During my many years handling and advising on professional indemnity insurance, I have witnessed first-hand the correlation between how a law firm handles complaints and the ease with which it can obtain professional indemnity insurance at a reasonable price.
You may initially find this a strange statement. Law firms do not need to notify every complaint they receive, otherwise chaos would ensue! Complaints fall into many different categories and the majority would not necessarily fall within the definition of a notifiable claim or a notifiable circumstance that could lead to a potential claim.
However, if firms do not manage and monitor their complaints properly when they first arise key indicators of increased risk could be missed, leading to avoidable claims in the future. I have seen on several occasions multiple claims stemming from a systematic error or a service failure from a specific department or work emanating from one individual. These claims could have been avoided if there had been closer monitoring of initial complaints or if procedures had been in place to review service standards and closed files.
Firms can adopt service standard tests to help reduce the number of complaints and identify weaknesses in their customer care and practice procedures. Many industries test their customer service skills by employing mystery shopper techniques. Such techniques can also be usefully deployed in the professional sector, including legal services, as Sue Bramall of Berners Marketing explains.
‘Mystery shopping is a management tool which is used in a wide variety of businesses as part of a strategy of continuous improvement. Generally, it is used to test how well an organisation handles initial enquiries. Given how much a law firm may spend on marketing, it is a useful way to ensure that every enquiry that your firm receives has the best chance of conversion to an instruction’, says Sue.
Each enquiry tests over 100 aspects of the client experience, including listening skills, empathy, communication, information capture, pricing, explanation of risk and timeframe and whether there is any follow up. Consequently, the depth of information captured also provides some valuable insight regarding weaknesses in client care which might lead to future complaints.
For the year 2015/16 the Legal Ombudsman dealt with 7035 complaints regarding law firms, with the following reasons:
Nearly one in five complaints relate to costs, with the biggest problem being a failure to give costs information and to thereafter manage clients’ expectations. It is not necessarily the case that the costs charged are wrong or even that they represent poor value; very often the issue stems from the fact that clients are not given adequate information on costs at the outset and are not then advised as costs mount up.
This is no surprise when you look at the results of any mystery shopping exercise for legal services. I have seen many emails which say little more than “Mr X’s hourly rate is £... Please call if you would like to proceed.” This approach almost invites complaints. While quoting for legal work is not always easy there are ways in which information about costs can be presented to help clients understand the basis of charging and so reduce the risk of a complaint down the line.
Poor communications are behind many of the complaints, with clients becoming increasingly frustrated. Mystery shopping often highlights an appalling lack of care in collecting accurate contact data for clients (spelling of name, preferred salutation, email address, mobile phone number, preferred means of communication, hours of availability). Information is not always passed on, calls are not returned and enquirers rarely followed up. And this is before work
has even started on the matter! Managing partners often know which solicitors are not meeting the highest standards of client care, and mystery shopping provides some very useful evidence for use in performance management.
It is important to see mystery shopping as a positive activity which helps a rm to identify ways to gain a competitive advantage. The happiest clients make the best referrers of new clients. Mystery shopping highlights where poor practices exist so that management can take steps to improve policies and procedures, address technical issues and plan for the training and coaching of staff. While the primary objective is usually to increase the percentage of enquiries which convert to instructions, these improvements will also reduce the risk of complaints.
James Brindley and Sue Bramall
For TLO Risk – April 2017
Sue Bramall is Managing Director of Berners Marketing and a member of the Law Consultancy Network. @Berners4Law www.bernersmarketing.com
James Brindley is a PI Account Executive at TLO Risk Services LTD www.tlorisk.com