The New York Times best-selling author Deepak Chopra once said:

?In my life nothing goes wrong. When things [do not] meet my expectations, I let go of how I think things should be. It's a matter of not having any attachment to a fixed outcome.?

Now while Deepak may have written over 90 books on alternative medicine and meditated with TV's Oprah Winfrey, his position on outcomes shows that he has probably never opened his third-eye to the FCA's own ?best seller? on vulnerability: FG21/3.  

This is because the FCA takes a quite different approach than Deepak to financial life, with an unwavering attachment to ensuring that ?[vulnerable consumers] experience outcomes that are as good as those of other consumers?.

But what does this all mean? What is an outcome? Why is the FCA so attached to them?  And which ones should firms measure (and how)?

Outcome gurus

In our most recent podcast, our own panel of gurus took on these questions and explained that outcomes are all about change. At its simplest, this involves a firm taking an action (such as making a gambling block available on debit cards) and seeing if a change happened (the customer turns on the block), or no change happened (the customer does not turn it on).

These changes don't just have to be about gambling blocks. Whatever the outcome measure being considered, the logic remains the same: (i) did a change take place (or not) that flowed from (ii) a specific action being taken by a firm?

Attached at the hip

If outcomes are all about change, what type of changes does the FCA want firms to measure?

Our podcast panellists identified a number of potential outcome measures (which you can listen to here), including the suggestion that firms start by reviewing the ?big six? outcomes introduced by the Financial Services Authority (the pre-cursor to the FCA) back in 2006 as part of Treating Customers Fairly (TCF).

While these outcomes are now 15 years old, the FCA still sees these six outcomes as being at the ?core of what we expect of firms for all consumers, including vulnerable consumers?.

Every firm should review and refresh its memories of the TCF ?big six?:

1. Consumers can be confident they are dealing with firms where the fair treatment of customers is central.
2. Products and services are designed to meet the needs of identified groups and are targeted accordingly.
3. Consumers are provided with clear information and kept informed before, during and after point of sale.
4. Where consumers receive advice, this is suitable and takes account of their circumstances.
5. Products perform as consumers expect, and the service is of an acceptable [and expected] standard.
6. Consumers do not face unreasonable post-sale barriers to change product, switch provider, submit a claim or make a complaint.

Measuring sticks

The outcomes described above provide a starting point for firms, but not the last word. Panellists were clear that firms needed other data, including information that described a firm's vulnerable customer base and target market.

Without this information - and without a firm understanding the scale and nature of vulnerability among their customers, and their support needs - it becomes impossible for firms to measure whether their vulnerable consumers actually do (or don't) ?experience outcomes that are as good as those of other consumers?.

If firms lack this data, they won't know which of their consumers are actually ?vulnerable?. Nor would they be able to distinguish between different forms of vulnerability. This would make it almost impossible to establish if vulnerable customers experience ?as good? outcomes as other consumers. For this reason, every firm needs its own ?measuring stick? for vulnerability - one which has its outcome measures inscribed on one side, and its customer vulnerability profile on the other.

In order to achieve the best outcome for all we need to understand that outcomes are about change, that the FCA carries at least six core TCF outcomes and that every firm needs a two-sided measuring stick to ensure that vulnerable customer outcomes are as good as those for other customers.

The next cohort of UK Finance's award-winning Vulnerability Academy, in partnership with the Money Advice Trust, opens on 2 September. Learn more and register here: Vulnerability Academy Sep 2021