Identifying customer dissatisfaction and improving satisfaction

A guide to identifying customer dissatisfaction and improving satisfaction

Customer satisfaction is now a key performance indicator for all local government services. Some services score quite well, reaching 70% or even 80% or more. But compare these figures to the best in the private sector and we recognise that we need to do better, even before we start considering those services that achieve 40% or below.

What makes customers dissatisfied with a service?

For non-users of the service, perceptions created in the media will be a large influence. Sometimes the satisfaction of non-users can differ greatly to users of the service - look at some of the customer satisfaction indices for social service providers where users rate the service very highly but non-users can rate the service very poorly.

Complaints matter

The customer satisfaction BVPIs gathered in 1999/2000 showed that 66% of dissatisfied local government customers had made a complaint in the last 12 months. The surveys carried out also showed that between 20% and 35% of the local population had made a complaint in the previous 12 months but how many local government services record that level of dissatisfaction?

The London Borough of Wandsworth records about 25,000 complaints every year but also has more Charter Marks than most other local authorities. Some local authorities record less than 100 complaints each year in stark contrast to the number of customers who say they made a complaint. The American marketing guru, Ted Levitt, has said that: "One of the surest signs of a bad or declining relationship with a customer is the absence of complaints".

Public services often have formal or official complaint procedures that do not record "informal" complaints that are resolved straight away. But don't these represent the dissatisfaction that we need to record and analyse? These are the customers who are saying that they are dissatisfied with the overall level of service. Compare this to the best in the private sector where customers are encouraged to give feedback (complaints, compliments and suggestions). Any negative or positive comments are logged and analysed, to make sure that products and services are improved and delivered in a way that is both cost-effective and convenient to the consumer.

A customer-centric organisation:

  • Encourages customer feedback
  • Examines feedback process through audit and management review
  • Supports Customers - proactively assisting disadvantaged customers to voice concerns
  • Empowers employees at all levels to resolve complaints
  • Listens and learn from customer feedback
  • Satisfies customers

An effective customer feedback monitoring system can tell us a lot about customer expectations and how well we are meeting those expectations. We can also use the system to identify different expectations across our local communities. Do customers living in socially deprived areas have the same expectations as those in wealthier areas? What about young people? How do we encourage young customers to give us feedback - in some black and minority ethnic communities, young people can be the active voice in expressing concerns about service delivery. The London Boroughs of Camden and Haringey have introduced specially designed customer feedback forms to capture feedback from young people in their local communities and recognise their rights to be heard and express themselves.

Bringing together people, processes and technology to record and resolve dissatisfaction

If we agree that we need to know and respond to customer feedback, we need to make sure that we have systems in place to allow us to capture this feedback at the point of contact. We need to move away from only accepting feedback in writing and make use of one stop shops and contact centres to capture feedback and, where necessary, allocate to specialist back office staff to investigate and respond to any complex issues.

Too often, contact centres are set-up to deal with customer enquiries but are not linked to complaint handling systems and processes. Some contact centres advise staff to send a leaflet to a customer who complains - missing out on opportunities to resolve a concern and even impress the customer.

Will Customer Relationship Management (CRM) give us everything we want to capture all of this valuable information? Let's look at a private sector example. A major insurance company contracted Siebel to bring together their sales, marketing and billing processes but the system could not deliver the sophistication necessary to properly manage and analyse customer feedback. The insurers went for a 'best of breed' approach and purchased a customer management software solution that now sits in twenty different departments and allows feedback about products and services to be captured in a single database. The system will be integrating into the Siebel solution to allow an employee logging a complaint to get an idea of customer-value or see whether someone making an enquiry about one product has an ongoing complaint about another product or service. Policy teams also access the system to make sure that feedback data is used in the future development of key policies (see Figure 1 for an example translation of potential users in a local government environment).

Some local authorities are taking a similar approach. The London Borough of Lambeth, with a long history of poor complaint handling, has made improved complaint handling a key priority and recently introduced a customer management system to log feedback from a large number of contact points, including reception areas, frontline service providers and customer relations teams. All feedback is gathered on a service basis but is stored in a single database that is already allowing Lambeth to identify the root cause of issues that cut across departments such as internal communication problems. Lambeth is now developing the system further to give councillors access from home to manage casework and instantly allocate constituent enquiries and complaints to an officer for investigation.

Effective measures

Figure 2 shows some key performance indicators for measuring the effectiveness of your customer feedback processes. If you are able to gather this information, you will be in a strong position to quickly identify problem areas on a local and corporate basis and take quick and effective action to put things right.

Measuring customer satisfaction must be a key target whether services are provided in-house or by contractors. Effective contract monitoring can only be done by keeping abreast of customer opinions and we cannot ignore the views of the customers who use our services.

Customer opinions must be at the centre of our decision-making. Customer feedback is one way of gathering opinions - on a daily basis - and also gives us an opportunity to improve satisfaction with our services. Our customers do sometimes have very limited choice - they cannot easily go elsewhere to get a service - but we should still be looking to identify any dissatisfaction and increase customer confidence by clearly explaining what can or can't be done. The Local Government Ombudsman's own studies of customer satisfaction show that only 13% of customers who complain to them first will be satisfied compared to 32% satisfaction when the customer complaints has the confidence to complain direct to the service provider. Surely, we can have customers who are confident that we will at least listen to them if something has gone wrong?


Figure 2

Base indicators

1. Number of complaints received by department

2. Number of compliments received by department

3 Number of suggestions received by department

Performance indicators

1. Performance in meeting published target times (responses)

2. Solutions applied (remedial actions including financial redress)

3. Number of complaint decisions upheld or overturned by the Ombudsman

Customer access indicators

1. Method of feedback (in person / phone / letter / email / paper form / web form etc)

2. Percentage of contacts by demographics (postcode, electoral ward, age, gender, ethnicity and so on)

Customer confidence indicators

1. Percentage of complaints made through a third party (such as elected representative, solicitor, CAB)

2. Percentage of escalated complaints by department

Customer satisfaction indicators

1. Customer expectations (apology, compensation, decision explained and so on)

2. Customer satisfaction with outcomes

3. Customer satisfaction with process

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