Remember when things were easy?
Me neither, but it sure seems like they’re getting more complicated. Sometimes, things seem so complicated you just want to ignore them.
That brings me to today’s topic — optimization. I know that’s a ten-dollar word that analytics companies like to throw at you as the answer to all your problems. A lot of agents ignore it because it just seems too complex. But they’re missing the boat.
Let’s take debt placement. As my colleague Carol pointed out in her last post, first-party accountability for third-party debt collection agencies is growing. Today there’s more at stake than just how much money you can collect or recover — business reputations are on the line.
This makes picking the right agency for your debt more important than ever. And that’s where optimization comes in.
A lot of firms don’t even look at optimization because of the expense. But our experience shows it pays for itself. Easily.
Optimization in this case means fancy analytics that can figure out which is the best agency for every overdue account, based on the nature of the account and the agency’s strengths. Some agencies work better with credit card debt, or medical debt — and you can take that right down to the agent level. If you have an agent who shines on credit card debut but sucks on medical debt, why would you want him working the latter?
If you’re feeding the right debts to the right people at the right agencies, it’s good for all the parties. Why wouldn’t a DCA want the debt they’re best at working?
This is Collections 101: Optimization is smart account matching!
We had a great presentation on this at our last FICO World. I just don’t think most agents get it yet. I have to admit it took me awhile to get it, but now it seems like a no-brainer.
To read more about smart agency placement, read our paper Rethinking Debt Placement: Four Principles to Drive Compliance and Performance.