Outbound Call Center Featured Article

Making the Collect Call

By Christopher M. Carrington, CEO, Alpine Access

In previous articles, I have discussed multiple reasons why the home-based customer care model is ideal for handling customer service, sales and support. Using a geographically dispersed virtual workforce, companies reap the economic benefits and process efficiencies that can only be achieved through a team of experienced customer care professionals. Yet, have you considered that this same team could be leveraged to handle other types of customer interactions? If not, you’re missing an opportunity to improve your company’s profit margins while creating a customer-centric brand.

 

Home-based customer care professionals (CCPs) are hand-picked for their professionalism, empathy and experience working with consumers. These same attributes are what make each person well-suited to deliver results in departments that require strong interpersonal communications. One such area currently experiencing high growth due to the contracting economy is debt collection.

 

Companies Needing Debt Collections Parallel Customer Care Market

The accumulation and collection of debt is a major concern as the U.S. economy slows and consumers struggle to pay for their purchases. BusinessWeek, Newsweek and numerous regional papers have all recently written about this topic prompted by an industry report from the American Bankers Association (ABA). According to the ABA, consumer debt has hit record levels and delinquencies are at their highest rates in 16 years. Additionally, businesses were forced to write off $152 billion in bad debt last year with forecasts for even larger numbers in 2008. In order to recoup these costs, companies must either hire internal collections staff or outsource this function to a third party. The below chart shows a breakdown of the collections market according to the number of personnel employed by each industry.

 

Breakdown of Collection Personnel by Industry

 

Sector	Share
Finance	26.16%
Health care	24.40%
Retail Trade, Wholesale	12.89%
Legal & Accounting Service	4.96%
Government	2.63%
Telecom/Utilities	2.52%
Student Loans	1.86%
Government	0.63%
Auto	0.42%
Other	23.54%

                                                                                            (Source: ABA 2005)

 

As you can see, industries such as finance, healthcare, retail and legal are the hardest hit when debt increases. Not surprising, companies within these industries represent the largest clients of home-based customer contact centers. 

Debt Collection Requires a Human Touch

A recent Newsweek article stated that approximately half of debt collectors use automated calling systems with cryptic recorded messages to contact consumers. Yet those of us in the customer service field understand that engaging customers in an authentic conversation is much more effective for problem resolution.

 

Home-based customer care professionals are well matched to perform collection services. Each employee already has an outstanding ability to connect with consumers. These customer skills, along with the demographics inherent in work-from-home employees, provide clients with a team of professionals capable of delivering results despite the difficult circumstances surrounding debt collections.

 

5 Reasons Home-Based Customer Care Professionals are Well-Suited for Collections

 

1. Professionalism and Maturity. The flexibility of home-based positions makes them extremely desirable. For this reason, each hired employee must pass a vigorous recruiting and training process. The result is a workforce comprised of the top 1 percent of customer service professionals with years of experience that allows them to handle customer calls with maturity, respectfulness and insight.

 

2. Cultural Understanding. The ability to truly empathize with a customer can only be achieved by someone who has “been there, done that.” Home-based professionals are also U.S. consumers, faced with the same economic challenges and choices confronting callers in debt. Accordingly, these employees are able to work more effectively with consumers in establishing a payment plan because they are aware of the external pressures that affect decisions on how to allocate limited financial resources.

 

I also must mention that a few companies looking for the lowest-cost solution are trying to outsource debt collections overseas. In addition to the language barrier which causes added frustration in an already tense situation, these companies are trying to teach culture and sympathy, an extremely difficult task for an industry that requires subtle communications.

 

3. Technology Savvy. Connecting with consumers when performing debt collections is half the battle. Yet, when you finally get someone on the telephone, its critical to have instant access to the necessary data. Home-based customer care professionals are not only comfortable using technology, they already have knowledge of existing client systems and the online tools needed to access information. Home-based contact centers also offer the ability to record all calls, which can be important for documenting ongoing communication efforts.

 

4. Industry Knowledge Home-based customer contact centers receive hundreds of applications a day, resulting in a database of over 100,000 qualified customer care professionals ready to take calls. This database can be instantly sorted to identify prospects that meet a company’s specific criteria such as a previous experience with collections or familiarity with a particular industry. The extraordinary ability to hire qualified professionals with precise knowledge and required skills is not available in a physical call center.

 

5. Proven Security. Debt collection requires access to sensitive, personal information such as social security numbers, addresses and credit history. Home-based customer care professionals are trained to keep this type of information confidential and secure. They have passed background checks and credit checks themselves and abide by PCI compliance guidelines to reduce the risk of fraud. In addition, most home-based call centers have multiple monitoring procedures using both electronic systems and trained personnel. In this way, the outsourced call center provides clients with an extra layer of security that works in conjunction with their own internal processes.

 

Companies looking to collect outstanding balances have two options: invest in an internal collections department or outsource to a third party. Employing your own collection employees can be costly when you consider the expenses associated with operating a physical environment as well as the “people” costs. A 2008 benchmarking survey from the Association of Credit and Collection Professionals showed that approximately 40 percent of revenues from a collection division are spent on labor, payroll taxes and employee benefits.

 

On the other hand, companies can save money by taking advantage of the proven results provided by an outsourced customer contact center. These customer care professionals are skilled in working with customers to resolve problems and generate positive goodwill. It makes sense to apply these talents to collecting accounts receivable in addition to handling service calls and generating sales. In light of the economic challenges facing both businesses and consumers, I encourage you to think out of the box and look at how the similarities in the customer service industry can be applied to improve both revenue and customer satisfaction.

 

Christopher M. Carrington is President and CEO of Alpine Access, Inc. a Denver, Colorado-based provider of call center services using home-based customer service and sales employees. Carrington has more than 25 years of business service experience. Alpine Access clients include J. Crew, Office Depot, ExpressJet, and the IRS.