ISO Standards Provide the Foundation for Building Customer Relationships

ISO Standards Provide the Foundation for Building Customer Relationships

The aftershock of the global debt crisis set the scene for a change in public sentiment towards big business. Since the credit crunch, house prices have fallen, consumer confidence has plummeted, taxes and prices have increased, and unemployment has risen.

The international organisation GlobeScan’s research shows that public trust particularly in banks and oil companies is ‘deep in negative territory’, and the top two issues banks need to address to regain trust are operating ethically and improving customer / online services.

In 2011 former Nokia CEO Stephen Elop wrote his famous Burning Platform memo, in which he lamented missed opportunities and indicated multiple strategic challenges to the mobile phone company. Distilled, the lesson of the burning platform is that it is far better to anticipate the crisis and change your behaviour long before the explosion.

In these uncertain times, operating ethically and building trust with your customers and stakeholders is vitally important for the long-term success of your organisation.

What lies at the heart of public scepticism?

In the run-up to the debt crisis, traders and investment bankers focused on selling customers financial products, particularly subprime mortgages loans. Whether the client or borrower defaulted, was of little interest to banks. These groups were interested in lining their pockets and not on building long-term relationships with clients. Bank executives and managers, too, focused on sales and bonus targets rather than thinking of long-term performance and sustainability.

When the US subprime mortgage catastrophe began unravelling, the world entered a global financial crisis. In the wake of 9 August 2007, panicking customers queued to withdraw their savings and the first bank run in years began. With default a real possibility, investors began demanding higher yields for bonds issued by Portugal, Ireland, Italy, Greece, and Spain. As a result, Spain’s housing market collapsed, Greece’s economy imploded and Ireland slid into recession.

The depth and duration of the financial crisis shook investor confidence and waves of violent protests swept through Europe.

public protest

Tighter liquidity following the debt crisis undoubtedly severely constrained South Africa’s economy, but government corruption compounded the problem, resulting in sluggish growth, company closures, unemployment and deepening poverty. Deviant conduct is so entrenched within institutions of government that it threatens their survival.

In what seems to be another instance of too little too late, treasury is hastily attempting to restore voter confidence ahead of elections by financing a commission of inquiry into state capture and stabilising state-owned enterprises (SOEs) hollowed out from years of poor governance, procurement irregularities and fraud.

“We are working on rebuilding trust in public institutions,” Finance Minister Nhlanhla Nene proclaimed before the standing committee on finance in Parliament on Tuesday 8 May.

Customer trust is hard won and easily lost

But it’s not only bank executives, politicians and their cronies who are guilty of such transgressions.

In what has become known as the ‘meat-scandal’, big name South African supermarket brands were tarnished when they were caught stocking incorrectly labelled meat products. Tested meat samples revealed ingredients not listed on product labels, including donkey, water buffalo, goat and pork meat. This not only violated food-labelling regulations, but presented religious and ethical concerns for the Jewish and Muslim communities.

Shortly before the supermarket ‘meat-scandal’, a Cape Town based importer admitted to re-labelling kangaroo meat from Australia and water buffalo meat from India as halal, causing outrage in the Muslim community.

Internet giant Facebook is embroiled in a world of trouble as the US federal government investigates the sharing of users’ private information with Cambridge Analytica and others unknown, while auditing firm KPMG South Africa recently appointed new board members in an attempt to restore trust after its involvement with the politically-connected Gupta family.

meat scandal

Iraj Abedian, CEO at Pan-African Investments and Research Services, commented in a press statement that:

“KPMG has to come clean before it can win back the trust of society. Changing a few characters around before coming clean is ignoring and not dealing with the issues.”

Barclays Africa, one of the continent’s largest banks, is the latest of several big corporate clients to announce that it will no longer be using KPMG auditing services. In a statement to the press on May 3, the bank announced:

“ongoing and more recent developments were evaluated by the board, which decided that it can no longer support the reappointment of KPMG”.

Customer trust is priceless

We all know how Twitter, Facebook and other social media networks can sink a product range, taint a brand’s image or batter an organisation’s reputation in a matter of minutes. It can take just one disreputable supplier, or one perceived hypocrisy, and marketing spend goes up in smoke.

Consumers frame their opinions around green and ethical claims made by organisations from what they read on social networks and trust the opinions of friends, family and people in the community in product-purchasing decisions above all advertising and marketing efforts.


“The power relationship between people and brands has forever changed because of social networks.” – Dion Chang, Flux Trends.

American management expert, Dr. Gary Hamel puts five issues at the centre of whether a business will thrive or fail in the years ahead: values, innovation, adaptability, passion and ideology.   

Of all these challenges, the issue of trust is the one most open to change in the short term.

ISO Standards provide a foundation on which to build trust

Rigorous corporate and sustainability standards and third-party certification are important foundations that can chip away at consumer and stakeholder scepticism and build trust.

“I believe standards instil trust. Standards are no longer about product differentiation but about creating a uniform experience that gives your customers confidence in your products and services.” – Datuk Fadilah Baharin, Director General, Department of Standards Malaysia.


How can ISO standards help?

Maintaining a social license to operate

As powerful influencers, organisations can act as agents for societal change. The ISO 26000 publication, Guidance on Social Responsibility – helps organisations understand the principles of SR, and addresses questions like, what SR means, the types of issues an organisation needs to address, and best practice.

Ethical Environmental Behaviour

More consumers are selecting products that are produced respecting environmental standards. The ISO 14000 family of standards provides practical tools for organisations of all kinds to manage their environmental responsibilities.

Food Fraud & Food Safety

Food supply chains are complex, creating more opportunities for criminals to practise food fraud and affect food safety. The ISO 22000 Food Safety Management System helps organisations produce safe food and gain the trust of customers.

Inspire a customer-centric culture

The quality of a product is about whether or not it meets customer requirements. The ISO 9001:2015 Quality Management System redefines quality by changing focus from adhering to product specifications and requirements to meeting customers’ expectations and satisfaction.

Prevent Corruption

ISO 37001, Anti-bribery management systems – is designed to help organisations implement effective measures to prevent and address bribery, and instil a culture of honesty, transparency and integrity.

Proactively Protect Customer Data

Securing third party data is a legal imperative. The ISO/IEC 27000 family of standards helps organisations keep information assets secure. ISO/IEC 27001:2013 is the best-known standard in the family providing requirements for an information security management system (ISMS).

Deliver transparency in products

Millennials are front and centre of the ethically conscious consumer trend. The ISO 20400:2017 Standard can be used to improve supply chain transparency. Embedding sustainability requirements has been shown to cause a so-called green bullwhip effect, whereby they become a signal that then transfers vertically down a supply chain from buyer to distributor to assembler to manufacturer.

In Conclusion

In addition to offering ISO standards training and consulting services, Risk ZA has key expertise in Governance, Risk and Compliance (GRC) Management Systems, which are essential controls for corporate success and relationships of trust with customers and stakeholders.

For more information or guidance on which ISO standard(s) and services would best suit the needs of your organisation, please email Risk ZA at info@riskza.com or contact us on 0861 Risk ZA / +27 (0) 31 569 5900.

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