Congratulations! It’s your first day, or first week as a
collection agent, either internally at a company to handle accounts receivable;es,
or at a collection agency handling third party accounts. I imagine your head is spinning with all the
information being thrown at you, that it’s a work environment that you are unfamiliar
with, and you are wondering what it takes to survive, let alone thrive in such
an environment.
Well as my previous part of this series addressed, not
everyone is meant to be a collection agent.
But let’s assume you have the skill you will need to succeed here. But you have to get your feet under you. So what do you need to know?
Those Butterflies in
Your Stomach
Every new collection agent, and a
few accounts receivable staff, get a feeling of dread initially when they have
to pick up the phone. Why? Because they think they are about to engage
in a verbal confrontation. But if the
call is handled correctly, there shouldn’t be any conflict.
A good collection call is all
about negotiating from a position of authority, and establishing control over
the situation. If someone is yelling at
you, or is emotional, you can’t possibly discuss resolving their account, so it’s
to be avoided at all costs.
And on the practical side, once
you have had the inevitable call where you have been told to do anatomically
impossible things, as long as you don’t let your emotions rise up to meet the
debtor, you’ll be fine.
The most important lesson is don’t
be afraid to pick up the phone! Reaching
out to debtors or clients is the only way you will accomplish your job, so do
it with enthusiasm. Don’t wait for people
to call you, or depend on letters or emails to garner a response. There is nothing better for your job than
you, speaking in person.
Go In With Your Eyes
Wide Open
Nine out of ten debtors in your
office are not bad people. They are people
with financial difficulties, little
financial savvy, are living beyond their means, are procrastinators, or simply
are sticking their head in the sand and hoping their personal finances will get
better. This means that promises to pay
will not always be met, people will get emotional over their financial
situation, or your calls will be avoided.
Perform your duties with a sense
of patience, with a sense of empathy for the people you are calling, and speak
honestly and forthrightly with these people, without devolving into emotions or
let frustration spill into your calls.
Use Your Head
Credit and collections is not
rocket science – but it is a great deal of information, trivia, and details to
be managed, balanced, and remembered.
Every work environment tailors their credit cycle uniquely to their
company policies and structure. And credit and collections staff need to
react to changes in their environment – the only constant is change. There is going to be a lot to process in your
first few weeks, and you will spend a lot of effort remembering the
details.
Don’t stop learning.
The world of credit and
collections has cycles and patterns.
Often, it can be repetitious, or rely on habits of your department’s
staff, or that of your debtors and clients.
It is so easy to spend your first weeks and months focusing on your new
role, and then as you feel you have mastered your position, slip into a relaxed
frame of mind. This is definitely a
misstep. Remember the effort and focus
you have now, when you are new, and never lose it. There are new things to learn constantly, if
you continue make the effort.
Remember The Details
Look over all the information
available to you, and try to master all the small details. What debtors or clients say (or don’t say) to
you in each call should be carefully noted.
Promises for payments with deadlines carefully monitored and followed up
on. Be prepared to quote account terms
to clients, and have your facts ready beforehand.
In my role managing a collection
agency, I emphasize to new staff it is important to read the Collection
Agencies Act and Consumer Reporting Act of Ontario, and refresh themselves as
needed. Also, they should be familiar
with other collection-related laws that come into play such as the Absconding
Debtors Act, Bulk Sales Act, or other provinces’ statutes, so they can sound
knowledgeable when speaking to debtors about the rights and role of our company
acting as legal agents for our clients.
For their part, credit or collection
agents should keep notes that cover their clients’ portfolio instructions, and
keep accurate record of their calls, transactions, and the payments and credits
on each account. Be attentive to the
details, and watch for patterns.
As well, I recommend after each
call or transaction, a collection agent should take a second and think about
what was successful to achieve payment, or what failed to generate a sense of urgency
or garner a result – tailor your methods, your language and tone to what
succeeds.
Be Organized
In your role, you may be
responsible for anywhere from 100 to 2,000 or more files. You are responsible for thousands, perhaps
hundreds of thousands of dollars in unresolved credit. If you are not organized, and work your files
in a priority manner, some of this “inventory” will be lost. Make sure you can access your files for the
day, and reports to tell you if you are succeeding.
In your environment, can you answer
or address the following?
·
What priority calls or letters do you need to
address each day?
·
What are your daily recovery efforts?
·
How many files do you work on a daily basis?
·
What is your overall liquidation on your
portfolio?
·
Is your average DSO going up or down?
If you slip, and fall behind on
follow-up calls, or neglect certain records, you can’t create a sense of
urgency, and you are going to actually hamper your chances of recovering an
outstanding balance later.
Use Your Time Wisely
You only have so much time – on average
21 business days a month, and seven to eight hours a day. You will be able to work a finite number of
accounts a day. The best collection
agents I have seen develop a keen sense of what accounts are going to pay, and
do not use their time needlessly.
And furthermore, don’t work your
portfolio blindly. Use a bit of your
time to reflect on your work. Don’t
spend your time on calls or letters or strategies that result in a dead end. Draw a line in the sand – a certain DSO when
you send a file to third party collections, or a certain number of calls and letters,
before you determine that an account will not be collected, and make your
decision accordingly, listing the file with a collection agency, reporting the
delinquent account to the credit bureau, or initiating legal action.
Some Final Survival Tips
So, a great deal of this advice
is generic, and has to be. Every
environment in our industry is radically different. But one thing remains constant in my
experience. Every person who has stepped
into a collections environment without previous experience goes through culture
shock.
·
Be open minded – watch everything around you,
and take stock of the staff members that are successful. Be prepared to change your telephone manner,
your vocabulary, and your tone of voice.
·
Do not be bashful with your supervisors or
management – communicate with them honestly, and let them know when you have
been successful or are having difficulties.
·
Be patient – you will not be a superstar on your
first day. Collections requires
momentum, confidence, and experience.
·
Understand the personalities that are in play –
especially in the world of third-party collections, the work environment draws
outgoing personalities. Keep that in
mind. If you are one of those outgoing
personalities, be prepared to tone yourself down to fit in a team environment.
·
Also keep in mind that your supervisors or
managers may also have strong, dominant personalities. Don’t be put off or intimidated and
understand their needs from you as their employee.
·
Be proactive – think about your challenges, and
try to come up with solutions. Your
superiors will appreciate you are self-reliant and proactive.
·
Keep your eye on the ball – your role is to recover
funds for your company. Keep that in
mind.
·
Finally, enjoy your work! You will only last in this career if you gain
satisfaction from your work, and your workplace.
If anyone reading this blog would
like to share stories of their first days in credit and collections, I would be
interested in hearing them. Whether you
have worked at a small or large collection agency, or worked internally as a
credit clerk or manager. Most of us have
ended up here by happenstance -- feel free to post your experiences.
Blair Wettlaufer
Kingston Data and Credit
226-444-5695
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