The opportunity to talk to Betsy and gain the breadth of her cross-sectoral experience through he reflections from both inside and outside the housing sector offers an interesting perspective to customer engagement and operational performance. Her insights demonstrate the synergies that exist across many sectors and reinforces her belief that more organisations should try to look outside their own areas to see the bigger picture.
As a Non-Executive Director of L&Q, what would you identify as the core challenges and areas of focus for the social housing sector?
I would start by saying that the shortage of affordable housing is the core challenge for the sector. That is why I am really proud to be part of an organisation like L&Q which has set such high ambitions for new development. We aim to build 100,000 new homes over the next ten years. At the same time, I strongly believe that investment in development shouldn’t come at the expense of investing in our existing homes and providing high quality services to our residents. There again, I think L&Q performs well against industry benchmarks, with customer satisfaction of over 70 per cent. I still think that there is room for improvement: we don’t always get things right and acknowledging that is essential in order to learn and continuously improve.
As Chair of the Customer Experience Committee, I feel very strongly committed to the ambitions of the organisation as it strives to provide more consistent, high-quality customer services and to ensure that we get the right mix of investment in new affordable homes and investment in our existing estate. Striking that balance is one of the key strategic challenges facing the sector at the moment.
Your sector perspective is broad across commercial, government and housing, and you will soon take on a substantial Chief Executive role within the health sector. Do you see any synergy in the challenges facing the housing sector compared to those across other sectors?
Absolutely. Poor quality housing has a detrimental impact on health and wellbeing. I saw one figure that said that poor quality housing costs the NHS £600 million a year. Regardless of the exact figure, there is clearly a strong link between the two. The work we do in the housing sector has a direct link to the demands placed on the NHS. Equally, cuts in local government funding can have a knock-on impact on public services that are available to support vulnerable people in our local communities. That leaves L&Q and other housing associations to try and pick up the slack, less there be a negative impact on rent arrears, anti-social behaviour or the like.
I don’t think these are new insights. It is simply a recognition that organisations and sectors don’t work in a bubble but are part of much larger, more complex systems.
One of the things that I really loved about my time in the civil service these last four and a half years was learning a lot more about systems thinking and watching my policy colleagues take cross-sectoral impacts into account when developing new policies and programmes. That was something that I really didn’t have to consider when I was working in the private sector.
Policy aside, I think there are lots of synergies and similar challenges on the operational side that face different sectors, such as health and safety, logistics, customer service, digital, etc. I have really enjoyed applying skills gained during the 15 years I was in the energy sector to the roles I have had in the civil service and as a non-exec in social housing. I think in many respects the business models in the social housing and energy sectors are very similar. The cashflow that is made downstream – whether that is delivering energy or housing services to customers – is used to fund investments upstream. By that I mean new housing, new power generation or gas production assets. Given the very emotive nature of energy and housing, good customer service and value for money are critical. You get these elements wrong and you lose public trust. You lose public trust and you start to see government and regulatory intervention.
That is a rather long-winded way of saying that I think yes, there are lots of parallels and synergies facing energy and housing sectors and I am sure I will find a similar thing when I move into health, which is of course another critical, and therefore emotionally charged sector.
Do you think there is enough partnership working being undertaken?
I see many organisations working together up and down the supply chain where there is an obvious need for partnership. I referred earlier to some of the areas where you do see partnership between health, local authorities, and social services because of the obvious knock-on impacts between them. Could people do more though? I am sure the answer has to be yes. I guess that is both at the macro policy level and at the micro level with individual organisations working with others, particularly in the same local area.
It is a very good question because [partnership] is almost counter-cultural for many organisations. A lot of the incentives for many organisations are about looking internally and optimising their particular silo. Even within individual organisations, you often see fiefdoms. One of the greatest challenges for any leader is getting people to step back from their individual part of the organisation and see the bigger picture. This is often key to establishing opportunities to drive better value, whether that is through improved outcomes, customer services, or improved productivity across an organisation. This is hard enough for a single organisation to do, let alone looking outside the organisation and spotting the opportunities and forging the alliances that will work.
I absolutely think it is the role of all leaders to highlight these opportunities and put in place incentives to encourage that kind of working.
From your current and previous experience, how do you consider the relationship between organisational culture and customer-engagement? What are some of the things that leaders can do to shape a culture that supports customer-centricity?
I think this is a particularly relevant question for the public sector where, unlike the private sector, our customers can’t vote with their feet if service is poor. After all, if I’m not happy with the service at Tesco, I can just go down the street to Sainsbury’s. Or if a British Gas engineer disappoints me, I can take my custom to HomeServe or a local contractor.
This threat of competitor loss – or conversely the incentive to win new customers – tends to focus the mind in the private sector and drive a customer-centric culture where people are obsessed with customer insight, product or service development, and innovation. I think this is difficult to recreate in the public sector or in social housing because that competitive dynamic just isn’t there. Customers or users often don’t have a choice and so have to put up with the service no matter how bad it is.
Having said that, I think there is a lot that leaders in this sector can do to avoid complacency when it comes to customer service. Much of it comes down to organisational culture, in terms of what is valued and what is not. When I joined the L&Q board, customer service matters were delegated to the executive. When I asked why we didn’t discuss it at board, I was told that the board only discussed strategic matters. I thought that very odd as I had always viewed customers as one of the biggest strategic issues facing any organisation.
I’m happy to say that customer experience is now very much considered by the board on a regular basis and it is afforded the same level of importance as development and audit and risk in that we have created a stand-alone sub-committee to scrutinise performance: our Customer Experience Committee. I don’t want that to say that customer experience wasn’t important or taken seriously before, because the organisation had lots of executive and operational focus on customer experience. I also don’t want to suggest that everything is rosy now. But I would like to believe that the creation of this committee sends a clear message to residents and staff alike about the level of importance that we place on customer experience.
Looking at my time at DEFRA, customer experience was also a big theme for me. However, with my responsibility for corporate services, my focus was on the internal customer experience rather than external customers or users. I spent a lot of time out and about talking to staff and I found that people shared a common sense of pride and passion for the department. I did however also discover that they shared common frustrations. I was already leading a programme to transform corporate services, but that was primarily focused on cost-reduction so I decided to launch a programme called ‘Smarter ways of working’. This was designed to address staff pain points and make DEFRA a better place to work – essentially putting the staff in the position of the customer. It brought a different lens to our work by looking at our service from the viewpoint of our staff. I believe that as a leader it is so important to amplify the voice of the customer, whether internal or external. I think the more you amplify the voice of the customer, the greater the need to galvanise the organisation to understand and address their unmet needs.
It will be very interesting as I go into NHSBT to understand what some of those unmet customer needs are, both internally and externally. I look forward to harnessing the expertise already there and bringing in a fresh pair of eyes to move the organisation forward positively.
What levers do you think leaders have to ensure an organisation looks broadly for mutually beneficial partnerships and operates as part of an ecosystem? How can they help prevent an organisation or a sector from being inward-looking?
One of the key responsibilities of any leader is to bring the outside in. By that I mean developing relationships outside their organisation to ensure they understand the external influences that could have an impact, either positive or negative, on the organisation.
The reason I talk about bringing the outside in is that the modern world is a demanding and chaotic place. It is often difficult for busy people who are focused on internal goals to step back from the day-to-day and adapt their mindset to consider new developments, opportunities or ways of working. In competitive sectors, new entrants can disrupt markets because they aren’t focused on internal legacy operations but have the luxury of reimagining the way the world works. They can more easily look through the lens of customer experience and emerging new technologies to meet pain points.
It is important then that leaders guard against this risk of becoming too internally focused. I think traditionally, leaders have relied on their strategy, business development or external marketing and media relations teams to bring the outside in. With the rise of digital technology, new levers and approaches have been introduced, such as user research and user-centred design. However, I think the lack of digital literacy amongst many senior leaders means that perhaps this lever isn’t pulled as consistently as it could or indeed should be in some sectors.
I think there are more and more organisations that are also choosing to focus on diversity and inclusion. I think for some, this is driven by a sense of corporate responsibility and it being the ‘right thing’ to do or what is expected from them as employers. However, I think the people who really get it are those who recognise that organisations that aren’t diverse and inclusive are less likely to be successful in a volatile and ever-changing world.
The problem is that diversity and inclusion are tough to make work in practice. As a US citizen in the UK, a woman in the energy industry, and more recently, a private sector person in the civil service, I can say this with some experience. It can be tough to feel like the odd one out and feel counter-cultural and that your perspective is sometimes not heard or considered. As a leader, I am not sure I have always been fully committed to leveraging diversity and inclusion; I might have been too focused on feeling like the odd one out myself.
As I look forward to starting my new role at NHSBT, I do hope that I will be able to continue creating a diverse and inclusive environment, as it is something I want to attend to. I have seen enough evidence to show that it is a critical factor in successful organisations.
Housing associations, NHS organisations, local and central government structures and others have to be run commercially but retain an authentic and focused commitment to delivering on their social purpose; what challenge does that pose for leaders in terms of culture building?
I am going to be a bit provocative and say that rather than a challenge I see it as an absolute asset. I left my previous career in the private sector as I wanted to do more than maximise profits and increase shareholder value. In that respect, I feel like I have found kindred spirits in the public and third sector: people who are motivated by a sense of social purpose or public good. That kind of connection to the central mission of the organisation is so incredibly powerful. It comes with a sense of pride and, subject to the right leadership, a willingness to go the extra mile. I think private sector organisations would die for this sense of drive and connection to the core mission of the organisation. This is so central to what you find in social housing and the public sector.
Betsy was appointed to the Group Board of L&Q on 3 September 2015. She is a member of the Governance and Remuneration Committee and chairs the Customer Experience Committee. Betsy was appointed Chief Executive at NHS Blood and Transplant in March 2019 following four and a half years as the Director General, Chief Operating Officer at the Department for Environment, Food and Rural Affairs. Betsy previously spent 12 years at British Gas/Centrica where she held a variety of roles including Managing Director of Community Energy, providing energy services to social housing and fuel poor households. She was a member of Business in the Community’s Finance and Risk Committee from 2011 to 2014.