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Using Trouble-Shooting To Transform

13 September 2018

By Chris Murphy, Director of Regulatory Solutions, Equiniti Hazell Carr

Remediation is fundamental in highly regulated sectors that need to meet compliance demands and demonstrate due diligence to their customers.

Estimates suggest that regulatory change increased by 492 percent between 2008-2015 as the financial sector struggled to deal with the aftermath of the credit crunch making remediation commonplace. Yet whereas it was once regarded as burdensome, organisations are now beginning to realise remediation provides the ideal opportunity to critically evaluate business functions and accelerate transformation. 

Complaints are often symptomatic of a much wider problem associated with the operational workflow and can be indicative of ineffective or time consuming processes. 

For instance, Know Your Customer (KYC) remediation programmes often reveal issues with not just the onboarding process but the data flow itself. Problems can include poor control over data entry fields, difficulty obtaining and maintaining customer information, poor quality data capture and insufficiently trained staff. 

Past, present and future

If a remediation team has been called in to troubleshoot an area of non-compliance, it makes sense to use their expertise to look at how these systems and processes can be improved. As well as performing historic functions such as Past Business Reviews (PBRs), the assessor should be seeking to reduce risk and facilitate compliance in the future. This is achieved by appraising the way the business uses…

  • Technology: Estimates suggest banks can reduce the cost of regulatory change by up to 80% through automation. Remediation recommends technological solutions to automate key processes and to improve outcomes through effective data capture of customer communications and analytical capability to ensure future compliance. 
  • Human resources: Reports have found that the majority of users want to talk to a qualified human when purchasing and the phone remains the preferred medium when complaining. Remediation explores whether sufficient headcount is in the place, with investment where it is needed and that staff have the necessary skills to fulfil their roles.
  • Workflow: Disjointed processes can grow organically overtime as a business expands, impacting operational efficiency. Remediation seeks to streamline these processes using technology to deliver highly flexible, multiple workflow streams that guide users seamlessly through a prescribed process.

Organisations that can look beyond the immediate remediation objective are able to see how changes to their operating model can ensure current and future compliance. Benefits associated with using remediation to transform include:

  • Improved service delivery: alignment and integration of business functions prevents the ‘broken’ service model that can typically lead to complaints.
  • Customer-centricity: processes become more streamlined, facilitating faster resolution, while data is more accurate and accessible helping to make customer communication and resolution more effective.
  • Instructive insights: Reports and Management Information and Root Cause Analysis insights are delivered to senior personnel to inform decision making. In combination, better reporting and analysis build trust in the brand, making it more competitive.
  • Eradication of data silos: data quality management and tracing services help the business to identify and manage data populations for remediation, combining and updating datasets from multiple systems stretching across the business. 
  • Routine remediation: the organisation is able to rapidly respond to remediation demands without disruption to the business with access to a dedicated remediation team who can be deployed on demand.
  • Reduced operational costs: implementation of future-proof automated workflow processes and remediation tools brings down the cost of compliance over time.

Transformation in action 

In the financial sector, businesses are now beginning to realise remediation presents an opportunity for change and transformation and in doing so can deliver significant cost and efficiency gains. 

In 2016, a major UK retail bank sought assistance with the remediation of 500,000 unsecured debts across multiple brands to ensure compliance. Working collaboratively with the bank we were able to advise upon how the project could be used to digitally transform their case management process. 

The end result saw the automation of 65 percent of cases, spanning 18 case categories, giving the bank an 85 percent reduction in case handling time and more than £14 million in savings. By considering how cases could be more effectively handled, the bank transformed a key process which will continue to be used to service future debt handling.

The automation of workflow saw complaint handling reduced by 50-65%

In another example, a retail bank sought to efficiently resolve over 200,000 customer claims for PPI. A stand-alone solution automated and simplified processing into a single workflow, reducing the time taken to action claims from weeks to days. 

The automation of workflow saw complaint handling reduced by between 50-65 percent, allowing the bank to reduce headcount.

Root Cause Analysis then identified a number of business processes that could be improved, leading to a reduction in complaints, increased customer retention and a reduction in the costs associated with corrective action. Streamlining workflow therefore had multiple knock-on effects enabling the bank to achieve cost savings and better customer relations. 

What both these examples illustrate is that regulatory remediation has the capability to add value, reduce cost and increase efficiency across the board provided the project is forward looking enough and seeks to look ‘above the line’ so that the scope of the project doesn’t limit potential. 

Remediation conducted in this way is no longer reactive. It realigns operational processes and protects the business against future change while delivering real cost benefits, which is why remediation should now be driving transformation across businesses.

Contact us to find out how Equiniti is helping organisations use remediation solutions to transform their business operations.

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