Collecting from the hopeless
This article first appeared in MG Business in August 2008
Last year I found myself in the unusual position of trying to fix the problems of an Indian call centre. A client had had a large credit management call centre in Sydney. Someone had decided that they would save a lot of money by closing it down and moving the operation to India. The new call centre in India (looking primarily at collecting recent missed payments, not hard, old debt) had been running for about six months, and it wasn’t working well.
It was initially described to me as a listening problem and, while there were other issues too, this diagnosis was essentially right. Listening and understanding and questioning and having options in relation to some of the things customers said: these were the things that we needed to work on.
Here’s an example of the problem I’d been sent to fix: I sat and listened to a call in which a consumer who was only just overdue explained that the only money he had, was just enough to pay his rent. There was a long pause. “I just don’t know what to do,” he said. The rest of the conversation and the tone of voice made it clear to me that this was a customer who, financially, was between a rock and a hard place. He was without hope – he just couldn’t see a way out of his problems.
I should point out that there are some superb credit managers and debt collectors of Indian origin working in New Zealand. However, this particular collector, being unfamiliar with western speech patterns, probably hadn’t recognised the helplessness in the voice of the customer, or hadn’t understood the implications. Equally importantly, he certainly didn’t know what to say in this type of situation. He just went back to the procedure that had been drummed into him in his training programme. He ignored what the customer said and asked, “so when will you pay this?”
Clearly the idea of pushing for a payment date was something that had been hammered into all the call centre’s collectors. I would often hear a customer “lose” an Indian collector in the course of what they were saying. Because of the Aussie accent, or the use of terms the collector didn’t know, or the speed of a customer’s speech, or the quality of the line, or something… the collector would fail to understand. However, often the collector wouldn’t want to lose face or waste time by asking them to repeat the story. Instead, he or she would hope that whatever had been said was unimportant and would go straight to some variation of, “so when will you be paying this, sir?” “I’ve just bloody explained that!” I heard one frustrated customer say.
Misunderstandings led to a very high percentage of angry customers – nearly 15% of calls. One or two customers out of every 10 would end up shouting at the collector. The business was desperate enough to fly me all the way from Christchurch, New Zealand to Bangalore, India to try to fix the problem.
The part that I want to talk about in this article is: what do you do with people who can’t see a way out, stuck between a rock and a hard place with expenses and creditors coming at them from every direction? I think this is a really important issue, not just for Indian collectors in a call centre, but for New Zealand credit staff as we head into dark economic times.
Let’s think about what happens in a reminder call. Most customers of most businesses promise to pay when a creditor calls to remind them that they haven’t. Of course, some of them will make you a promise knowing that they can’t or won’t keep that promise. Most businesses find that customers are more likely to make a promise which they then break, than they are to admit that they can’t pay.
When someone indicates up front that they can’t pay, there is usually limited value in simply continuing to push them until they make some sort of promise. Ultimately they may promise you a payment in order to get you off their back, but it’s almost certain that they won’t keep it. All it will do is delay action while the creditor waits for them to miss their promise.
So it is not a useful tactic to simply keep pushing for a payment date. You either make the customer swear at you or you get an empty promise.
In this sort of situation, I find it useful to try to get credit staff to remember that collecting money is a form of customer service. You are calling someone with a problem; if they didn’t have a problem of some sort they would have paid. You find out what the problem is, then get them to pay.
If they say they can’t pay, it becomes even more important that you work out what’s going on. Assuming this is a customer who you haven’t spoken to before, or who hasn’t had this problem before, you won’t know what the problem is. Before you try to collect the debt, you have to try to understand. You work out what’s going on by asking.
Here’s something more useful to say to this sort of customer. “What can you tell me about your situation?” This is an open question that lets the customer talk about whatever they want to talk about – their debts, their job, their health, their creditors, their marriage break-up, etc.
There is a limit to the amount of time you can spend listening to the problems of a single customer, but the concern that some collectors have – that talking to customers will take up too much of their (the collector’s) time – usually misses the point. You’re trying to collect the money; if you invest some time in finding out what’s going on, you may find a solution; any approach which doesn’t start with finding out what’s going on is likely to be a waste of time and the delay will make the situation worse; the right thing to do is to treat the customer with respect and try to get him or her to tell you what is happening. It can’t hurt, and sometimes you will find it achieves surprising results.
This article first appeared in MG Business in August 2008
Peter Hattaway – www.hattaways.com – is a director of Hattaways, specialists in credit management training and consulting. This article is not legal advice.