In Focus Risk


Left-right: Andrew Dancy; Atul Vadher; Atul Vadher; Andy Bass; Harry Dodd Noble


How can you improve customer service at the same time as improving collection rates and if so how? GA: In previous times, pre-Pega CCMT, we had a one-strategy concept, you had to make the call, make the call again, send a dunning letter, send the second dunning letter, issue pre-litigation notification and so on. What our new system has allowed us to do is to actually formulate up to about 25 different strategies, helping us to manage the collections by industry and customer payment performance and their desire to actually receive calls or not. Some of our customers do not want


to receive calls, but they do want that touch-point. Some of our customers request e-mails as opposed to calls, stating ‘just an e-mail is fine because it gives us a reminder’, so that is exactly what we have done. Knowing your customers is key.


AV: On the customer-service point, I have worked at two extremes. In the fashion industry, it was not just all about collecting money it was also about the relationship because you are in competition with other suppliers and there was always an element that the customer would pay you because it was you, not because of your approach, but because it was you. That kind of relationship was very important. Whereas in another industry, you could


make 50 calls and they would not pay you, all you would have is 50 calls and a telephone bill. But the key to ensuring collections is to use all your resources – and do not forget that sales is a resource because they see the client – and, most importantly, knowing your customer. You will have those who ask you why you are calling them, and others who are glad you have called.


38 It is a question of treating people as


humans and treating them on the right level: if you are dealing with a corporate, you are dealing with a finance team, but they are still human, they pay you because it is you, not just because they have to. It is a question of working out what works,


and for that you need to be very hands-on and have a very hands-on team who know how to get the best out of that client.


GA:When we were developing our system (Pega CCMT), the biggest challenge was that of change management and how the staff were going to adapt from the ‘As Is’ process to the new ‘To Be’ semi automated processes. Being open, honest and transparent is


key to ensuring your staff are on-board with the changes, furthermore allowing them to be part of the change in their department. The new system has allowed our staff to personally develop even further too, giving them new skills and thus developing their personal careers. Helping your staff to understand what the


changes are and why they are being made, and then training them in this evolving AI world has made all the difference. It was not plain sailing: a couple had


real concerns, but these concerns were easily mitigated.


HDN: There is always a question, in terms of automation, about what people actually mean by that word. There can be letters sent out automatically, but it is interesting what is meant beyond that.


MP:What is being talked about in collections, I saw in new business around 20 years ago when credit scoring came out. Because you were used to the old style of underwriting: you did it yourself and you knew which people would make good decisions and who would not. So it was a case of trying to persuade people that a good scorecard would be far more efficient than any person was. Eventually you almost had to send people statistics on how good they were on underwriting compared to how the scorecard performed, and then you could turn round and say ‘that is why we use the scorecard’. And then, when it moved on, you could show them the efficiency savings. When consumer credit was just starting to


be regulated, people could to me to say ‘why can the FCA not come out and say that we need to look at bank statements’, but no, if we were going to take bank statements, that would mean that I would need another 10 underwriters and the ensuing costs. So it was a case of convincing both the


If a black box has made a decision about you, if an AI has scored your credit profile, then you now have a legal right to ask and be told how that decision was taken


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firm and the regulators that a technological approach would work well. At the same time you had to remember, as a regulated firm, that anything that is automated can have a weakness if nobody understands and can explain how the decision was made. So if you are doing it, you have to be prepared to write off a given amount because the scorecard has not worked correctly.


AD: It is actually one of the rights under GDPR I do not think people have fully come to terms with: the right to an explanation.


March 2020


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