The Financial Conduct Authority (FCA) introduced its Consumer Duty standards to focus financial service providers on positive outcomes for their customers.

These new principles encourage companies to act with care for customer outcomes and to use a data-driven approach to understand what qualifies as a “Good Outcome”. They also make senior management functions and boards more accountable. The FCA’s deadlines for conforming to Consumer Duty principles ranged across 2023 and 2024.¹

As financial service providers work to put these principles into practice, they are searching for real and practical ways to prioritise and make change at pace, integrating Consumer Duty into their products, working practices and governance.

In this article we review insights from a recent transformation project. We look at the core elements of the Consumer Duty, how it affects financial services companies, and how they can include its principles as they design their products and services.

1. The Context

The FCA brought in Consumer Duty to improve the focus of financial services companies on doing what is best for their customers. All their available products and services had to achieve compliance by 31st July, 2023. The FCA allowed more time for products and services that are no longer available for sale, with a deadline of 31st July, 2024.¹² Companies had to act to understand good outcomes for customers, and to anticipate and mitigate risks of harm for their customers.

When companies first tried to pivot towards the Consumer Duty principles, they faced a few challenges. These included how to:

1. handle the scale of the change on the tight timeline,
2. set clear standards for what “Good Outcomes” are and to track performance,
3. equip the board and every level of the company to change the way they think and work, and
4. get ready to integrate these changes into their day-to-day business¹

Over the last two years, due to the FCA’s deadlines, companies have been working faster to include Consumer Duty in every interaction they have with customers.

2. The Brief

The client in this case study had to meet an FCA deadline by 31st July, 2024. We helped them prepare by applying our knowledge of the Consumer Duty principles to accelerate the work. Our human experience methods, aligned with Consumer Duty, allowed us to deliver at pace and enhance their own concepts along the way.

Putting human experience at the centre of the project and its methods was essential to success. Consumer Duty is not simply another regulation financial service providers must comply with. It aligns closely with the strategic decision to make the customer’s best interests central to how we design services for them. We used this alignment between the principles and caring for customers to shape our work, so it fits with what the FCA wants for the financial services industry.

3. The Project

To deliver, we mapped and developed customer journeys across various financial products, identifying and categorising any potential issues to build a prioritised catalogue of Consumer Duty actions. It proved essential to work together across different product and functional areas to establish a set of best practices based on Consumer Duty, which can apply to any customer journey.

Mapping the Full Set of Customer Journeys

Step one was to backlog and prioritise the journeys that were necessary to review. We prioritised against what the business wanted to achieve alongside the need to prevent problems for customers. We ran multiple group sessions led by our journey-mapping experts.

To make detailed maps of the whole customer journey, we used an inclusive way of working, building on what we learnt from the customer data. We involved external experts from both the UK and other countries, as well as people from the client’s internal team, to ensure a rich diversity of skills and perspectives.

Holding workshops virtually extended that inclusive approach to fit in with different time zones and working patterns, harnessing thought leadership in different topics from several countries.

In the same spirit, we used online tools for journey mapping that permitted all contributors to collaborate, make changes, comment, and keep track of different versions at the same time. This way of doing things helped us track progress, make smart choices, and ensure each map gave a comprehensive view of the customer’s experience.

This effort developed a full set of Customer Journey Maps. These maps did not just show the important times when customers might have problems, but they also highlighted the exact moments where customers could get stuck or frustrated, both in each step and throughout the end-to-end process.

Reviewing the FCA’s Good Outcome Categories

Drawing on FCA policy statements and guidance, EY created and applied “Good Outcome” analysis for customers across the end-to-end journey:¹²

1. The products and services outcome: Making sure that products and services for customers are suitable for their needs, created for the right group of customers, and distributed to make sure they work well for everyone.
2. The price and value outcome: Making sure customers get a fair deal by checking that the benefits they get from products and services are worth what they pay.
3. The consumer understanding outcome: Working to make sure companies give clear, timely, and easy-to-understand information so that customers can make smart choices about their money.
4. The consumer support outcome: Expecting companies to provide customer service that helps people with what they need, making sure they get the most out of their financial products and can meet their money goals.

We reviewed the four “Good Outcome” categories. It was important to understand how each step of a customer’s experience has different goals, which might fit better with certain types of categories. For example, when a new customer joins a bank, it is more about the consumer understanding outcome, ensuring they understand everything they read and hear. However, when an insurance company helps a customer after a car accident, it is more about the “consumer support” outcome, providing them with the support they need during this stressful moment.

Our team did a detailed check with the help of Consumer Duty analysts to confirm how we apply the FCA “Good Outcome” categories and determine where they become most important for the customer steps we were looking at. When making our choice, we thought about which goals would really help with the main aims of the customer journey maps as well as how we could enhance each customer’s experience, all while following the principles.

Assessing the Customer Journey Maps against the FCA’s Good Outcome Categories

To fully understand what customers go through, we did a gap analysis based on the selected “Good Outcome” categories. We gathered all the potential problem areas we found in the Customer Journey Maps and looked at them together to see where customers might need more support. It proved vital to assess both frequency and severity, for each potential pain point.

Our structured way of working helped us find common pain points that showed up in different journey maps. By thinking about each problem as part of the whole customer experience, we could decide which issues were most important and prioritise solving them according to the impact they would have on customer experience and on their financial outcomes. We could then focus on these key issues to prioritise improvements.

We connected each step of the customer’s journey to a clear goal, linked to the Consumer Duty principles. We could then display performance against these goals on data dashboards. In this way, we aligned to the work of our Data team, helping their effort to regularly monitor data to make the customer’s experience better. By doing this, we made sure that our work was based on real-world evidence, focused on the Consumer Duty principles.

4. The Key Takeaways

As human experience designers working in regulated industries, we have uniquely relevant skills to help companies meet their Consumer Duty by ensuring they have their customers’ needs and best interests properly understood and built into their processes.

Insights arising include:

• The FCA’s Consumer Duty pushes us to not only meet Consumer Duty standards but to bring the principles to life and help customers make great financial choices. Our approach to human-centred design is critical to interpreting and implementing Consumer Duty. By centring our design around the customer’s needs and experiences, we can not only ensure compliance but also empower customers to make informed and beneficial financial decisions. Our dedication to this approach accelerates our ability to deliver products and services, and helps to foster trust and fair outcomes.
• Designers can use principles that focus on the customer to meet the FCA’s Consumer Duty guidance and improve how companies currently work. Our job was to connect the specific needs of customers with the broad principles from regulators, making sure that every service not only avoids harming customers but also brings positive results. We did this by applying customer-focused approaches to turn principles into real, helpful experiences for customers. This means considering design, business, and technology, while deeply understanding both the regulations and how customers interact with services.
• Working together with specialists in Consumer Duty is crucial for doing things right. From the start, we expected to learn more detail as we explored the regulations. Working with Consumer Duty experts helped us ensure we would meet the FCA’s goals. This work also taught us that looking after the interests of consumers is about more than just following the principles – it is a key part of running a business fairly.
• Even small actions can build up and cause serious problems for customers. It became clear that even trivial things can add up and result in big issues for customers who buy goods and services. The Consumer Duty sets a high standard of care that companies must follow. Although most businesses support this idea in principle, putting it into practice can be difficult. The first thing they need to do is to see how they might be causing problems without realising it. It is especially important to realise that little issues can grow into bigger ones, causing a lot of stress and trouble for customers.
• Clear and consistent language is essential to prevent confusion. Our research demonstrated how vital it is to speak clearly and accurately to make sure everyone involved understands each other. For instance, we need to clearly separate out small but significant issues that customers face such as confusing product features, unclear fees, and poor support. These can lead to bad choices and loss of trust. When we do not communicate clearly, it can harm customers. That is why companies must use language that focuses on the customer, to help understand them better and protect their interests.
• Coaching is critical for firms to uphold their Consumer Duty in the long-term: it is vital that firms can independently refine user journeys after building them. We worked hard to train the client teams and empower them with the skills to sustain and evolve design processes whilst confidently navigating their products’ complexities. Our aim was to build a culture of innovation and empathy, making initiatives responsive to the firm’s business and customer needs, ensuring a lasting impact beyond our project’s completion. We ensured we brought in coaching into our hand-over, fostering a mindset of continuous improvement and customer at the centre. This collaborative coaching covered user journey mapping, pain point analysis and how to implement solutions.

5. Recommended Approach

Based on our work, we have identified a series of steps outlining a best-in-class approach for identifying consumer harm within customer journeys, including how to spot and help to solve it:

1. Identify priority customer journeys and review FCA’s Good Outcome Categories
   1. Examine the four “Good Outcomes” as defined by the FCA: suitability of products and services, fair pricing and value, clear customer communication, and supportive customer service.
   2. Determine which customer journey maps to develop first, based on business objectives and the need to prevent challenging customer issues.
   3. Understand how different stages of the customer journey align with different “Good Outcome” categories and tailor the focus accordingly.
2. Organise expert-led group sessions to develop customer journey maps
   1. Conduct multiple sessions with journey mapping experts to guide the mapping process, utilising customer data and involve a diverse group of external and internal experts from various locations to include a range of skills and perspectives.
   2. Hold workshops in a format that accommodates participants from different time zones and work schedules, allowing for broad involvement.
   3. In these sessions, encourage the use of digital tools that enable simultaneous editing, commenting, and version tracking to foster collaboration and monitor progress.
   4. This results in detailed maps that not only identify areas of consumer harm but also pinpoint specific moments of customer frustration throughout the journey.
3. Perform a Gap Analysis
   1. Perform a gap analysis using the FCA’s “Good Outcome” categories to identify and assess customer harms found in the journey maps and prioritise the key issues.
   2. Identify recurring problems across journey maps and prioritise them based on their impact on customer experience, and the harm caused to customers.
4. Improve and monitor customer experience
   1. Refine the service by implementing specific solutions for the identified customer harm issues, ensuring that enhancements are directly addressing the root causes of consumer dissatisfaction and fostering a more positive customer journey.
   2. Collaborate with the Data team to regularly review data and make informed improvements to the customer experience in line with the Consumer Duty objectives.

6. Conclusion

Our job as designers is to turn the FCA’s broad principles into real, positive experiences for customers. We must carefully mix design, business, and technology, and we need to know a lot about both the principles and what customers need. By working together and reviewing our work often, we can make sense of complicated principles and use them to guide us. This way, we make sure that the services we create not only prevent problems for customers but also help to make sure that customers always have positive experiences.

This case study shows clearly how we as designers can successfully turn Consumer Duty policies into practical actions that can really make a difference to the customers of this financial services client.

We understand that the FCA’s Consumer Duty guidelines will keep having a significant impact on companies in the financial services industry. That is why it is crucial for us as designers to take lessons from our past work to make our upcoming projects even more customer-focused. From this case study, we have gained valuable knowledge that we are excited to apply moving forward.

• The FCA’s Consumer Duty pushes us to create outstanding products and services for customers.
• Designers can use principles that focus on the customer to meet the FCA’s Consumer Duty guidance and improve how companies currently work.
• Working together with specialists in Consumer Duty is crucial for doing things right and ethically.
• Even small actions can build up and cause serious problems for customers.
• It is crucial to use clear and consistent language to prevent confusion.
• Coaching is critical for firms to maintain the integration of Consumer Duty in the long-term.

If you would like to learn about the importance of design in regulated industries, see Leading Design Works – the report of a unique research collaboration between the RCA’s Service Design school and EY Seren.³