Many retailers operate hotlines to provide employees, suppliers, and customers with a way to confidentially and anonymously report misconduct or policy violations. Coldwater Creek is one such retailer. But when Divisional VP of Internal Audit Fred Halpin found effectiveness and efficiency problems with the retailer’s homegrown management-operated voicemail-based hotline, he knew it was time to overhaul the problematic system.
Coldwater Creek operates 355 stores across the United States, specializing in women’s apparel. Therefore, the retailer provides a dedicated hotline service that allows callers to report concerns in a discrete way to its internal audit function to identify trends and resolve concerns. Anyone can call the 1-800 hotline number, which is posted on Coldwater Creek’s website.
Avoid In-House, Voicemail-Based Hotlines
When someone called the hotline, they were not connected with a person, but rather a voicemail message. The voicemail message instructed the caller to describe the concern, and to provide contact information if they’d like to be contacted, or to omit contact information if they wished to remain anonymous. “Our hotline system had efficiency and effectiveness problems,” explains Halpin. “Because our hotline system was voicemail and spreadsheet-based, listening to the voicemails and plucking important data points in what were sometimes rambling voicemails was time consuming and inefficient.” Members of the internal audit function manually entered data from each voicemail into a spreadsheet for follow-up and record-keeping purposes. “Anonymous callers would not always include pertinent points we needed to address their concern,” says Halpin. “That affected our ability to act on those concerns. Sometimes we were forced to drop the case altogether due to lack of information and hope the caller called back.” Also, the fact that it was an in-house, internally-managed process and system created the potential for a negative perception in people’s comfort level. For instance, some callers might have questioned whether their company-related concerns would be objectively addressed given the company managed the process itself.
In addition to the aforementioned issues, each voicemail presented the internal audit function with two important yet daunting tasks. As the gatekeeper of the hotline’s voicemails, the committee prioritized each voicemail based on its severity. Level A calls were allegations of serious infractions (e.g. laws were broken or code of ethics was violated). Level B calls were complaints (e.g. unfair treatment by a supervisor). Level C calls were innocuous inquiries (e.g. how is vacation calculated on my paycheck?). The internal audit function had to diagnose the call, and once they did, they had to determine who within the organization was best to address it. “Diagnosing and assigning calls is very important to success of the program,” says Halpin. “But it takes a long time when you couple it with screening voicemails.”
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