Five things high street banks can learn from NatWest’s handling of its “technical glitch” crisis
The problems for them, and the rest of the Royal Bank of Scotland banking group, started on the evening of the 19th when a standard upgrade to the software used by the bank for the batch scheduling of payments went wrong.
In the process of reversing the upgrade the schedule for the whole queue of payments – estimated to be in the millions – was wiped out. It took a further three days for the issues to be corrected during which time several million more transactions were not processed.
The following chaos resulted in thousands of workers not being paid; one man had to spend a night in prison as his bail payment wasn’t processed; a couple were left homeless after their house purchase fell through; and even customers of other banks were put in the position of worrying about black marks on their credit scores as a result of failed payments.
So what does this incident tell us about the way that banks should respond to managing crises and what lessons can be learnt for the way that banks keep their customers up to speed with a developing situation in the social age?
I think there are five key action points which banks can take from the past couple of weeks:
- 1. Communicate early, communicate often
- 2. Mind your language
- 3. The devil is in the (lack of) detail
- 4. Be social
- 5. Clicks still need bricks
Communicate early, communicate often
The first signs of trouble came on the morning of Wendesday 20th. At 5.14am a user of MoneySavingExpert.com posted in the forum:
Are there any other people experiencing difficulties with Natwest this morning?
An online chat advisor at Natwest told me that they were experiencing difficulties with credits due in and debits due out but they didn’t elaborate and when I tried to ask I was cut off from the chat.
I am wondering if anybody else had any more info.
People continued to post to the forum sporadically throughout the day but it wasn’t until the following morning that posts really escalated.
At 7.43am on 21st June NatWest posted their first update on the issue to their Twitter feed stating “Apologies our systems are experiencing some issues this morning. We are working hard to resolve these. AF”. A further update appeared about 2 hours later essentially restating the first message and was followed by messages approximately every hour throughout the day providing little further detail.
During this time the issue exploded online – especially on Twitter with customers venting their frustration. For many NatWest customers the first time they heard about any problems were when they were reported in the media, rather than in a communication from the bank.
Whilst it’s clear that it took some time for NatWest to understand what was going on and the scale of the issue the key lesson here is that when you first become aware of a problem be the one to communicate with your customers and demonstrate a level of ownership and reassurance about the issues.
Mind your language
The initial communications, with their vague statements of “technical issues” which hoped to “resolve within the next few hours” did little to reassure customers.
In a comment piece for The Guardian John Crace criticised the use of words like “inconvenience” and “glitch” in responding to the crisis:
An inconvenience is missing the bus and having to wait half an hour for another one. A glitch is when your computer crashes and you have to reboot it. Or your internet connection goes down. It is not a catastrophic failure that freezes the transfer of funds between accounts for nearly a week and has countless other knock-on effects. If the problem had been fixed by Friday night, RBS might have been able to pass it off as a glitch, albeit a very big one. As it is the company just looks casual and deluded.
I actually think that NatWest should be praised for some of the language they used, Stephen Hester, CEO of Royal Bank of Scotland, apologised on the Saturday night in pretty unequivocal terms:
Our customers rely on us day in and day out to get things right, and on this occasion we have let them down. This should not have happened.
The lesson here is that when addressing a problem make sure that the language you use matches the scale of the issue. Apologise yes, but also recognise the impact your mistakes have made on your customers’ lives, be clear about the steps you are taking to put things right and instil confidence that this won’t happen again.
And do it in the channels they use – so that means contacting them directly via email, making regular statements to the media, keeping your website up to date with information, SMS’ing those who use mobile banking services, posting in forums and responding to queries across the various social networks.
A good example of getting this right is when Susan Allen, director of customer services for RBS, took part in Q&A sessions with customers online.
The devil is in the (lack of) detail
Over a week on from the original problem we’re still somewhat in the dark about what actually went wrong.
Most of the media has resorted to piecing together the puzzle from internet speculation and former bank employees.
This lack of openness can reinforce a perception that the bank isn’t in control of the situation.
Writing for ZDNet UK, Jack Clark argues that banks should be more open about system outages:
…if you cannot access your money, or cannot pay a bill, you want to know why. Furthermore, your creditors want to know why. The less information you have, the more worried you are going to be — and the less certain that you can trust the bank in the future.
Clark goes on to suggest that banks could look to cloud computing pioneers such as Amazon Web Services who, despite having similar security concerns to banks, are much more open with technical data.
Another good example are Plusnet who provide detailed customer support statistics online so customers know how long they’re likely to have to wait on hold before their call is answered.
By providing detail about technical outages, including the steps they are taking and expected resolution times, customers can be reassured that their bank is taking an issue seriously and truly living up to its word of doing all it can to resolve it.
The banking sector as a whole has been very slow to embrace the social world but it’s in moments of crisis that it becomes clear how critical it is.
For many customers it’s the first place they’ll turn for information.
Perhaps more importantly, it’s also where the media look for information, and it’s the conversations that happen on Twitter, Facebook and other forums that can drive the news agenda.
One lighter moment in the crisis came when Natalie Westerman – who used the Twitter name @natwest – was inundated with queries from irate banking customers.
This shows the importance for banks to establish a social media profile before a crisis happens and then use that profile extensively to drive the narrative. As I’ve already noted, NatWest were slow to pick up on the story and failed in the early hours to use personal and reassuring language or to tweet often enough.
And whilst NatWest do not have an official Facebook banking profile, this didn’t stop some customers taking to the timeline of NatWest Cricket to vent their frustrations.
Rather than view social networks as a nuisance, where noisy customers go to let off steam, banks should be using them to control issues and take ownership of the story. Through the coordinated, personal and timely use of social channels – participating in conversations regardless of whether they happen on your own site or in a third party forum, banks can assert themselves as knowledgeable, responsive and in control before things get out of hand.
Clicks still need bricks
The final lesson of the crisis is the continuing importance of the branch network.
Whilst some commentators may be making the case for the death of branch banking one of NatWest’s most widely praised moves was the decision they took on 22nd June to extend branch opening hours into the evening as well as opening branches early in the morning and, for the first time ever, opening 1200 branches on a Sunday.
This shows that when the digital channel fails it’s incredibly powerful to have the physical branch network to fall back on to offer your customers reassurance that they can still get to their money. Which is something that most digital players simply can’t offer –if Google Mail were to fail you couldn’t go to your high street to collect your e-mail.
The key for the major high street banks is to continue to ensure that their branch network is an asset, not only in times of crisis, by delivering a properly integrated cross-channel experience allowing for seamless movement between the digital and physical worlds.
Molehills vs. Mountains
NatWest look likely to emerge from the crisis relatively unscathed but still with many questions to answer.
But the lessons in communication that they and the rest of the banking sector can take from the past few days should change the way they relate to their customers all of the time, especially in developing their social profiles.
In getting to grips with a problem early, communicating clearly and honestly with the right level of detail, and in taking an active role in conversations with customers in the channels they choose to use, banks can go a long way to resolving crises before they actually become a crisis.