfaction”. The financial giant bolstered the news of its relocation with a branding overhaul and a new strapline, “driven to do better”, denoting its commitment to a better class of customer service. Societies are well accustomed to a global business environment, but it seems that consumers hesitate to embrace the notion of having their financial, sartorial or other needs dealt with by a call handler who could be many thousands of miles away, in a different time zone and who may well be fresh from a daily briefing about the goings on in Albert Square.
Rather than language issues or grievances over accents, a lack of cultural affinity is thought to be a key factor in the failure of some overseas contact centres to engage and satisfy customers. If a customer has a complex or contentious issue, any obstacle to empathy or understanding between the call handler and caller can escalate rapidly to a point where both brand and solution are irreparably marred. Having a conversation with an individual who relates and empathises with your issue and can analyse the problem within a shared cultural context is crucial to a satisfying and progressive business relationship.
Telecoms provider, New Call Telecom also recently returned to the UK after discovering the disparities in call efficiency between the UK and their outsourced offices in India. Speaking to the Economic Times CEO Nigel Eastwood asserted; “The average (call) handling time in the UK is three minutes. But if you go out to India you add another minute, unless it is a very efficient operation… we can actually reduce the head count with the saving”
During the earlier stages of relocations to India, low property and salary rates warranted the move, but in recent times inflation and prices have increased; Indian wages are expected to rise 13% over the next year. In short, what was working economically for businesses is no longer working for them or their customers. At New Call’s new offices in Burnley, Lancashire the rental cost in pounds per square foot is similar to that in major Indian cities and the area has good scope for an economicaly viable workforce. In addition, there are no extra costs for transporting managers or other staff to review progress on site and manage any issues.
As economic pressures mount throughout the world notions of patriotism come to the fore and businesses that show themselves to be supporting local economies and communities receive praise in the media and from politicians. Brands will undoubtedly be using Santander et al as litmus tests for their own future strategies. Astute brands know that failing to listen to the needs of their customers is integral to on-going success. It could be that consumer’s disaffection continues to pull the tide that will cause the sea change.
At the beginning of July this year Expolink took on a loyalty campaign for The Daily Mail. The paper was launching a promotional campaign across its weekend editions to encourage sales and long-term customer loyalty. It needed a contact centre to complement its online presence and anticipated that 4% of contacting customers wouldn’t have access to the internet or would need support filling out the web form.
More than anticipated, out of 30368 calls in July, 13.9% were responding for those very reasons. 65% of those callers were making contact to ask for advice or support relating to the promotion. These figures show unequivocally that there is still a very real and enduring need for human contact options.
Readers were encouraged to collect tokens from The Daily Mail which would allow them to accumulate discount rewards from major retailers.
The results reflect the fact that a considerable chunk of the paper’s market base, while still active consumers, still required support with the promotion. Imagine if the lines had not been in place and a potentially loyal customer of the paper had been unsure of the functionality or benefits of the scheme and had fallen at the first hurdle? That’s a considerable impact, not only on the paper, but on the paper’s retail partners, who we can be sure have their own loyalty strategy to fulfil.
The Office of National Statistics estimates that internet usage almost doubled in the UK between 2006 and 2010, a perhaps unsurprising figure given the proliferation and popularity of internet shopping and social media. However, on closer analysis, socio-demographic factors come into play. 60% of those aged over 65 had never accessed the internet compared with just 1% of those aged between 16 and 24. A cursory scout around one of The Big Four or any shopping centre will tell you that it is not just this latter age group that should be a target for consumer loyalty.
Turning to regional demographics, while 83% of folks in the capital are estimated to have their own internet connection, just 59% in the North East say the same. Perhaps most enlightening of all is the reasons households give for not having their own web connection; 39% said they just did not need it and 21% said they did not have the skills. These are two facts that businesses cannot ignore when reviewing their strategy for a campaign. Making your communications as inclusive, user-friendly and coherent as possible is fundamental in achieving profit, loyalty and optimum customer care. Our campaign continues to enjoy success for our client due to the commitment we have to our client’s customers. The response has also proved a vital exercise in customer awareness and will help the paper continue to achieve loyalty successes within their market base, in what are very uncertain times for our national press.
