Customer relationship management (CRM) practices have traditionally included sales activities, marketing, customer care and even technical support. However, these same organizations handle collections the way they did 20 years ago – with separate customer care and accounts receivable functions. This “reactive” strategy stalls collection activity - and payment - until the customer is well past due.
However, Sitel has pioneered a new “preventive” collections approach that combines advanced technology and sophisticated billing analytics to identify revenue recovery opportunities early in the payment cycle. This strategy, with proven success at our sites in 27 countries, secures payment before the customer ever reaches the collections stage.
In many cases, customers that have receivables issues are still contacting the company’s customer care representatives to conduct business. By routing these contacts to a new type of collection associate called “universal agents” who handle customer service calls and then move the conversation to billing or collection issues. In a single call or multi-channel engagement, costs are reduced, payments are rendered, and customer relationship is preserved and revenues increased.
Here are the seven key steps to establish and manage a preventive collections strategy alongside your current customer relationship management practices:
1. Choose the right people
Screen agents for collections, with a customer care skill sets up-front. Identify individuals capable of serving as “universal” agents, able to handle virtually any issue – from standard customer care issues to past-due collections. Then, match top performers in each area to specific clients.
Universal agents can easily be identified by their customer service skills and a thick skin required for past-due collections. Simply put, you can teach a collections agent how to handle customer care, but customer care agents rarely have the skills needed to manage collections calls.
2. Provide up-front and ongoing training
Once identified, universal agents should receive special training. They must have the empathy, bridging and negotiation skills needed to open and close a customer care issue and negotiate and resolve a past-due billing issue – often during the same call.
A certain amount of ongoing training is required. Agents must be kept abreast of the latest client offers. They must know how to change a customer’s payment due date, offer credits, or waive a service fee.
If the customer recently lost their job, the universal agent must be able to show empathy and offer payment alternatives.
3. Control customer service quality and performance
With customer data and payment habits on their screen the moment the call comes in, universal agents can deliver a quality customer experience by offering empathy and sympathy – while remaining firm enough to meet the client’s collection targets.
Statistics prove that empathy and the ability to offer alternative arrangements – as opposed to the traditional, bottom-line collections call enhances customer satisfaction/loyalty and increases the likelihood of receiving payment.
4. Leverage customer data to build prevention strategies
When a customer gets his or her paycheck, every company wants to be paid first. By having the individual’s payment history on-screen at the outset, the universal agent is better able to negotiate. They may offer suggestions like: “Can we change the due date to better fit your needs?”
After incorporating a more conversational, sympathetic approach, Sitel’s clients experienced a twelve percent lift in payments. Though a friendly, caring approach increased the handle time, it also delivered superior financial results.
5. Provide access to all customer contact channels
More and more consumers and business people are using non-traditional means for communications. Communicate in the medium of their choice. Employing a multi-channel approach, the preventive collections program can leverage or combine voice communications with other direct contact channels, including direct mail, chat and email.
6. Deliver global consistency
Implement and enforce a set of operating standards for all customer care and collection interactions throughout your operation. This will ensure equally trained agents with reliable service to your clients around the world.
Sitel’s success with this program is based on its Global Operating System (GOS), a set of highly defined, world-class standards derived from global call center experience over the past 20-plus years. The GOS process delivers universal agents with consistent skill levels, regardless of where they’re located.
7. Provide motivation and incentives
Every client has different needs. When it comes to motivating and incentivizing universal agents, there are a variety of client-specific compensation models. Earnings and incentives can be based on cure, liquidation and collection rate measurements. Sitel works in partnership with our clients to create a program that provides agents with the motivation they need to help each client reach their goals.
With this strategy, agents are able to engage late-paying customers and gradually move them away from the collections process, in some cases permanently. Identifying and resolving past-due issues before the customer reaches the collections stage is a proven way to enhance the bottom line.
Steve Copeland is the Director, Product Management of Collections, Sitel.