Telstra cops fine for poor service

Telecommunications giant Telstra has felt the wrath of the Australian Communication and Media Authority (ACMA) for failing to meet service standards.

Failure to meet customer service targets for timely new urban landline connections has cost Telstra $510,000. The fine was issued as Telstra fell short of two of the benchmarks outlined in its own Customer Service Guarantee, which was a requirement of the company’s privatisation.

Although meeting seven of the nine targets set, Telstra only achieved 88.8 per cent of new connections for urban, falling short of the 90 per cent required by 3938 connections. And although it also missed the mark on connections for remote areas, achieving 89 per cent of the required 90 per cent, the company was not fined for this breach, receiving only a warning.

In determining the fine, ACMA said it had taken into consideration the company’s cooperation and extreme weather conditions which had impacted the network. In a statement, Telstra responded to the fine by saying, “Last year, we faced unprecedented damage to our network from natural disasters. We fixed more than one million faults for our customers and a number of events, such as the Queensland floods, Tasmanian fires and Warrnambool Exchange fire, placed great strain on our network and resources across the country.”

Telstra has also been put on notice in regards to its removal of payphones and failure to strictly comply with the stakeholder consultation process.

The fine imposed is determined by regulations and relates to the margin by which the service obligations were missed. ACMA Chairman Chris Chapman said, however, that Telstra had been increasing its cooperation with the regulator, “I welcome Telstra’s improvements already implemented and its commitments to the ACMA to further improve its internal governance in these areas of operations, as well as its operational processes and systems,” he said.


Opinion: Is a fine enough?

For years consumers have grumbled about Telstra’s poor customer service, connection issues, fault resolution and billing irregularities, but the company actually appears to be meeting the required standards on dealing with such matters. The recent fine imposed on the telecommunications giant is actually for the specific issue of failing to meet the required number of new urban connections, not for sending people into a tailspin when trying to get someone to assist with their complaint.

When we moved into our new home two years ago, it took Telstra just under three months to connect us. Granted, Christmas did fall within the time period and there were questions about what procedure the builder should have followed, but the lack of action, or indeed interest, displayed by the majority of Telstra staff we spoke to was staggering. Who knows how many mobile phone calls, each answered by a different person which necessitates the re-telling of the whole sorry tale, it took to finally get someone willing to take responsibility for resolving the issue. And don’t get me started about the billing irregularities once we were finally connected!

Of course, now that everything is OK, we seldom think of Telstra and its poor service and seemingly chaotic processes, but that doesn’t mean the company has improved, it just means it’s no longer our concern. And I don’t think we’re alone.

For those people who haven’t had their issues resolved and are still without a connection, the fine of $510,000 will not relieve their anxiety or anger. All too often a large fine is seen as the answer, but when a company is raking in $3.9 billion in net profits, is a $1/2 million fine really an incentive to improve?

And it doesn’t end with Telstra. Ask just about anyone and they will have a tale of woe when dealing with a large company, be it a bank, superannuation provider or insurer. All too often companies are simply forgetting about the customer in customer service.

Do you think Telstra performs adequately when dealing with customers? Do we expect too much of a personalised service when dealing with large companies? Is fining poorly performing companies the answer?

Written by Debbie McTaggart