Listen to Your Customers
The correlation between patient satisfaction and medical malpractice risk has been extensively studied and is well understood and accepted in the health care environment.
Only a small number of patients with a valid legal claim ever file a medical malpractice suit. Conversely, a small percentage of physicians attract a disproportionate share of the suits that are filed, regardless of the validity of the complaint.
Many studies have shown that the volume and nature of unsolicited patient complaints about a physician are a strong predictor of that physician’s likelihood of being sued.
The nexus between customer complaints and risk goes beyond the health care industry.
Knowing this, many health care organizations, including my own, use patient satisfaction and patient complaint data as a risk management tool.
My organization contracts with a third party to analyze our patient complaint data; allowing us to identify, with a high degree of reliability, physicians at high risk of being sued for medical malpractice. If a high-risk physician is identified through this process, we attempt to mitigate that risk through a series of peer-to-peer interventions ranging from an awareness discussion, counseling, or potentially, a formal corrective action plan.
Through awareness, encouragement and coaching, physicians typically self-correct the behaviors that are causing friction with their patients and reduce their probability of being sued, thus lowering the cost of risk for the entire organization.
The nexus between customer complaints and risk goes beyond the health care industry, however.
In 2012, Toyota settled a class-action lawsuit alleging accelerator pedal defects for $1.1 billion. Customers had complained that the accelerator pedals were getting stuck and causing dangerous acceleration; eventually the resulting accidents led to tragedy and the inevitable lawsuits.
Following the downturn in the real estate market in 2009, Wells Fargo suspended or reduced customer home equity lines of credit in what they believed was commensurate with the reduced market values of the mortgaged properties.
Customers complained that their homes had not been properly reappraised and that the bank had not provided adequate notice of the credit line reductions, and eventually filed a class-action lawsuit that was settled in 2012.
There are many other examples too numerous to cite.
Risk managers in all industries should consider using customer satisfaction and customer complaint data as a proactive risk mitigation tool.
While we are all familiar with those chronically dissatisfied customers who will never be pleased despite our best efforts, trends or patterns in the nature of customer complaints and feedback can be a harbinger of bigger problems on the horizon.
Early identification and mitigation of these issues can potentially lessen the impact to the organization if they are adequately addressed.
As a risk manager, are you listening to what your customers are telling you about your organizational risk? If not, perhaps you should.