In this first of a two part special, returning guest presenter Ian Harrison, Verints’ own Director of Customer Experience chats with Tanushree Dabral, CEO of PX Partners and an accomplished governance, risk, and compliance practitioner. during this episode Ian and Tanushree discuss what compliance means in the current climate, why its needed and the impact it has on customer engagement and the wider CX Landscape
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In conversation with . . . is a series of podcasts from Verint featuring chats and discussions with leading figures from the contact centre, CX and customer engagement industry across the Asia Pacific region.
Martyn Riddle: Hello, and welcome to In conversation with…, a series of podcasts from Verint, featuring chats and discussions with leading figures from the contact centre, CX and customer engagement industry. During this series, we want to find out what customer service organisations are doing during these challenging times, and try and discover what it is that drives the leaders in this space, and what makes them tick.
My name is Martyn Riddle, and as well as being your host for the series, I’m also Verint’s Vice President of Marketing for the Asia Pacific region. After a short break, we’re back with the first of a special two-part podcast on the topic of compliance. What is it? Why do we need it? What impact does it have on customer engagement and the wider CX landscape?
To discuss these questions and much, much more, I’m once again handing over the reins of the podcast to guest presenter Ian Harrison, Verint’s very own Director of Customer Experience Optimisation, and a man that has lived and breathed the compliance environments during his many years working for a number of large Australian financial institutions.
Joining him in the conversation is Tanushree Dabral of PX Partners. Now, Tanushree is a governance, risk and compliance practitioner with over two decades of experience working across jurisdictions in Australia, Asia and North America. She has built a portfolio of deep expertise designing bespoke compliance and operational risk and management frameworks working with financial organisations, including the Commonwealth Bank of Australia, Westpac, National Australia Bank, and the Royal Bank of Canada and American Express to name just a few. With that distinguished background, this really should be a great compliance discussion. Ian, over to you.
Ian Harrison: Okay. Well, Tanushree, welcome. It’s good to catch up and get to talk to you about governance, risk and compliance.
Tanushree Dabral: Very happy to be here.
Ian: I know you’ve obviously spent most of your career in that world. Maybe the obvious question is, what is governance, risk and compliance? Why should we be thinking about it in large organisations? I guess also, who does it actually apply to?
Tanushree: Yes. Okay. Well, lovely to be here. Governance, risk and compliance, in a nutshell, I would see as the foundation to help a company execute on its strategy. If we break that up, compliance you can think of as the gambles, so what do you have to do? Risk, is in the strategy that you want to execute, where could things go wrong and are you happy to accept that or do you want to mitigate that? Then governance is really about do you have the right structures and decision-making processes in place and the right oversight mechanisms.
In terms of what applies to everybody is a cliché. I think to say a risk is owned by everybody but, in a way, it is because risk is actually best managed by the people that are day-to-day taking the risk and involved in the processes.
Ian: Do you think that’s changed over the last few years, that more and more parts of the organisation are realizing that they can’t avoid their accountability for risk and compliance?
Tanushree: Yes, I think it has. I think it’s interesting you’ve used the word accountability because really, that’s what we’ve seen from a regulatory perspective. Accountability regimes coming in. They’re, in the banking sector, I think it’s being referred to as FAR for upper regulated entities. With that, we are seeing executive accountability being, if you like, mandated by the regulators. In conversations with clients, it has been interesting to see how the language of accountability is starting to trickle through in a way that perhaps prior to these regimes was less common to see.
Ian: I know if I think back to some of the exposures I’ve had to the risk community, I suppose it’s been one of the things that, in my mind, waxed and waned, like you could see where there’s suddenly been a response to a regulatory issue, the risk community seems to grow, and then it seems to shrink, and it fluxes up and down. Do you see the recent changes, particularly in Australia, in terms of the Royal Commission, and the Banking Code of Practice is going to continue to drive changes in the resourcing and the focus or do you think that that’s something which will, again, dwindle and reduce overtime?
Tanushree: Yes. I think it’s interesting. I think with the Royal Commission, and probably less so the regulatory change coming out of the Royal Commission, but more so the enforcement action, we have seen firms preemptively start thinking about what their needs are. If there’s a large, say, AML enforcement in one organisation, then pretty much everybody starts looking at their own processes and resources in that space.
From that perspective, I think resourcing we’ve seen a trend for, that it has increased. From what we’re hearing in the market, people are struggling to find the right risk and compliance resources. I think with the last year and the pandemic, what’s been interesting is that leaders have started thinking about their risk and compliance capability more from that capability perspective as opposed to headcount.
If that’s the outcome we want to achieve, now that we no longer have people sitting at desks Monday to Friday, just being more creative about how they can achieve it. Whether it’s adoption of technology, whether its use of service providers, I feel like the pandemic has accelerated the trend towards people thinking more creatively about fulfilling that as a capability.
Ian: What about the general trends? What sort of trends and challenges do you see ahead in the years to come? Do you see that there are particular parts of an organisation that’s going to be more impacted in those changes than others?
Tanushree: Yes. I think one trend is just the consumerisation of technology. In our day-to-day lives, we’ve all gotten used to using very well-thought-through very user-friendly, simple, effective technology. Anything from the way we order food to ordering a car. Now for a lot of us, though, when we go to work, the enterprise technology isn’t necessarily catching up from the customer-friendly side of things.
If you think about customer-facing teams, they’ve already got a lot that they’re needing to be across. Let’s say it’s a call centre, you need to be handling the call within a prescribed process of meeting the customers’ needs, looking at handling times, doing it compliantly, but while still managing to delight the customer. It’s a lot to try and achieve.
I think organisations that can think about what burden can they take off the operators and agents in terms of looking after the hygiene of, say, compliance, are better placed to keep their customers delighted and retain their staff as well. Being a compliance professional, I guess I can’t answer that question without also commenting on the pace of regulatory change. I think that is going to be a continued challenge.
The financial service industry anyway, did get a lot of reprieve over the last year with the regulators delaying some big changes but that’s back on the agenda now for 2021. I think what’s going to be important for organisations and management teams is actually going to be looking at the regulatory change as a portfolio, and by doing that, impacting their frontline teams as infrequently as possible.
If you’re making a change for DDO, and you also need to make a change for the internal dispute resolution, regulatory guide, then how can we roll that into only impact our customer-facing teams once, I think is going to be key.
Ian: The ability, as you say, single source of truth, communication, more knowledge solutions, et cetera,-
Ian: -to ensure everyone’s up to date, and concurrently up to date is a challenge.
Tanushree: That’s right.
Ian: That’s interesting. I know McKinsey’s talk a bit about this concept that I like of white-glove service or “care of one” and you read through the research, and where they’re suggesting things go, very much as you said, I’ll look at that and then go, “Oh, that sounds fantastic to provide this beautiful white-glove service for every customer,” in the context of, “Make sure you follow this regulatory guideline. Make sure you say this, don’t say this in the wrong order. Make sure you finish with this,” and, “Have you done this privacy check?” and, “Are you breaching anti-hawking guidelines?” or whatever it is.
That, to me, when I sit there with call centre agents, stresses me out just watching them as they do their job, it’s incredibly complicated. How do we balance that challenge of providing that beautiful, caring service that everybody is aspiring to, wanting to engender trust and loyalty, at the same time of doing the right thing?
Tanushree: I actually think the keyway of enabling that is really about management teams thinking quite deliberately about what parts of this can we automate, make easier, have customer self-serve, but in a meaningful customer-friendly way still, so that the employees and the agents at the end of the phone are able to focus in more on the aspects that resonate with the white glove service and do delight the customer.
I think and I’ve supported call centres from a compliance perspective, and I completely agree with you, going in and listening to those calls and looking at the amount of information that the agents do need to navigate while they’re being continually monitored, in that environment, your performance is measurable and live in a way that, say, in a branch, it may not readily be. That, I think, adds a unique kind of pressure. I think that really the onus and responsibility is on leaders in that space to think about how to make the jobs easier for the agents as opposed to the onus really being on an agent figuring out, “How do I do this well myself?”
Ian: No, I think you’re right. My view is, there used to be this fear that when AI and automation comes along that all of these call centre agents are actually going to lose their jobs. Whereas I actually think what will happen is a lot of their volume, yes, they can go to self-service channels and be, as you say, simply governed through appropriate rigid technology controls, but the agents will actually be wanting assistance to do their job better.
Tanushree: That’s right.
Ian: As the work is more complex and long-running, then they need technology that helps them in assistance of fashion. In other words, we like to think that as a real-time agent assist, so guide them through the right steps so they don’t inadvertently step off the right regulatory path, but they can still provide the same level of service. If you were thinking about that context, where do you think a technology vendor should be focusing on? Are there other areas that you think are lacking in terms of their technology enablement? Or areas you think are a concern in your mind?
Tanushree: I think it’s probably a couple of things. I think one is, firms can make better use of data and analytics to look at conduct risk when it comes to selling to retail customers. In terms of assisting agents, I think what you said about guided conversation flows, information being much more readily accessible is key because I guess we’ve all seen places where agents are effectively going to the same internet pages as the consumer could to try and fish for information the same way, as a consumer. I think if you can make the agent’s job easier by having the information flows much more readily available, having the conversations effectively guided by technology and the right prompts come up, I think that would be key.
Ian: Yes. You mentioned data before, and the challenge in my mind of multiple channels and multiple data sources and multiple interactions, all occurring. Sometimes supporting the same customer who’s touched the digital channel, they might have gone into a branch. Now they’re talking to somebody in the contact centre, and we’re trying to understand what actually is that customer situation and are we supporting them appropriately? A huge challenge in my mind is, how do you get that end-to-end view of the customer? Whether, if it’s a vulnerable customer, for example, or a customer in hardship that we’re providing the right level of service.
How does a risk compliance professional see that challenge? Where are the issues there? It seems like a huge future opportunity for us, but I don’t think we’ve quite got our head around all these different data sets as yet.
Tanushree: That’s right. You raised an interesting point around vulnerable customers as well there. I think with customer vulnerability, it’s important to take a principles systems and controls view on it. Really, customer vulnerability should be embedded through every process in the organisation. Whereas oftentimes, it does end up being quite focused on something that the agents or the employees at the frontline need to be able to identify and detect. I will say that from conduct and just doing the right thing, customer vulnerability should be considered across the whole value chain.
From the point of a product is in the ideation stage to determining the pricing, to determining how you’re going to market it, what distribution channels you’re going to use, how you’re going to service that, what different mechanisms of service there are going to be, how you’re going to handle the complaints. Really, when it comes to customer vulnerability, I think it’s important that firms think much more deeply than simply training frontline staff and putting the onus back only on the frontline staff to identify vulnerability.
Ian: How do the firms think deeply though? I think challenge is, there’s so much unstructured data out there to generate insights from many organisations. Say they will go to the simple thing, as, “Well, how many phone calls did you get about mental illness?” Or, “How many calls did you get?” Rather than, as you say, understanding the customer journey and the various pain points that might be actually driving vulnerability or creating a more difficult situation for the vulnerable customer in the first place? To me, trying to get your head around all of the different insights and understand all of our structured data is a really key challenge for them.
Tanushree: Yes, that is. I think another aspect, the Financial Conduct Authority in the UK, the FCA, is considered, from a regulatory perspective anyway, one of the thought leaders when it comes to customer vulnerability. They’ve released a new guideline just in February of this year. When the senior executives of the FCA have been talking to that guideline and talking about customer vulnerability, a lot of what they have been saying is also around representation within the firms as well.
The people best placed to help provide solutions to how to address or look for, identify, customer vulnerability, generally speaking, you would think would be people that can relate to that demographic in some way. Important to just have those people in the room, weighing all that feedback in the room when firms are deciding the approach that they should take.
Ian: Okay. I’m interested in, as we talk about the different regulators and what’s happening overseas and around the world, there’s obviously a huge pace of change, I think, both in the technology space and emerging business models and so forth. What does that pace of change mean? Is it going to stop? How long does it keep going for? For an organisation, financial services in Australia, what does that mean for them in the future? What are the things they should be focusing on? What sort of things should they be doing now to get ready for those changes?
Tanushree: Yes. I don’t think the pace of change is going to stop. The specific regulatory change may slow down or may not, but I think there’s going to be enough other activity. Whether it’s learning from competitors, whether it’s enforcement activity, and just making sure you’re not going to end up in the same shoes, but I think organisations for a long time are going to feel the need to change, even if it’s not specifically regulatory-driven. I think what the last year has also taught us is that when a firm needs to, or even in our own lives when we need to, we can make really big changes organisationally to accommodate whatever the external factor is. In this case, the pandemic.
I think that’s going to play out in the way regulators approach consultation and transitions to regulatory change. Historically, there’s been quite lengthy consultation periods. Regulators have been quite open and receptive to also having transition periods. Say the regulation only coming into effect 12 months later, or 24 months later, I think with the industry showing that it can actually institute change very quickly, the ability to say during consultation, that, “Oh, we’re going to need two years,” or, “We’re going to need three years,” I don’t know that that’s going to be received the same way, but I also think that falls back on the regulator as well.
In the sense that, historically, we’ve seen examples of the regulator potentially identifying an area that had the potential for consumer harm. Going through quite a consultative process before they’re bringing in the actual changes, I think there’s now an onus on the regulator to also act faster when they do identify areas of risk or areas of potential harm. I don’t think the pace of change is slowing down anytime soon.
Ian: There’s also the pace of, as I say, reversing the change. I was fascinated that the governance are now suggested there might be changes in say, responsible lending guidelines and so forth, which I find fascinating. What we’re actually facing is almost teaching those organisations that have spent years trying to adhere to those guidelines. Then suddenly wind them back to some extent and change and manage that implementation the right way. To me, there is a place for, as you mentioned before, standardization of training and distribution of that information in a timely and consistent fashion across multiple touchpoints.
It’s also how do you change the mindsets of the people providing the right level of service and adhering to the right guidelines?
Tanushree: That’s interesting because that is a challenge. Especially when, as an organisation, you’ve invested a lot in trying to explain or justify a change then to reverse that. I don’t envy the people that have that challenge. I think when it comes to some of the potential weakening of regulation, that’s an interesting tension between a government that’s looking to stimulate economic growth and regulators that are focused on preventing consumer harm. I think there’s a place for organisations to think about the sustainability of what’s being proposed. Because we’ve been given reprieve, do we want to take full advantage of that or not? Or is there a middle ground that we play in?
I think in the end, for a product, service, whatever it is to be truly sustainable, there needs to be a long-term alignment of interest between the business as well as the end customer. I think there’s an opportunity for firms to really think about, “Well, to what extent do we want to wind back even though we are able to?” Yes.
Tanushree: Yes. Okay.