UK Press Slams Vodafone Billing Mess

I often talk about the ways operational mistakes can lead to reputational damage. However, I recognize that it is hard to show examples of how the two are connected, and even harder to evaluate the damage that is done. There is no simple correlation between the extent to which a telco screws up and the impact on its reputation. A telco may make one mistake without annoying anybody but the customer who suffers as a result. The telco may make two mistakes affecting two customers, three mistakes that impact three customers… but eventually there comes a time when so many mistakes are made that many more customers learn of the telco’s incompetence. That is why it is worth exploring the recent press coverage given to Vodafone UK, whose long-standing billing issues have finally be considered worthy of more extensive press scrutiny.

The tipping point for Vodafone came when a BBC headline reported:

Complaints about Vodafone rocket in UK

The BBC’s story was rather tame, and was driven by the startling rise in the number of complaints the regulator had received from customers. The BBC’s reporter casually reproduced Vodafone’s lame excuse – “an IT glitch” – without questioning how a glitch can be responsible for a surge of complaints that started well over a year ago. Furthermore, the BBC repeated all of Vodafone’s pathetic attempts to play down the fiasco.

“The points highlighted in this report largely relate to a major programme we undertook last year to transfer customers on to a new billing system, aimed at simplifying the operation of their accounts and opening up a range of better services, such as ‘click and collect’,” said a spokeswoman.

“Unfortunately, there were some problems during the highly complex migration. Now that the migration exercise is essentially complete, we expect our £2bn investment in our network and services will start to deliver a step change in customer experience.”

In short, Vodafone have treated customers badly but used the BBC’s coverage as an excuse to present an advert for their ‘£2bn investment’ in ‘better services’. Maybe it did not occur to Vodafone that their excuses should have been prefaced with a simple apology for incompetently managing their ‘highly complex migration’.

Whilst the BBC’s story lacked bite, it did set wheels in motion. Clearly the average journalist learns about news stories the same way the rest of us do – by reading what other journalists have reported. As a consequence, the fact that the BBC noticed the regulator’s complaints figures led other news outlets to run similar stories a few days later. However, those other hacks did not repeat the BBC’s laid-back tone.

The Register mostly copied the BBC’s version of the story, but adopted a more damning headline that mentioned the mood of Vodafone subscribers:

Angry Vodafone customers spark Ofcom probe after phone bill overcharge snafu

National newspaper The Telegraph ran a more extensive article that suggested they were ‘exposing’ the truth about Vodafone:

Exposed: How Vodafone is messing up customers’ bills

The Telegraph used the story to then print a series of anecdotal stories from dissatisfied Vodafone customers, saying Vodafone’s problems ‘came as no surprise’ because…

…our inbox has also been brimming with Vodafone billing complaints.

But the worst coverage has come from This is Money, the very popular personal finance and consumer protection offshoot of national newspaper The Daily Mail. Since the BBC reported on Vodafone billing complaints This is Money have responded by pushing a string of negative stories:

Meltdown at Vodafone: Bungled bills, call centres driving you mad, letters ignored all caused by – surprise, surprise – a massive computer failure

Vodafone customer paid £1,000 to cancel her mobile contract – but the firm STILL wouldn’t let her go

Will Vodafone EVER get its customer service act together? Pigs might fly before it manages to improve

This is Money also confirmed the theory that bad press for one telco can lead to reputational harm for other telcos. Their evisceration of Vodafone was followed by an article that began with this headline:

Rotten service, soaring prices and shock bills… Is it time to ditch the mobile phone giants?

If you think the headlines about Vodafone are bad, then take a look at some of the content in the articles:

Customers are spending hours on the phone to its call centre, passed from pillar to post, only to find they’re no closer to getting a refund. After making numerous complaints, many are at their wits’ end. We’ve passed a dossier containing dozens of unsolved gripes — many of them about simple blunders — to Vodafone and industry watchdog Ofcom, which has launched an official inquiry.

Our investigation found customers were:

  • BILLED for phone lines they didn’t have — and never received a refund.
  • UNABLE to get money back after fraudsters bought phones in their names.
  • LEFT out of pocket for pricey calls they had never made.
  • FORCED to spend up to 50 hours on the phone to fix basic problems.
  • IGNORED by Vodafone — even when they had sent multiple letters.
  • GIVEN conflicting information by different call centre staff.

Laura, 36, says: ‘Not only is this causing a lot of stress but it is affecting my credit rating and I am seriously fed up with Vodafone’s inability to cancel a contract properly – especially when we have done exactly what was asked of us and I haven’t used the phone for over a year.’

Vodafone has been forced to hire 600 extra call centre staff to cope with a customer service meltdown. Last week, Money Mail exposed how a computer system overhaul meant Vodafone customers were unable to get basic errors fixed.

…the mantle for worst customer service provider of all (the wicked witch) must surely go to Vodafone. For the past ten months, The Mail on Sunday has winced at the inept way this phone giant deals with problems.

All companies – even those renowned for stellar service such as First Direct, Nationwide Building Society and Metro Bank – make mistakes. Most then go out of their way to resolve them, thereby repairing any reputational damage.

But not Vodafone. It makes mistakes and then perpetuates them. Rather than righting a wrong, it digs a hole for itself – and then keeps digging.

Not everything the press reports is accurate. Bizarrely the Telegraph stated that UK comms regulator Ofcom…

…is so concerned about Vodafone that it has launched a formal investigation scrutinising whether customers’ bills represent exactly what services they have had, as well as how customer complaints have been handled.

This is incorrect. Ofcom actually closed its investigation into Vodafone billing errors without taking any action, and before the most recent run of bad press instigated by the BBC. Only the regulatory investigation of Vodafone’s complaints handling remains open. However, the Telegraph is not alone in having an optimistic view of Ofcom’s diligence. This is what Jeff Prestridge wrote for the Mail on Sunday:

It’s not good enough. It’s not fair – and it can only be a matter of time before the company is given a multi-million pound fine by its regulator Ofcom.

Telecoms professionals with experience of UK billing accuracy regulations face many uncertainties when trying to work out if they have complied or not. However, they all know that ‘multi-million pound’ finds are not something they need to worry about. Ofcom talks big to telcos but plays down issues in public because the regulator does not want to draw attention to its own incompetence – which includes a regulatory audit regime that has approved the accuracy of Vodafone bills for well over a decade.

But what really matters is not whether the press gets every detail correct when presenting a story, but whether the press notices a story in the first place. Clearly the British press is now conscious of Vodafone’s failure in ways they were not previously. That means any customers who contacts the press are likely to receive a more sympathetic and interested hearing than before, and every failure by Vodafone is more likely to lead to another negative headline. In turn, more and more customers will be conscious of Vodafone’s failures, even if they are subscribers to another network.

None of us possess a surefire way to value the impact of this press coverage on Vodafone’s reputation, but we can all agree that the impact is real and will extend beyond the customers who suffered directly from Vodafone’s failures. Whilst Ofcom use coy language to describe the complaints they have received, the press has used words that make the situation clear: ‘billing bungling’, ‘blundering’, ‘meltdown’, ‘shoddy’… the reputation of Vodafone’s management team has finally taken the bruising that their complacency deserved.

Let me finish with some more words from Jeff Prestridge of the Mail on Sunday, and a question for you. Would you want to read the following about your telco?

Will Vodafone ever get its customer service act together? Maybe in time (maybe pigs will fly as well) although it’s probably too big, too beholden to its shareholders and too short term in its mind-set to ever take customer service as seriously as those providers that have fairness coursing through their veins.

…Vodafone doesn’t even know the meaning of the word fairness.

Eric Priezkalns
Eric Priezkalns
Eric is the Editor of Commsrisk. Look here for more about the history of Commsrisk and the role played by Eric.

Eric is also the Chief Executive of the Risk & Assurance Group (RAG), a global association of professionals working in risk management and business assurance for communications providers.

Previously Eric was Director of Risk Management for Qatar Telecom and he has worked with Cable & Wireless, T‑Mobile, Sky, Worldcom and other telcos. He was lead author of Revenue Assurance: Expert Opinions for Communications Providers, published by CRC Press. He is a qualified chartered accountant, with degrees in information systems, and in mathematics and philosophy.

1 Comment on "UK Press Slams Vodafone Billing Mess"

  1. Avatar Mark Yelland | 21 Apr 2016 at 4:12 pm |

    Pleased to read that at least someone is interested in protecting customers from shoddy service and poor billing practices.

    Vodafone is not the first operator to introduce a new billing system, and it will not be the last. Others have achieved better success but not without problems, so it may be worthwhile to look at the driving factors behind such a poor migration for any lessons learnt.

    As we all know, IT projects are extremely complex, rarely properly spec’d at the beginning and once the project runs late, the first thing that gets dropped is the testing and then the actual project gets de-scoped as a means of keeping the escalating costs down. I wonder how many RA teams have had their requirements dropped from phase 1 and put into phase 2 or 3 (which is never funded). Meanwhile, the project team achieves its bonus for implementing something (anything) on time (which could be as much as six months late !).

    What lessons are there from this seeming debacle?

    1. Where was the on-going risk assessment of the design and implementation to ensure that as the environment changed, and new risks identified, they were correctly categorised and considered? None of the statements above come as a surprise to someone who has been involved in implementing new billing systems.

    2. Was management aware of the problems with the implementation and chose to ignore it (poor decision making) or not aware because those lower down elected to hide the problems (poor management, reporting and whistle blowing procedures)? I suspect this is different in different organisations.

    3. What were the key success factors for the project and were they in keeping with the overall success factors for the business (and were they actually defined and measured)? Aligning objectives is a fundamental requirement for good governance, so something is not consistent.

    Although the article is about Vodafone, we cannot change history, all we can do is try to learn from it. I believe someone once said “those who do not learn from history are doomed to repeat it”. Just make sure it is not you.

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