Getting to know your collections data

Understanding the capabilities of data analytics and what this means for the rest of your business.

We often tell new and prospective clients that each part of the collection process that is automated and digitalised wins the team more time to focus on higher-order tasks such as interacting with clients and improving their collections strategies. 

Beyond that, digitalising your collections department helps your company gather data at an astonishing rate – and applying the right data analytics just to the information produced by this one small department in your company, can have far-reaching implications for your entire business. 

To better understand what you can do with the data that your brand new automated, digitalised collections team produces, it is important to know that there are three levels of understanding where data analytics is concerned. 

At the most basic level, correctly analysing your collections data can give you a fair amount of hindsight. You can use the knowledge that you gained from the data to create historical records of your collections and get a fairly good picture of what happened to your customer accounts over the previous months or years. 

Unfortunately, we find that an overwhelming number of businesses believe that they can only gain hindsight from collected data. This not only affects their decisions to collect in-depth information on each account, but also the overall digitalisation of the business. After all, if data only has historical value, no business owner will make the additional investment in advanced automation or analytical software for their company beyond the most basic solutions. Thus, this is where the digitalisation journey ends for most companies.

This is, however, to their detriment because being able to gain insight from your collections data is substantially more valuable than just being able to provide a retelling of your company’s history as seen through the eyes of your collection team. Having insight means being able to determine why your collections team performed the way that it did. 

This requires that your team collects a much wider set of information and slightly more advanced analytical capabilities. Your team may, for instance, benefit from collecting regular customer credit information, as well as include customer interactions, feedback, and payment arrangements in the data that is captured. Individual customer payment patterns are also valuable here since you can often see changes in the way that a customer has behaved in terms of repayment, long before they eventually fall in arrears. 

Your data analytics software also has to be more sophisticated, because it now needs to be able to take many more variables into account. The value of gaining this level of understanding from your data is immense. It allows your collection team to draw up individual customer profiles, interact with them on a much more personal level, and help them to devise strategies and solutions that will yield the best results in the least number of steps for each customer. Again, this can make your team much more efficient. 

The final level is by far the most important for any business, but it requires an intelligent software solution and a business owner who is prepared to commit fully to the digitalisation of the company. Foresight is the ability to predict red flags, customer behavior, and the efficacy of your collection strategy well in advance. 

The good news is that the artificial intelligence required to predict the future for your collection department with spooky accuracy already exists and is accessible to any business. However, your team needs to be prepared to radically change the way that they operate and interact with the technology that they have at their disposal. 

Using the data that the team captures, cutting-edge data analytics is not only able to predict the payment behavior of long-standing clients but also immediately identify red flags with new customers, provide highly accurate projections and devise daily work routines that help teams operate at peak efficiency. 

With this in mind, you should be asking yourself whether you are stuck at the hindsight portion of your company’s digital journey.  

For information on how to automate and streamline your account management systems, contact us on 021 – 001 4758 or visit the Jumping Fox Software Website