The University of Newcastle, Australia

New Phase of Research Investigates Complaints Management in Public Organisations

Thursday, 13 June 2019

The second phase of ground-breaking research into measuring the return on investment (ROI) on effective customer complaints management has begun.

Complaints Management

The new UON study will investigate public organisations and will provide benefits to government organisations as well as the ombudsman sector by indicating how public organisations can measure the benefits of effective complaint handling.

In the first phase of the research, Professor Tania Sourdin (Newcastle Law School), Dr Jamie Carlson (Newcastle Business School), Emeritus Professor Martin Watts, and Ms Christine Armstrong (PhD Candidate) found that ROI in complaint handling in private organisations can be as high as 1000%.

This research discovered the potential financial returns of handling complaints well, while also demonstrating that ineffective complaints handling can result in significant losses for an organisation.

It was identified that the greatest returns are generated through ‘extended benefits’, including: customer retention, staff satisfaction and customer lifetime value, as well as product improvements made as a result of feedback. Through these ‘extended benefits’ the potential returns of effective complaints handling are higher than previously thought.

“This research made an important first step in delivering a framework to assist organisations to verify once and for all that complaint departments are not merely ‘cost centres’,” said University of Newcastle’s Professor Tania Sourdin.

The second phase of the research has been commissioned as there are major differences between public and private organisations that impact consumer behaviour.

Customers usually the have the option of exiting from their commercial relationships with private sector organisations, this is typically not possible when a public sector organisation is involved. This distinction motivated the development of a study focused on public sector organisations.

Both phases of the research have been commissioned by SOCAP Australia (The Society of Consumer Affairs Professionals Australia).

A report summary of the first phase of the research can be found here.

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