Please Ignore If Already Done

Irecently received a letter from my bank asking me to submit certain documents, apparently required by “know your customer” (KYC) regulations. I was a little surprised to receive this letter, for just a few months earlier, I had already submitted these documents in response to a different request from the bank.

The latest letter threatened “dire consequences” (e.g., “We will close your account without any further notice to you if you fail to comply with this requirement.”) To be on the safe side, I phoned the bank to ask them why they sent me this letter when I had already complied with the requirements. The conversation went like this:

Bank manager (after checking my records): “We’re sorry for the inconvenience, sir, but not to worry, you have already completed the requirements. You can ignore the letter. It was just a reminder that we sent to all customers. If you notice, there is a line at the bottom that says ‘Please ignore if documents already submitted.’”

I looked at the letter. Sure enough, there was this line in small print at the bottom.

Me (relieved that I wouldn’t be subjected to the threatened punishments, but still somewhat irritated at the clearly avoidable trouble): “Thanks, but I am still curious to know why I was sent this letter despite having already completed the requirements. Like me, it might have caused most of your customers some tense moments.”

Bank manager: “You have a point there. Actually, 90 percent of our customers have already submitted the information. The reminder was meant for the remaining 10 percent.”

Me: “In that case, couldn’t you have sent the reminder to only those 10 percent? You could have saved the cost of sending this superfluous letter to millions of customers.”

Apparently, someone in the bank decided that it was “too much trouble” to identify the 10 percent of customers who actually needed this particular reminder. It was simply easier to just send it to all customers, with a disclaimer in fine print at the bottom, saying “please ignore if already submitted.”

I did a quick back-of-the-envelope calculation: This bank has approximately 450 million customers, and 90 percent of them (more than 400 million customers) should not have received this letter because they had already completed the requirements. Assuming that it cost the bank a modest 50 cents in paper, envelope, printing, and postage for every letter, that’s more than $200 million wasted! The bank’s profit for the year would have been higher by that eye-opening amount if they had avoided this silly exercise.

This turns out to be no isolated example. Around the same time, I also received another letter, this time from a large insurance company where I have a policy. Again, it was the same story. The insurance company needed customers to complete certain requirements, about which it had informed customers several months earlier. This company has 300 million customers. Most customers (including me) have completed the requirement. Using the bank as a model, let’s assume that about 10 percent of these customers have not completed the requirement and actually need the reminder. In this case, the wasteful cost of sending the unnecessary letter to the remaining 90 percent (about 270 million customers) works out to $135 million!

In lean management parlance, this type of waste would perhaps be called a type of overproduction or excess processing. Regardless of how you wish to categorize it, what cannot be denied is that efforts of this nature represent a huge waste.

There is also another problem, no less important than the wasted money. If my own first reaction could be assumed to be typical of other customers, the bank has millions of customers whose reaction at receiving this letter ranges from irritation to panic (after all, you may pardon a customer for panicking if they get a letter from their bank threatening to close their account). Those are not exactly the emotions anyone would like to arouse in their customers.

Clearly, the companies in this story have a process that is not only inefficient but also inconsiderate. The bank found it “too much trouble” to design their process correctly, and therefore outsourced the trouble to their customers!

The solution is not merely to reduce the cost. For example, using less expensive ways of communication, such as email or other electronic means instead of letters, would only be a cheaper and quicker way of irritating customers. What is required is to send such communications (or any communication, for that matter) only to the persons who need them. Especially in today’s world, when customers are already buried under tons of (mostly useless) information, let us not overload our customers with more pointless information.

Moreover, I suspect that over time, almost everybody (including the 10 percent of customers for whom your communication is important) starts to ignore your communications if you make it a habit of sending communications that say “please ignore if....”

So, the next time you think of sending a communication to everybody with a line at the bottom that says “please ignore if …,” think again. There usually is a smarter alternative—send it only to the people who must not ignore it.

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