EXUS Collections & Recovery Blog

The Best Metrics Collectors Use to Boost Performance

Posted by Raul Gaitas on Thu, Feb 09, 2017 @ 09:00 AM

17222297888_8526933948_z.jpgTraditional collections operations used tactics like cold calling that made measurement difficult. Now, in modern debt collections, metrics have expanded and evolved into collector productivity, collections and recovery performance, and capacity planning. Your department should gather data on all segments and report on specific metrics to improve collections performance. 

Measuring the right metrics will allow your department to test new strategies and learn from them. That, in turn, will help you iteratively improve performance. Continue reading to discover the top 14 metrics collectors should measure. 

Collector Productivity 

Collectors must be productive in order for your collections department to succeed. Until you measure the right metrics, you won’t have insights into how well or poorly individual collectors are performing on the job. Begin measuring your collector’s productivity with the following metrics: 

  • Work Hours – Track the time collectors dedicate to specific activities using a tool such as FunctionFox and Harvest. These tools function as timers and generate reports that you can assign to projects. Metrics provide insight into how long an employee spends on a certain task. They answer questions like: Are employees taking too long? Are they focused or being efficient as possible?
  • Amount Recovered vs. Working Hours – Track and report how much money collectors recover during working hours. With this metric, you’ll be able to gain insight into collector productivity and how well operational processes work.  

Collections and Recovery Performance

These are the metrics that help measure the dollars and cents of recovery performance. They are typically divided into static metrics and behavioral metrics. Both are outlined below:

Static Metrics

  • Type of Debt Obligation – Segment your data into the different kinds of debts customers owe. These may include student loans, car payment, mortgage, credit card, etc.
  • Customer Exposure – Track the probability of how likely someone is to pay off their debt.
  • Account Balance – Determine how much debt your customer accumulated over time.

Behavioral Metrics

  • Kept Promise Ratio – View the rate at which debtors make payments when they say they will.
  • Non-Starter – Track the number of accounts or customers that have gone bankrupt. These debtors are not worth pursuing or dedicating time to if they have zero assets to claim.
  • Recidivist – This metric represents the number of people who repeatedly miss payments or fail to meet their debt obligations.
  • Self-Cure Rate – Find the percentage of customers who resolve debt obligations on their own, without collector involvement. 

Capacity Planning

Productivity metrics track the performance of individuals. Capacity planning takes it one step further and tracks personnel hour allocation. With this metric, time can be efficiently allocated across accounts. This is a core cost for departments: doing it right results in significant savings. Find the best metrics for capacity planning below:

  • Forecasted Performance — Document what you expect collectors to achieve in a certain timeframe.
  • Real Performance — Track what actually happens within that timeframe.
  • Number of Accounts — Determine the number of accounts for which your department is responsible.
  • Account-to-Collector Ratio — Identify how many accounts each collector manages at one time.

If your collections department is involved in measurement and reporting, be sure you have a pulse on the right metrics. Each of the metrics listed and explained above will paint a picture explaining performance, efficiency and more. The results will encourage new strategies, additional training for certain employees, or other operational or structural changes, if necessary.

Looking for even more ways to improve performance? Our Collections and Recovery Best Practices Manual will help you continue to improve your debt collections processes and yield the best results.

Tags: Collection and Recovery Operations