What KPIs Should You Use For Debt Collection?

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Nov 14, 2021

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Deciding what to measure (and how to measure it) at your agency is crucial to make sense of the high volume activity that takes place every day.

Tracking data efficiently will be key to evaluate your operation and make changes where needed.

To find out more about how to tackle KPIs (or Key Performance Metrics) we turned to the experts.

Jimmy Chebat, founder of ZiZo Technologies, and Brian LeClerc, collection manager at Marcam Associates, sat down with our co-founder Alex Villafranca to talk about:

Which KPIs debt collection agencies should track
How to track these KPIs
Which KPIs to share with collectors, and how frequently
How to use KPIs to engage your collectors

Watch or read their conversation below to go from “smile and dial” to a well measured and efficient operation.

What KPIs Should You Track?

In the past, the majority of collection activities would boil down to two things: Calls made and money collected.

However, as Jimmy explains, there are so many variables that lead to collectors meeting their monthly quota.

To further complicate things, as Brian notes, only measuring the number of calls made is no longer realistic when there are so many different channels of communication available – and consumers are no longer as likely to answer their phones.

Brian and his team at Marcam have started tracking a few different metrics to adapt to changes in the industry.

Inbound conversations vs. outbound attempts
Responsible party contacts
Employee satisfaction

To break these down further, Brian explained that an agent who makes 500 calls and leaves 475 voicemails wouldn’t have as great of an impact as an agent who made 60 calls and had 60 conversations with actionable outcomes.

As for employee satisfaction – there would be zero activity to measure at your agency without agents. In a time when hiring is arguably more difficult than ever, measuring the happiness of your employees is a good habit to adopt.

Brian recommends anonymous surveys to collect this data and adjust where needed.

Reverse Engineer Your Most Important Metrics

In addition to these metrics, Jimmy recommends a practice that he refers to as “reverse engineering your primary metric.”

No matter what industry you’re in, your bottom line is most likely net profit. Working backwards from that helps you understand what activity specifically goes into achieving that goal.

While your primary metric is likely each agent’s quota, as Jimmy explains, “A lot of things lead to a successful quota.”

Some specific metrics Jimmy recommends are:

Attendance
Deals closed
Deal value
Deal stage (or payment stage)
Close rate

Before we get carried away with all the different metrics to be tracked, we asked Brian and Jimmy the logistics of tracking these KPIs.

How Do You Track KPIs?

Marcam’s software creates and distributes reports automatically that they then refer to for their KPIs.

These reports are then combined into one master report that helps them track their activity.

Most software built for debt collection has the capacity to automate these types of reports for you – including ours 🙂

Talk to your vendors to find out if yours has this ability.

There are also vendors who work with agencies to track and gamify KPIs (like ZiZo 🙂 ) and will integrate with your inbound and outbound software to automate this process.

Jimmy recommends getting this information as close to real time as possible so that management can be proactive in noticing trends and responding.

How Should You Include and/or Notify Your Collectors in KPI Tracking?

At Marcam, transparency plays a huge role in their culture. They share their KPIs on a regular basis and share high level metrics like dollars collected during their morning huddles.

Their philosophy is that, even while his team is working from home, keeping this data transparent will unify his team and motivate them to achieve their goals.

Jimmy goes on to explain that a culture of transparency leads to a culture of accountability.

One of the most powerful ways to engage your employees is to let them know “where they stand” on a regular basis, even in relation to their peers.

If their expectations are clear and so are their outcomes, it’s easy for those employees to know exactly where they stand. The more objective your expectations are, the better.

In doing so, when performance reviews roll around, your collectors are not shocked or surprised to hear they are not meeting expectations. Instead, they have an ongoing understanding of their performance and can make adjustments proactively.

How Do You Use KPIs to Draw Out Competitiveness and Engagement?

Jimmy explains that not every KPI needs to be turned into a contest.

Sometimes, the knowledge alone that your performance will be shared with others will motivate your collectors to be at their best.

When it does involve a competition though, Jimmy has found that collectors will do everything in their power not to be at the bottom of the leaderboard.

They shared a few examples of gamification techniques for collection, but keep in mind none of these would be possible without real-time access to data.

Offering "Experience Points"

This technique is especially useful if you have a lot of new collectors.

Create a set of daily challenges that your collectors must complete, using metrics like:

Calls made
Accounts notated
Responsible party contacts processed

If all of these challenges are complete, the collector then receives experience points.

Measure "Career Statistics"

Using ZiZo’s gamification platform, agencies can track the “career statistics” of your collectors.

For example:

Lifetime closed deals
Total Number of calls made
Total number of customer compliments received

Using this data, managers can mark significant milestones that your collectors reach and reward them appropriately.

"Survivor" Campaign

Marcam Associates ran a one month campaign where collectors competed against each other using metrics like calls made, payments, “paid in fulls.”

The entire company participated, including IT.

Brian explained how campaigns that include everyone has a huge impact on team spirit.

If you are doing campaigns where collectors compete against each other, he recommends pairing newer collectors with more experienced ones.

This builds a sense of comradery and keeps the playing field level.

According to Brian, there is a direct correlation between team bonding activities and revenue performance.

How Often Should You Reevaluate Your Operation Based on KPIs?

The beauty of KPIs, as Jimmy explains it, is that micromanaging becomes completely irrelevant to your operation.

Instead of managers having to remind collectors what their goals are and ask them how far along they are in their progress, collectors can almost manage themselves.

They have access to all the data and can see exactly how far along they’ve progressed.

Your weekly 1:1s or performance reviews then become conversations about strategy instead of simply reviewing KPIs.

Meet with your team in the same cadence that your track your goals – for example, if you track weekly goals, meet weekly – to discuss roadblocks, individual goals, etc. and adjust strategy where needed.

Brian recommends giving your campaigns enough time to play out before you evaluate their effectiveness. For Marcam, this is 3 weeks, but every agency is different.

The key to this, explains Brian, is to evaluate campaigns against past campaign performance so you have exact benchmarks for success.

None of This is Possible Without Access to Data

As Jimmy explains, none of these strategies or ideologies are possible without access to real-time data.

ZiZo can help you consolidate and gamify your KPIs – click here to learn more!

In addition, all of our products have rich reporting capabilities – click here to learn more or use the link below to book a meeting with one of our product experts!

About The Author

Alex Villafranca

Alex is the CEO, co-founder and Head of Revenue at Arbeit, a better outbound communication software that makes businesses more profitable.