Imagine a set of scales built to measure the service deliveries associated with Receivables Management. On one side of the scales sits desired business outcomes and on the other, consumer outcomes.
Imagine a set of scales built to measure the service deliveries associated with Receivables Management.
On one side of the scales sits desired business outcomes and on the other, consumer outcomes.
How the business chooses to invest is a by-product of what they value and how they define performance.1 And, the decision around investment is often a reflection of business goals, ethics and standing on corporate social responsibility, creating the ballast to weight these two outcomes.
In an environment where positive financial return for shareholders is paramount, we interview Melanie Randell, Head of Business Optimisation and Risk on customer safety vs satisfaction in the receivables management industry and ask the age-old question around win-win: Is it possible to deliver a positive outcome for both businesses and customers – especially at a time when business complexities, expectations and regulations continue to expand?
Q: Customer satisfaction and safety - What’s the difference?
A: “Customer satisfaction is essentially about making a person ‘happy’ and is often the result of an offering or experience that meets customer expectations factoring in cost and value.
Customer safety is about protection against faulty or unsafe products and services, and can include the unfair treatment from businesses.2
There’s definitely a connection between the two, but they are separate.”1
Q: What’s your take on businesses achieving both short and long-term sustainability in the receivables management industry?
A: “It’s really about adopting a balanced approach.
All companies are in the business of making a profit, and to maximise profit you must exchange your product or service at the greatest price-point above production costs.
Doing this sustainably however means they need to ensure that today’s success does not impact tomorrow’s success.
While business self-interest (profit) is arguably the primary driver of actions taken by business, we’re reminded constantly in our line of work that running a sustainable business is not just about self-interest. Taken to extremes, self-interest can in fact yield scenarios where one party ‘wins’ and another ‘loses’, resulting in a fractured negotiating relationship and an inability to maximise value for both sides.”
Q: At what point does the desire to maximise profit move parties into the territory of winners and losers?
A: “Winners and losers start to emerge when there is an imbalance of power, and once the equilibrium is threatened, businesses can more often than not, maintain the position of power.
This is the point when increased external scrutiny and intervention occurs in an attempt to achieve greater levels of balance between parties, and move business returns to more a commercially and customer reasonable position.
With the absence of profit motive, one could conjecture that there would be limited motivation to invest in customer centric innovations, focused on optimising business processes and delivering enhanced customer experience and improving operating margins.
However, industry report cards would indicate that we haven’t yet reached an optimum balance between business and customer outcomes, and that at times we are finding them out of step.
There is consensus that short-term customer satisfaction should not be at the expense of a customer’s medium to longer term financial health or safety.3
The adoption of this approach enables a healthier customer experience and journey, with the right products and services delivering more positive outcomes during the entire customer lifecycle.
Q: In terms of financial sustainability for businesses and customers, where do you see some of the major challenges or scope for improvement?
A: “There’s still work to do on preventing unserviceable consumption and debt levels, debt accumulation, and the customer experience journey, such as:
At recoveriescorp, our mission is to help build a financially sustainable future for businesses and customers. What this means is continuously considering the attributes and approaches that will have us facilitate more win-win scenarios. Working with clients to deliver best practice solutions and customer-centric technology will no doubt enhance the customer lifecycle journey, but striking the balance between customer satisfaction and safety will be key to our collaborative success.”
If you’d like to learn more about the topic explored in this piece, please email newsandviews(at)recoveriescorp.com.au for further information.
1 Linking the customer experience to value and investing where it matters most – McKinsey & Company
3 Creating Value through Transforming Customer Journeys – McKinsey & Company
4 Financial literacy adds to pain - ABC