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Data analytics help with collections

Johannesburg - Data analytics can enhance collections and companies should start taking advantage of it, says Blake Group’s global head of sales Tracey Swart.

Any industry that deals with large volumes of customers’ needs to have some sort of data intelligence in place extracting and analysing data, and the collections space is no different, according to Swart.

"The biggest benefits we are seeing from the increasing usage of data in the collections industry is the ability to better understand client behaviour. Analyse enough of the right kinds of data and your company can start to identify patterns that it can use to streamline business processes," said Blake.
 
Some applications include the ability to notice which customer profiles are more likely to pay outstanding debts and devoting more resources to targeting those that fit this profile. Or one could identify what kinds of methodologies and channels certain customers respond to the most and adopt those when dealing with them.

READ: SA's finance sector banking more on big data

Even individual pieces of data like salary information are useful in identifying a window period in which a delinquent customer is more likely to pay.

"Having a comprehensive data strategy in place can help give better insights upon which to base business decisions. Instead of treating all customers the same, it becomes easy to tailor individual approaches," said Swart.

There are several aspects to consider when implementing data collection and analysis strategies. One is around the reliability of the information gathered. Analytics rely heavily on accuracy, and it can be a challenge to fill as many data fields as possible with the most up-to-date customer data.
 
Secondly, identifying the right trends and patterns requires significant resources around business intelligence. Companies that lack these will need to scale up their operations through business process outsourcers who have expertise in these particular areas, in Swarts' view.
 
There are also questions around data security.

"Failing to account for legislation such as the Protection of Personal Information Act could quickly land a company in hot water, particularly when outsourcing operations to a third party," warned Swart.

"These challenges should not however dissuade companies from doing the initial legwork and finding a strategy that works for them. Data analytics are already playing a big role in the collections industry and this will continue to grow as the tools progress."

ALSO READ: Big data to change your life - quietly

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