How Your IVR is Costing You and How to Stop It

  • Written by Michael Meyer

meyer michaelDo you cringe when you have to push a button on an IVR? I know I do. So does everyone else. Do you still have an old traditional push button (push “1” for this or push “2” for that) IVR system hanging around handling or routing most of your inbound calls, or maybe taking a few payments? If so, it’s time to reevaluate it and consider upgrading or replacing it entirely with a newer, more customer friendly and capable system. You are probably thinking, “Why should I replace it? It has worked well for me all of these years and it probably will last a few more.” There are plenty of good reasons that you want to do this now. Some of those reasons are compliance related like Reg. E, the flexibility of changes and even the cost of those changes. However, the real reason is it is costing you more money than you realize. Let’s explore and discover the reasons why. You might have noticed that larger companies replaced these push button IVRs years ago. They are now on their second or maybe the third generation of the new IVRs. Why did they do that? You know why. The voice IVR sounds more natural, it does more, it is more flexible, it can be changed faster and it has a lower cost to operate.

The Critical Reason

Those are all essential reasons but not the critical one that drove the change. The real reason they made the change was to enable customers to self-serve themselves and get answers to their questions faster, more accurately and without waiting. Also, these changes mean those companies no longer need an employee in a call center or store to stop what they were doing to answer the same question for the umpteenth time that day. Because of the newer technology, you need less staff to do the same amount of work. Plus the new solution can quickly scale up as you grow. This also frees your existing staff to learn and perform functions that are more valuable. The potential cost savings in having less or redeploying existing staff is pretty significant now and into the future, no matter how small or mid-sized your company is. If making customers happy and saving money isn’t enough, then there is yet another perspective that will compel you to make the switch: climbing client expectations.

Expectation Escalation

If a new or existing client wants to experience what their customers will experience when contacting you and hears your archaic IVR, let’s face it, it’s not exactly what you want them to hear. So, what do you do? The first thing is to figure out what you want and need the new IVR to do. This is by far the hardest part because we are not used to laying out how we want a call to go or what routes the call should follow. I can tell you that mapping out each step of the call flow is by far the most valuable aspect of an existing or new IVR upgrade. Don’t skip this step! This will allow you to optimize what your IVR is doing in detail which is important because you might be paying for its usage by the minute, by each function that a customer chooses, paying a fixed or sliding percent of each payment or a combination of all of these. You can start this process by looking at what your existing IVR does (or doesn’t) and really looking at the IVR report.

As an example, can you see where people are pushing zero or hanging up? Can you see how many people are stopping at making a payment or how many try three or four times to enter information in before they zero out and take out their frustrations on your agents? Have you heard any feedback, good or bad, from your agents who take IVR calls? All of these are great places to start when deciding what the next version or generation of your IVR should do, how it needs to treat customers and how it must perform financially. Said another way, the more effective you make your IVR, the less you will pay in fees and the less your agents will have to work – which saves payroll. It really does not do you any good to spend time designing or buying a new IVR that ends up causing more than 90% of your customers to zero out and talk with an agent. That is just wasting money to say you have the latest toy and not doing the right thing for your customers or your business.

How to Measure Functionality

To help you get on the right track, here are two high-level measures to help you determine how your center and IVR are functioning. The first measure is called call deflection. Call deflection measures how many or what percentage of your overall calls were deflected away from human agents and handled by the IVR or an alternate non-human channel? As an example, out of 100 inbound calls or contacts, 50 were handled by agents, the IVR handled 30 and then the website handled 20. So you need to decide what you want these numbers to look like from an employee cost, technology cost and a client performance basis. Once you determine what the optimal ratio is for your business, you know what your overall design strategy should be. The second measure is call containment. This gives you an indication of how much work your IVR is really doing for you. This measure shows what percent of the calls that went to the IVR were handled entirely by the IVR from beginning to end without human assistance. Once you know this number, you need to take steps to improve it.

The bottom line with these numbers is that you might be wasting money on both sides of the equation (on the IVR and with agent’s time) and not even realizing it. This is why it is so essential to holistically and completely flow out the entire call process into and out of the IVR and not just look at the IVR as its own square box. When you do flow this call process out and look at the reports of what is happening in your current IVR, you will learn a lot and probably be surprised about what your customers are or more likely aren’t experiencing every day.

Melding and molding IVR technology with humans isn’t the easiest of things to get right. Most of us take many tries to make it work with lots of mistakes along the way. This is one of those things that is easy to say but hard to do right. So, take it one step at a time, play with it, make it fun and in the end your customers, employees and bank account will be glad you did!

Michael Meyer is the Chief Risk and Security Officer at MRS BPO, LLC

Digital Age Collecting in a Regulatory Minefield

  • Written by Jeff Freedman

freedman jeffFor those of us who have been in the accounts receivable management industry for a long time, we know that collecting on debt is not for the faint of heart. We all take pride in the services we deliver but unfortunately we are also forced to deal with frivolous lawsuits from attorneys more interested in their own finances than helping their clients. Sadly, government regulators and courts around the country only muddy the waters more with contradictory statutes and inconsistent rulings.

It is no wonder that in a landscape littered with pitfalls and potential land mines, most agency owners are reticent to take risks that could improve the customer experience and enhance the bottom line. The mantra is almost always the same, “We want to try something new, but the risks of being sued are simply not worth it.” While totally understandable, the reality may be much different. Perhaps the risks can be worth it if the proper time is spent understanding precisely where the risks lie and by building the proper controls (preferably systemic controls) to ensure compliance.

Let’s take a look at a few examples. At my company, we have deployed several different digital strategies within the last couple of years that have helped make us more efficient as well as more effective.

Text Messaging

Texting is one such area. What makes texting a little more complex is the fact that you are dealing with both TCPA and FDCPA issues around consent and potential third party disclosure. When developing strategies, we recognize that nothing is foolproof, however our goal is to create a layered defense that helps mitigate risk. One way we did this was by creating our own tool that launches text messages without the use of an automated telephone dialing system (ATDS). By generating the texts in a manual fashion (requiring human intervention to send each text), we add an additional layer to any potential claim of a TCPA violation. This is not to say that we ignore consent but rather we don’t simply rely on consent as our only layer of protection. We also add another layer of protection by conducting a phone ownership scrub. This scrub enables us to gauge the likelihood that the customer we are seeking is the primary user of the phone. This adds yet another layer to our defense as we try to avoid sending text messages to the wrong party.

Finally, the messages we send are FDCPA compliant, both in terms of content and the time of day in which we launch them (the text cannot launch if it is outside of acceptable calling hours in the recipient’s time zone/address). Needless to say, this texting tool has been invaluable to us as we have increased our right party contacts by connecting with more customers who might never have engaged with us by telephone call or snail mail. We deploy many of the same controls and principles when we email customers, however it is worth noting that we have seen a much greater impact with texting than with email.


Another area where we have crossed the digital divide has been with our AI-enabled conversational IVR that we call ADAM. Unlike traditional IVRs, customers no longer have to “…listen to our entire menu as our options have changed…” At MRS, customers engage and interact with ADAM through conversation rather than by listening to menus and constantly pressing keys. While again, there is risk in deploying new technology, we believe the benefit is so substantial that it will revolutionize the way customers engage with us. Customers can now make payment arrangements, render a dispute, report a bankruptcy, to name a few, without ever having to speak to a live agent. They can also do so at times that are most convenient to them, including late into the evening or on the weekend. Countless hours have been put into quality control, testing, and training of the multitude of “responses” that create the overall user experience with ADAM.

Like with texting, our strategy has been to create layers of defense to try and mitigate risk. One example, is by always giving customers the ability to opt out to a live agent if they don’t wish to continue engaging ADAM. Other controls have been put in place to ensure that ADAM consistently gives the proper disclosures as well as verify the identity of the caller. As a further detective control, ADAM calls with customers are scored and evaluated with the same scrutiny and diligence by our quality team as those of the live agents.

Self-Help Web Portal

Customers can also engage us via our self-help portal on our webpage or even with live chat. Our goal is to give customers options that enable them to have more control in the collection process but also ensure that we are not exposing ourselves to unnecessary risk. For us, the rewards gained from our initiatives and strategies far outweigh those risks. It is also worth noting that, contrary to claims by some within our industry, not all customers are cut from the same cloth. Some prefer to engage us online, some prefer the less intrusiveness of a text, while still others prefer to engage ADAM. Then, of course, there are still those that prefer the traditional approach of speaking to a live human. We can now engage customers like never before and the results are a win for our clients, their customers, and those in our industry willing to take the risks.

Trying something different is often a little scary, and venturing into areas like texting and artificial intelligence can seem downright frightening with so much uncertainty. However, we all have collectively survived and thrived in the collection industry because we were willing to adapt and change with the times. The times have changed again and our industry has entered the digital age. Are you ready for it?

Jeff Freedman co-founded MRS in 1991. Jeff manages all aspects of the organization by providing direction to the Executive Team, Finance Department, and Legal Department; in addition to providing indirect oversight of Operations, Sales/Marketing, Human Resources, Training, Quality Assurance, and IT/Security.

Debt Collection Disrupted

  • Written by T. Steel Rose

rose steelDriverless cars are being tested and flying cars are predicted to arrive by some futurists in five years. Technological disruption is nothing new. How swiftly it changes an industry is the surprise.

Not that long ago there was no Uber or Airbnb. It’s now clear to see how they disrupted the transportation and hotel industry. Uber took an uncomfortable process (taxicabs) utilized a common asset (your car) and coded an engaging technology (your cell phone) to pay a much more pleasant driver to take you where you needed to go. Airbnb offered a similar proposition. They utilized a common asset (your home) and coded an attractive website for home and cell phone and disrupted the hotel industry. Amazon began with a similar proposition. They created a simple one-click ordering website for resale items like books.

When Uber, Airbnb and Amazon began they had one other silver lining in common. They all evaded taxes. Although, it’s really called tax avoidance until you cross the legal divide. Tax avoidance and paying debt avoidance have one thing in common. If the avoider is successful, someone else has to pay their way.

Venture capital is placing big bets on financial technology to disrupt uncomfortable processes. Take an uncomfortable process (reminding people they owe you) utilize a common asset (existing past due debts) and code an engaging website optimized for your cell phone, that incidentally has no tax consequences.

The convergence of the top accounts receivable professionals with the top technology providers for this necessary process will occur at Receivables Advisor’s CollectTECH 19, November 18-20 in Ft. Worth, Texas. This is not a new idea. CAT EXPO brought the best and brightest together for years. There, technological innovations were introduced. What we know as virtual collections was pioneered by Debt Resolve and Apollo. Ten years ago virtual collections was in its infancy. Now people are pondering when it will be the primary source for collections.

Future TECH

Talking like a futurist, I see two trends continuing: 1) First party and third party collection will be more integrated utilizing technology and, 2) text and email will become the primary methods for collecting past due debts.

My bold prediction is: those who support the taxing authorities will pioneer the future tech application for collections. Look to Massachusetts, California and New York City to follow Los Angeles in finding the next great collection technology solution.

I look forward to a day when someone who has lost the trust of creditors can be contacted, begin a payment plan and see their credit score improve each month. They can reach certain milestones and receive notifications like, “Congratulations, your credit score just improved to 600, you can be trusted to get a mortgage to buy a house again.”

There is something intrinsically fascinating about collections. When you loan someone anything or provide them a service or product in exchange for payment you are trusting them. When they violate that trust they have betrayed the trust you placed in them. When they can’t pay because of medical or other legitimate issues, we understand. When they have the means to pay but do not, and continue to violate the trust you placed in them, it stings.

Therefore, the business processing outsourcing of the collection industry takes on the hard work of asking people to be responsible and make payments toward what they promised to pay in exchange for whatever they received. It’s like parenting; you are reminding them they have a way to become trustworthy again. The problem is parenting is hard work. People don’t mind avoiding responsibility.

Top Receivable Professionals

This is an honorable profession built on helping people rebuild trust. Therefore we will continue our time-honored tradition of recognizing top professionals with an award ceremony at the conference. This year, after the Top 50 Professionals are awarded individually, the Most Innovative Agencies will be awarded and the Top 50 Products will be awarded. Then, the highlight of the evening, the Most Innovative Product, the Top Product and, drum roll please, the Professional of the Year. Be sure to cast your vote. See the ballot on page 28.

Tech Solutions From the Collection Floor

  • Written by Joshua Fluegel

Here’s a question: How many fellow collection professionals have you talked to lately about challenges you have faced on the collection floor? The vague but ideal answer would be: Many! Unfortunately, in an effort to a exude success many professionals will keep everyday struggles to themselves. This philosophy makes those struggles theirs alone. But sharing with others not only opens the door to valuable advice from fellow seasoned professionals, it also reflects favorably on the dispenser as a benevolent and astute member of the industry.

Receivables Advisor spoke with several collection professionals about challenges they have faced on the collection floor and how they leveraged their technological prowess and resources to overcome them.

What was a challenge on the collection floor and how did technology help your agency overcome it?

G. Scott Purcell
President of Professional Credit

purcell scottThe need we had on the collection floor was a technology platform with the flexibility to support a vast number of client interface requirements and to meet rapidly evolving consumer communication preferences. We have implemented a solution that allows us to achieve this. Our new AR management system, ARTrail, includes an EDI [electronic data interchange] subsystem, RoboDX, that seamlessly connects to both legacy and contemporary systems and handles any number of data configurations. It also provides interoperability with any communications platform, and manages workflows for consumer contact via text, email, IVR, telephone or letter.

Michael Ryalls
Chief Strategy Officer of RGS Financial

ryalls michaelWhen servicing sophisticated financial services clients, compliance is as important as performance. A great scorecard will not save you from poor compliance ratings. The challenge is managing QA [quality assurance] and collection performance on 100% of your contacts. CallMiner, with 100% speech analytics seems like a great solution, but we found it requires a high level of expertise to operate effectively. To achieve real results, you must train or hire internally, and both are very costly. After two years of trying, our solution was to partner with Provana and utilize their ICAP (Integrated Call Analytics Platform) product where they provide the know-how.

Howard George
CEO of Receivables Performance Management, LLC

george howard2Over the last few years Receivables Performance Management, LLC has noticed a shift in the behavior of the consumers we speak to: longer conversations that don’t result in a payment, and a shifting preference of younger consumers for a conversation-free solution to resolving their bill. Both of these challenges were addressed by an upgrade to RPM’s online payment portal. The new portal now serves as a full solution for consumers that prefer to resolve their bill on their own. It features the ability to setup full payment plans, settlements and a budgeting tool to help determine the right payment amounts.

Nate Kalnins
VP of Operations of The Stark Collection Agency

kalnins nate2Challenge: Gathering and integrating data

Solution: Our office has struggled at compiling usable data from our collection software and other outside sources and finding real-time, actionable insights from this data. Analysis could be done, but it required pulling programmers away from other projects to gather the data. To alleviate this problem, we began using Microsoft Power BI. This software allows the user to pull data from dozens of disparate sources (including our collection software, Excel, Access databases, web pages and more) to make the analytics-driven decisions needed to drive our business forward. Power BI allows for easily understood reports which can be easily generated without the involvement of a programmer.

Data Security Essential for Electronic Payments

  • Written by Joshua Fluegel

With all the facets involved in the collection process, it’s essential for a consumer’s first contact with the electronic payment system to be inviting. Marc Chibnik, CEO of Harvard Collection Services, revealed the keys to having a system that is conducive to accepting electronic payments.

chibnik marc“Three items are top of mind: integration with system of record, data protection and consumer communication,” said Chibnik. “Integration with system of record covers how the agency will manage payment detail and requires the agency to plan if payments will be brought in to the system of record individually or by batch. Data protection is the process the agency will use to insure that cardholder or bank account information will be protected at the agency to meet security guidelines. Consumer communication is the method that will be employed to notify consumers that electronic payments are accepted and that the communications are done in a compliant manner.”

Proper security to accept payment information relies on the Payment Card Industry Data Security Standard.

“Here are some easy steps to follow to improve the security posture of your organization,” said Erica St. John, CPA, chief financial officer for CBE Companies.

Protect Data

“Keep the storage of sensitive data to a minimum and add additional controls, especially encryption, to prevent data access. Implement technologies to encrypt data at rest and data in transit. When encrypting, use strong and validated cryptographic keys and algorithms and ensure that the keys used for unencrypting the data are tightly controlled and protected.

Regularly Test Security Systems

st john erica“Data protection must be managed on an ongoing basis and built into your organization’s daily business operations. New vulnerabilities appear constantly which means you must always be attentive and routinely assess and remediate security threats to processes and systems. Use a risk-based approach to continuously identify and remediate threats in a timely and cost-effective manner.

“Auditors require evidence of how organizations are meeting the requirements of multiple regulatory mandates, industry standards and compliance frameworks. Maintaining a vigilant policy compliance program enables companies to reduce risk and continuously provide proof of compliance. Additionally, a policy compliance program helps identify and assess key security settings in your systems, which expose new security related issues and promote discussion for new or revised policies and procedures.

Train your People

“At the recent 2019 RSA Conference, a common theme was that security depends on people. More so than technology or policy, it’s the people in your organization who have the greatest influence on the success of maintaining an organization’s strong security posture. The threat is not always disgruntled workers and corporate spies. Often, it is the unwary, careless employee who can do harm to your network by visiting websites infected with malware, responding to phishing emails, storing their login information in an unsecured location, or even giving out sensitive information over the phone. One of the best ways to make sure employees will not make costly errors regarding information security is to institute company-wide security awareness training initiatives.”

While such a process is as ironclad as one can hope for, it is not one-size-fits-all. Collection professionals must determine what is applicable to them.

bedard john“The law does not treat all electronic payments the same way,” said John H. Bedard, Jr., managing attorney for Bedard Law Group, P.C. “Collectors accepting preauthorized electronic funds transfers should pay special attention to the consent requirements imposed by law on those transactions.”