Prehistoric bureacracy drags £300m of taxpayer cash into the tarpit

Julian.RHarris — Mon, 26 Nov 2007 10:39:00 GMT

Last week's failure of the HMRC to undertake basic steps to protect the data of some 25m-odd British citizens is a classic case of how IT by itself is of no value at all. All the retinal scanning in the world is of no use if it's not actually employed.

We're the tail end of a cultural revolution right now -- moving into a true digital age, where online is woven into society. What happened above was stone age thinking leading to a blundering oversight. The issue fundamentally comes down to perception -- how can losing a couple of small pieces of metal and plastic potentially cost the taxpayer £300m? The risks associated with sending several hundred kg of printed material of a similar nature would've been abundantly clear.

Lack of basic IT literacy is what caused this debacle. Governments all over the world lumber in a taxpayer-funded gravy train, using old value systems and old methods of working that just don't take into account modern day needs and risks.

It's time some of the fat was cut. And it's not from the bottom -- it's from the grey suited middle management encumbents that have no real incentives to improve. With the money saved, get some decent IT literacy into the departments.

Or better yet, hire some digital natives -- almost anyone under 25 fits this: they'll be full of ideas and be fluent in today's new digital channel.

Education in Financial Services: I don't want life insurance! (But I realize I do need it.)

Julian.RHarris — Mon, 19 Nov 2007 19:00:00 GMT

The dangerous mix

Why do we need the Treating Customers Fairly (TCF) principles? Many financial services products are a dangerous mix of elements: they’re generally uninteresting, complex to understand, and yet carry dire consequences if not used properly. A bit like an army mission then: 99% of the time stupefyingly boring along with 1% sheer terror. And weirder still – some you pay for in the hope that you don’t need them!

Consumers need protection from this. You buy a new fridge – it’s pretty easy to compare one against another, whereas you may not even know you really need critical illness insurance. The FSA is responsible for making sure consumers are protected, and with the recent subprime crisis, it’s quite clear that even with them there are some delinquents in the FSA nest. £500k mortage? That’ll be fine on a salary of £30k, no problems! Without the FSA at all, you can imagine the mess we’d be in.

TCF has to be taken very seriously now.

December 2008 looms, and with it a TCF mandate from the FSA requiring demonstrable proof that customers really are being treated fairly, with management information and everything. The FSA has offered extensive literature on the framework, but in addition, Conchango has some specific recommendations for your digital customer experience.

I read a customer review about it. They’re great when it comes to claims, and they love them for it.

The way customers find out about products and services has fundamentally changed. The majority now trust more what their peers say than any amount of product literature. Their experiences are shared online like dirty laundry, for all the world to see. Sometimes then, customers’ first contact with your product can be from these raw, subjective experiences. And for financial services products, servicing experience is what people will be most interested in: it’s hidden from view, yet is often the whole point of the product! Every company has a bed of roses onramp to their product – this is assumed. But when you accidentally go into overdraft, or you drop your ipod into the drain at the bus stop, what did they do then? You need to deploy agents online and directly contribute to these conversations, correcting errors and making amends. This is one on one: broadcast has no effect here.

They answered all my questions, in terms I understand (I shouted from the rooftops about it).

The foundation of TCF is understanding and satisfying the customer’s genuine needs. Not wants. So to avoid having the FSA waggling their finger at you as a product provider, it’s a good idea to figure out how to cost-effectively educate your target audience. Modern day technology makes knowing your customer much easier than before.

Use plain English: being complex to understand, let customers ask questions in plain language with plain responses. Let the entire customer history influence the responses.
Give a little, get a little: let customers build up ‘what if’ scenarios based on small increments of information they share. I’m a male, what will my premiums be like? What if I’m a male dentist smoker? What if my date of birth is 1964? No boring long forms to traipse through – it becomes an insightful, exploratory exercise. Financial products are complex and are great candidates for rich, visual applications that today’s web browsers can show easily.
Allow them to share: share selected details, but anonymously. Then foster communities that can benefit from this information, and learn together. You’ll find passion in these communities: reward the evangelists with special privileges. Bring what the community shares into the product design process.
Integrate the channels: when a question is asked, this should be treated like gold: keep it. Have a ‘call me about this question’ button, next to one labelled ‘chat to me online about this question’. While they’re waiting, look the question up in your knowledge base. And if there isn’t someone available after a moment, archive it, and give the option of a callback, email, or SMS.

The clock’s ticking – but luckily there’s still time to innovate. Let me know if you have any other ideas!