Can the housing sector ever see residents as customers?
By Peter Watson, Director at ENGAGE Prop Tech
In this connected age, customers across all sectors expect more than they ever have before from the services they consume. For businesses this presents a challenge in meeting with ever-changing demands in order to secure long-term sustainability. This applies to the housing sector as much as it does to retail or entertainment.
Meeting customer demand
Today’s fastest growing companies are those that have embraced the changes brought by technology. Uber, Amazon and Netflix are prime examples of businesses which have thrown away the rule book on how to deliver service and built new models from the ground up – and with huge success.
Uber, which was founded just eight years ago, has become a global force that gives customers exactly what they want - great service which can be easily accessed and at a good price. It’s a simple formula but one that guarantees success.
Within the housing sector things have moved a little slower. Traditional landlord/tenant relationships still prevail, with landlords continuing to invest heavily in service centres and front of office staff. However, the emergence of the Private Rental Sector (PRS) has brought new players into property management and the impact has certainly been felt by many.
A subtle shift
One very subtle but incredibly important change that has been brought by these new players is the reference of tenants as customers. Until now the housing sector has been the only industry which hasn’t thought of itself as having ‘customers’.
A customer has the same expectations of service quality whether they are buying a washing machine, booking a flight or renting a flat – great service that can be easily accessed and at a good price.
Moving the industry to a new customer-centric service model may not be easy - but it is essential. It requires investment, vision and bravery. However, doing so doesn’t solely benefit the resident – but a landlord too. For instance, when you consider the calls from residents that come into a service centre, most are capable of being automated with minimal intervention needed from the landlord.
Taking routine maintenance as an example, it is perfectly possible for the customer to start the process online through a self-diagnostic system that will check the validity of the request and book a time slot. The process can then be automated with various checks and balances put in place. The customer themselves can then close the maintenance call and provide an Uber-style rating. This will help the landlord to further improve its service and also negotiate maintenance contracts.
Most importantly, if the maintenance process can be automated and put online, then over 90 per cent of calls that currently come into a call centre can be treated the same way – that’s a lot of time, and therefore money, being saved.
Property managers in the private sector are now starting to set targets of reducing costs by around 40 per cent within their service and administration centres. This is to be achieved by moving services online and letting the customers self-serve. From the surface this may sound like an ambitious target, but in reality it would be surprising if savings of 75 per cent aren’t achieved within five years.
However, because such targets can be achieved, that doesn’t mean it will be easy to do so. The transition has to be done properly and for many that means a complete step-change in incumbent practices. In a way, it’s easier for new companies such as Uber as it started with a clean sheet of paper. Meanwhile many in the housing sector have complex legacy systems already in place and masses of historical data that have to be dealt with.
Many Housing Associations have already invested in self-service. However, most are not seeing the returns on investment they had hoped for and have certainly not realised a 40 per cent reduction in administration costs. There are three main reasons for this.
Firstly, self-service is clearly beneficial to the landlord but what is in it for the customer? It’s easy to pick up the phone and call the service centre, so it’s essential the customer is motivated to use self-service. This major part of the service design is invariably forgotten, but if incentives aren’t provided, it will ultimately fail.
Secondly, self-service is usually incorporated into the corporate website amongst all the good news stories and announcements – quite irritating if someone hasn’t had hot water for three days. Then, the content isn’t personalised or relevant to the customer. If someone lives in Carter House, it’s only natural they want information, communications and service relevant to them and not generic information about the other twenty thousand homes their landlord manages throughout the UK.
Third, and finally, if substantial savings are to be realised, there’s no point in a maintenance request generating an email that lands in the service centre inbox. Processes must be automated and systems integrated to deliver a seamless service to the customer and achieve financial savings.
Reaping the rewards
So, can housing management services be radically changed to deliver the benefits to both the customer and landlord? Absolutely, yes. But certain considerations must be made at the outset.
It is very important to design service delivery from the ground up, ignoring all the constraints of IT systems, structures, people and so on. Once the vision is set, the job is to then map out the journey of just how it will be achieved. Tinkering around the edges, introducing bits of new technology, changing a few processes and working around the constraints of IT systems and people, will only lead to failure.
Government figures show that 89 per cent of UK households now have access to the internet, with 70 per cent of adults doing so through a smart phone. With this type of blanket access, there is no reason to hold back on redesigning services based on modern delivery principles. There will always be a need for telephone and face to face support for customers, but that should be minimised and targeted only towards those who need it.
The private sector perhaps sees more urgency in improving service delivery and cutting costs in order to create their brand within PRS. However the size of the social housing sector dictates that this is where the sea change in service delivery really needs to be made.
The opportunities are clearly substantial, but the risks involved in going down this road also need to be carefully managed. Housing associations and landlords must be bold when setting their vision and refuse to accept anything but a can-do attitude from suppliers, contractors or staff. Accept that this is a journey for the whole organisation and set KPIs that demonstrate the benefits as soon as they start to be realised.
Clearview are partnering with Engage Prop Tech to provide (housing management system independent) digital customer transaction and engagement portal solutions. If this is something you would like to discuss, please get in touch.