No Conflict between Compliance and Service Quality

Written by Steve Young on

Many firms are now trying to align the need for regulatory compliance with customer expectations for service quality. In theory this should be possible, as generally speaking regulation is introduced for the benefit of the end consumer. It is clear that firms that can prove that they are efficient and effective in implementing regulation and satisfying the regulator should be in a position to improve many elements of customer service. For example, in the UK, the focus on suitability has led to many firms introducing technology and process to improve the whole customer experience, quality of service and advice.

There does not need to be a conflict between regulation and servicing customers.  Much of the current regulatory flow is only trying to enforce standards and expectations that non-financial firms would take for granted. Financial firms need to adopt a longer-term perspective and instill the principles of the regulators at the very core of their operations. Firms would then find that the outcomes benefit all parties.

Innovation is starting to return to the City, albeit very slowly. Some areas are seeing more new products and suppliers come to market. Customer Relationship Management (CRM) is one area that has evolved dramatically within investment management. Many firms are now benefitting from improved CRM as a result of suitability requirements, or increased management information resulting from the new regulatory reporting requirements. Client reporting and performance measurement are also showing higher levels of innovation. It is no coincidence that these three elements are all absolutely key to providing a leading edge and high quality customer experience.

For smaller firms, the move to cloud computing is good value.  Not only do services such as Office 365 provide great flexibility in the way that a firm can be organized internally, but the cloud also enables the firm to benefit from cheaper and smarter applications enabling new services to be delivered to the client quicker and cheaper. Look at the developments in client reporting systems: no longer are these multi-million pound investments that only the very large firms can afford; these services are available on a pay-as-you-go basis.  If you look at the challenge to banks from new entrants such as money payment services or peer-to-peer lending, these have only arisen because of technological innovation.

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