Managing a Credit and Collection Business in Todayís Challenging Environment

By Julie Smith, ACA Internationalís CI Committee Chair

February 9, 2010

With todayís current economy, we are all feeling the pressure to do more with less. We have to keep customers happy, staff even happier, retain the best performers, reduce expenses, increase revenue, attend more meetings, get more work completed with less staff, etc. Shall I go on?


This is a critical time to focus on core business practices and processes. This includes: hiring the right associate the first time, retaining the best performing associates, completing new hire and ongoing training, performance reporting, motivating the team, customer satisfaction, quality assurance and staying abreast of new legislation.




Do you know how much it costs your company when you hire the wrong person? Most people would be quite surprised! During the interview, make sure you are asking the right questions. Determine if you are getting concrete answers from the applicant with good examples about their behaviors or just generalities?


Are you hiring result oriented associates? Ensure the person conducting the interviews knows the legalities of what can and cannot be asked during an interview. Also make sure the applicant presents the image you want, not only in dress, but how they speak. Most importantly, try to determine how the applicant will treat your customer and current staff. Are they a fit in your company culture?


Training, training, training


I canít say it enough. You can hire the right people, but if you donít provide them quality training, you have a lose/lose situation. Ensure you have a formal new hire training process in place. Please remember, your best performers are not always your best trainers. You need to evaluate who is providing the training. Have they had any previous experience or formal training?


Abandoning training after the initial new hire orientation is a mistake. In todayís environment, itís imperative you give your existing associates training. They are working more accounts, interacting with stressed customers who may react differently than normal or be abusive on the phone in response to their own pressures. This environment can cause burn out quickly to your best performers.


In addition, training motivates staff, teaches them new skills, sharpens old skills and generally brings the team together. Make it fun (i.e., prizes for the right answer to questions, raffle tickets, etc.) and your staff will look forward to these sessions. In my experience, collection performance always improves directly after training, making the time well spent in the classroom.




Do you have performance reports on each associate as well as the entire team? Do you monitor trends? Are inbound and outbound call statistics reviewed regularly? Are you receiving and/or making more calls or fewer calls than last month or the same time last year? Do you have goals in place along with a method to communicate them to the team? Overall, are your results getting better or worse? Do you know why?


Quality Assurance


Do you have a quality assurance program in place? If you are using a dialer, are you ensuring the dialer is calling all your accounts, that area codes are updated? How frequently do you call accounts? Are you checking messages your dialer leaves periodically? What number shows up on your caller ID and is it one a customer can call back? Do you periodically call into your companyís main phone number to see how it is answered and how quickly?




Do you monitor your associateís conversations periodically? Do you have key objectives you measure during these monitored calls? Is feedback provided to your associates regularly? Call monitoring can be a great way to see how your associates treat your customers, identify training opportunities, as well as ensure staff is following your companyís policies and procedures. Make sure your staff and customers are aware you may be monitoring calls. Check with your attorney or legal department for laws governing monitoring calls.


Incentive Programs


Do you have an incentive program for your collectors? Incentive programs can be effective if used properly. You would be surprised how far you can go when you ďdangle carrotsĒ in front of your staff. You may consider individual as well as a team programs to keep everyone working together. Typically collectors are quite competitive and will compete against one another raising the bar for themselves. Prizes for the day or week can be a great motivational tool. Prizes can be for the most payments collected of a certain dollar amount or other criteria to drive the best performance from your team.




Are you or someone in your company responsible for monitoring new legislation that could potentially impact your business? Are you supporting legislation that may help your business and letting your voice be heard for legislation that is not in the best interest of your business and your customer?




This is two fold, communication with your customers and your associates. Letís start with associates. Do you know how happy your associates are? Do you or your HR representative conduct regular associate engagement surveys? Do you have regularly scheduled meetings to keep staff informed of company current events, department updates, goals? Remember to allow time for your staff to have an opportunity to ask questions and give feedback at the end of these meetings. 


Some of the best ideas can come from your associates. Make sure you acknowledge and thank them for the feedback. If the feedback is good, do something with it. If not, make sure you communicate why you canít implement the idea. Nothing is more de-motivating for your associates than providing feedback and then never hearing any response from management. You want them to continue to share their ideas and feel safe doing so. 


Letís move to customers. Do you know how happy your customers are and what is the most frequent complaint your associates hear from them? Do you survey your customers? Customer complaints can often make you aware of areas needing improvement in your company. View these complaints as valuable feedback. Again, make sure you acknowledge you received the feedback from the customer and let them know what you are doing about the issue. Perhaps even doing some sort of recovery effort to regain their confidence in your company, if applicable.


Remember, often customer and associate feedback can provide valuable insights. View them as gifts.


ACA International, the Association of Credit and Collection Professionals, a not-for-profit trade association for professional businesses and individuals in the credit and collection industry, can provide your organization with the tools necessary to compete in todayís challenging environment.




Julie Smith is ACA Internationalís Creditorís International Division (CI) Committee Chair. CI is a division of ACA International serving first-party collectors and credit professionals for the mortgage, credit card and retail markets.