Managing Collector Performance - Part 1

In this series of tips, we will concentrate on managing the performance of collectors effectively.

It is widely accepted that the success of the collections function is dependant on the effectiveness of a telephone conversation between two people, the collector and the customer. Investments in technology and deploying best practice strategies improve collections, but investing in your people will optimise these investments and maximise collection results.

A best practice model for managing collector performance must include:

• The setting of performance standards
• The observation of performance – measuring performance against defined qualitative and quantitative standards
• Identifying the performance gaps of collectors
• Providing collectors with performance feedback
• Implementing development plans where necessary
• Aligning rewards and recognition with performance measurement

In this tip we will concentrate specifically on setting performance standards.

A performance standard is simply a definition of how a task should be performed. Both qualitative and quantitative performance measurements must be set. Omitting either will compromise collection targets or customer relationship management. To implement effective performance standards that will drive collector performance, your performance standards must emanate from the overall collections strategy and goals of the collections department.

Categories of qualitative performance standards include:

• Opening the call appropriately
• Identifying and clarifying the reason for non payment
• Negotiation skills and compliance to negotiation paths
• Educating/warning clients on the repercussion of non/short/late payments
• Ending the call appropriately (summarising agreements reached, system updates)
• Structuring and controlling the conversation with the customer
• Appropriate language (example: standards for eliminating jargon)
• The tone and pace of the collector

Example of quantitative performance standards include:

• Amount collected
• Number, value of PTP’s and PTP kept ratio
• No of debtor contacts
• Number of calls made
• Number of accounts worked

Once you have determined your performance standards check them against the following list:

1. Are the standards realistic, can they be achieved?
2. Are the standards valid, do they measure what is applicable to the task?
3. Are the standards specific, do they explain exactly what is expected?
4. Are the standards measurable, can they be measured in terms of number, time, cost?
5. Are the standards challenging, do they motivate collectors?
6. Are the standards dynamic, can they change as the organisational goals, technology, and strategies change?

Beverly Govender is a Consultant at PIC Solutions, the largest customer management solutions company based in the Southern Hemisphere. She has over 5 years of experience in human resources, specialising in learning and development and performance management. As Head of Training for Consumer Credit, a Durban-based division of Nedbank Limited, she focused on the key areas of effective risk management and collections. She was responsible for the implementation of a leading edge performance management and training solution for the collections environment. This implementation resulted in significantly improved collector quality and productivity levels contributing to record collections results. She is a SETA qualified Assessor, currently finalising a B.Com degree in Business Management and a Member of the Institute of Credit Management.