Using Business Analytics to Get More Out of My Collection Agency

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Balancing multiple collection agencies can be a struggle even for the most organized Credit Executive.  When you’re dealing with placing high volumes of accounts, the problem grows exponentially.  For example, if your business is utilities, the number of customers in collections can be huge. Keeping up with just the workflow around placements is almost a full […]

Balancing multiple collection agencies can be a struggle even for the most organized Credit Executive.  When you’re dealing with placing high volumes of accounts, the problem grows exponentially.  For example, if your business is utilities, the number of customers in collections can be huge. Keeping up with just the workflow around placements is almost a full time job.  Ultimately, what tends to suffer is agency performance. So how can we improve this process?  The answer is simple; Business Analytics.

Business Analytics is getting a lot of press lately and the concept is fairly straightforward.  Using technology to manipulate and analyze the mountains of data generated by companies on a daily basis, is essential for decision making in this market. Applying that same methodology to agency management drives performance as well as some healthy competition.

Agencies, no matter the size, should be able to provide a fair amount of statistical reporting. I wouldn’t even be using an agency that couldn’t provide me with some sort of regular status reports. I would expect them to be very granular.  The devils in the details, and let’s face it, if they’ve done their job right, they have all the details we need to get started with Business Analytics.  

Next we need a scorecard.  This really isn’t as complicated as it sounds and with the right information, an almost invaluable tool.  For the scorecard, I would turn to the guys in my Business Analytics department.  I would lay out a few pieces of criteria that I want to see, but I would also let them carve up the data and show me everything. 

Business Analytics already provided the data to support performance management.  Now we can finally rank and rate each agency based on their performance.  Which agency performs better on large balance accounts? Which on small? Which agency cherry picks the large balances and closes out everything else? Which agency is effective in a specific region of the country or world? If an agency does really well with a particular account type or turning a specific type of dispute into recovery, they would get the lion’s share of those accounts.  

So how does all this benefit the busy credit manager?  There simply isn’t enough time in the day to run reports, analyze the findings and still be able to provide the support needed to manage the collection process.  Business Analytics takes the labor and time spent dealing with data and provides you with just the output.  Quite simply, Business Analytics puts the power of information in your decision making process, with minimal effort.  In the end, agency performance increases dramatically and as soon as you start issuing challenges, or better yet, start moving away their placements, you’ll see the recovery numbers change for the positive.

 

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