One of the best things about working in credit and collections is the results of your work are immediately measurable. If a customer or debtor remits a cheque for $10,000 because of your efforts, you know you have done your job well, and you can place a dollar value to your work. However, on the other side, most collection agencies, and some receivables departments assign their staff targets and goals to reach.
On the face of it, it’s a good idea – with quantitative results you can measure your staff’s effectiveness, and keep score of recoveries or bad debt write-offs. However, this can cause a stressful environment for staff members and managers if not handled properly.
This is not an article on the structure of targets, but a survival article for collection agents who struggle with the negative side of them.
Things to remember …
-> Don’t let your target affect your morale – if you are discouraged or down on yourself for being behind target, don’t let that affect your confidence or tone on the phone. Often collectors get into a self-destructive cycle when they are not performing well, and lose all confidence in their own abilities. Some days, it’s important to not look at your performance reports.
-> Don’t get complacent! Just because you are beating your target each month doesn’t mean your role doesn’t deserve your 100% attention and focus, and you shouldn’t constantly strive to learn new skills and be better at converting contacts to payments.
-> Keep your eye out for outside factors that might affect your revenue – if you normally receive weekly file assignments, and files haven’t arrived this week, it will affect your performance. Make sure everything that influences your revenue is running smoothly.
-> Many companies believe that gamification drives performance – the ability to compete against yourself. This is definitely true in collections. Whether you are pushing yourself for a minimum number of calls, or cured files, or gross dollars collected, this is an excellent way to maintain focus. However, don’t use it to create a negative environment with harsh competition between staff members, or feed your ego. There is good competition and bad competition in the workplace – remember that.
-> It’s all about process. If you don’t make the calls, and say the right things, the revenue simply won’t happen. Some managers realize this, and others simply demand results. If you are struggling with your targets, analyze your own process. Are you making enough calls, talking to enough right party contacts, and converting enough of those contacts into recoveries?
-> Watch for symptoms that will affect your revenue down the road. If you change something key to your process, such as your tone, the number of calls, or become lax with converting contacts to payments, it won’t affect your revenue immediately, but will start to affect you a week or two down the road. Be vigilant that you are putting in all the effort needed to collect.
-> Work with your managers effectively – if you are struggling with your targets, talk to your manager about what can be done to improve your performance. So many collection agents and receivables staff fail because they stop trying, and don’t reach out for support. It’s not a conflict between a manager and a staff member when they aren’t meeting goals – everyone is failing at that point, and they need to work together to get everything back on track.
I’ve never liked the ‘sweat-shop’ mentality that many managers take to collections, but goals are often an important measurement of success. Realize they are a tool to stay focused and on top of your role in your company, and work with your targets.
For our part, I try to set achievable goals that can be surpassed, and provide our staff a daily report that breaks down their monthly target, showing post-dated payments, current payments, recoveries for that day, and a percentage measurement against the staff member’s salary, the goal for the client, and the goal for the branch. It’s a complex report, but it helps our staff maintain focus on a number of projects, and show improvements if they are struggling.
If you have any questions about targets and goals, I’m always interested in hearing what different collectors do to motivate themselves and stay focused. Feel free to call me directly at 226-946-1730 or email me at email@example.com.
Kingston Data and Credit