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Doomed Firms Ignore Customer Complaints

Firms that ignored customer complaints were taking the first step on the road to failure, the Australian Competition and Consumer Commission Deputy Chairman, Mr Allan Asher, warned today.

"In the past, complaints and complaints department were places in organisations seen as a somewhere where someone was sent as a punishment," Mr Asher said. "Only recently has complaints and complaints handling been seen as an important guide to what consumers want. "The way a company handles complaints is the best predictor of a company's future. If a company ignores complaints, customers will begin to ignore it.

Mr Asher was launching the National Complaints Culture Survey conducted by the Customer Service Institute of Australia in Sydney today (July 8). He commented that the survey showed that 64 per cent of Australians do complain most of the time when they feel it is warranted.

"This provides evidence that service expectations are growing significantly in this country.

When people are not happy about a product of service they've purchased they feel, and rightly so, that they have the right to complain and to see their complaint addressed. Organisations have a lot to lose if they ignore customer complaints but also a lot to gain from putting in place effective complaints handling systems".

Mr Asher said an effective complaints handling system served to preserve an organisation's reputation for fair trading and to promote the loyalty of customers.

"By promoting its complaints handling system through a customer service charter, I believe an organisation can achieve a distinct marketing advantage in attracting and retaining customers. It can improve its image as being accessible and user friendly. A comprehensive recording of complaints can also provide intelligence and feedback on the shortcomings of products and services and on consumer demand. This can lead to insights on how to improve products and services or increase market share".

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A company wanting to set up an effective complaints handling system should look to the Australian Standard on Complaints Handling (AS4269), a "best seller" which set out the essential elements.

Mr Asher said it was heartening to see from the survey results that participating organisations understood the value and importance of complaints. It also highlighted problems in the areas of training, ability to change according to new conditions, a tendency to reward a reduction in complaints rather than encouraging customer feedback and not enough organisations encouraging 'positive complaints'.

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