How to Get the Most Out of an Industry Conference

Why do you attend ARM industry conferences?  To learn new techniques, view technology, discover new vendor solutions, visit with clients and others in the same situation as you, and maybe, just to see the beach, casino or other landmarks.  Conference organizers entice attendees by highlighting famous people as speakers, offering continuing education credits and networking opportunities. The question becomes how effective can you be in two days if all these things are on your “Must Do” list?

Most people I speak with try to meet these obligations by creating a structured schedule. You will hear someone say “I have twenty or thirty meeting set up” or they are rushing from one meeting to get to the next one. My question is just how well prepared were they for that meeting? Every meeting is an opportunity and should be treated as one of the most important parts of your research and marketing objectives.

I have meetings with many potential clients or partners that are very non-productive and a few that are very productive because both parties are well researched. So let me outline a few KPI’s of a great conference.

  1. Be prepared for each meeting:  When I can get a potential consulting client to perform my online assessment prior to the meeting and to spend a few minutes on the phone prior to the meeting it helps to prepare both parties. By identifying opportunities for improvement, as well as a high level view of the business, provides me the background needed to make recommendations.  If you research a new vendor and take the time to call some references prior to meeting them at their booth you will be more prepared to take action.
  2. Meet with the right people:  By doing your research you can make sure you are talking to the right person. Whether it’s a letter vendor, asset location vendor, client representative or another conference attendee take the time to make sure it’s the right person.
  3. Listen:  You can’t learn if you are doing all the talking.  Take the time to let the meeting progress, Listen intently and then ask questions designed to uncover issues that didn’t get addressed. At a conference, you schedule will be packed and unscheduled meetings will surely occur, but if you have done all of your homework, your meetings will be more efficient, and you will learn more, and you will have more time to get to know the other party and build a relationship. Remember, it’s the right person and the right vendor, client or attendee that creates a successful working relationship.

Over the years, Lighthouse Consulting has been closely monitoring the industry and evaluating dozens of service providers to help our clients make the most informed choices when choosing the best vendor, process or solution for their business.  Add one more appointment to your schedule at the next industry conference and spend a few minutes with our CEO Phillip W. Duff to ensure you get the most out of your vendor evaluation process.

Thoughts, Opinions and Trends for 2014 – Part 3

In part one of this series, I focused on the need to analyze the profitability of various clients, market verticals and lines of business as well as introducing you to some powerful collection technology tools utilizing artificial intelligence to improve recoveries and demonstrate compliance.

In Part 2 of the series, I outlined the changing compliance landscape and discuss the need for an effective complaints management system.  I also covered the important topic of staff straining and development to improve the profitability of your business.

In the final installment of the series, I want to focus on what I see are the trends, challenges and opportunities that lie ahead for the ARM industry in 2014 and beyond.


Law Firms

If you are a law firm in debt collections today, it is my opinion that you have two choices to stay in business and thrive. The first is to use all the suggestions above and practice in multiple states in a broad multi-state strategy.  Partner if you must, acquire if you can, but in order to be successful going forward, you will need to have a multi-state strategy in order to thrive.

The second is to do everything outlined above and focus on a slightly smaller regional footprint of just two or three states; depending on the size of the state obviously.  Either way, you have to leverage technology to become more efficient, more compliant and more profitable.


When I entered debt collections in the late 80’s there were just three collection agencies that owned all the national business, ACB, GC Services, and Payco American.  All the rest of the agencies were small mom and pop shops and a few larger regional players thrown into the mix.  In my opinion, I think we are headed back to that type of model.

There will be fewer big agencies that will have the national business, large compliance budgets, large revenue and low margins and then there will be smaller regional agencies servicing the small institutions.  The smaller agencies and mom and pop shops will do just enough to check the compliance box, but not nearly enough to survive any level of regulatory scrutiny.  If they get out of line in the slightest way, they will be crushed by the cost of responding to a civil investigation demand by the FTC or the CFPB and they will be out of business in 60 – 90 days whereas the large players will have dedicated line items in their budget for settlement agreements related to non-compliance and the cash flow to pay the toll.  Going forward, it’s just a cost of doing business in the new regulatory environment.


While we have seen some loosening of lending policies to consumers of late as evidenced by the amount of new debt consumers are currently taking on, the large banks will continue to maintain strict underwriting guidelines for new consumer debt and concentrate on commercial lending instead.

As the issuers continue to shed risk across their organizations, banks will continue the move to in source their operations by 2015 and reduce the number of approved vendors they must approve, audit and manage.   The result will be more 4th party and 5th party vendor relationships, essentially servicers who service the servicers.  While the requirement to audit and maintain these 4th and 5th party relationships is not removed from the issuers, they will push down to their 3rd party vendors to take on the effort of auditing, monitoring these vendors to reduce their burden and cost internally.

I think we will continue to see strong growth of regional banks and the mergers will continue to create some strong regional players by 2015-2016.


In an effort to find new and fertile opportunities in collections and to reduce some of the regulatory burden associated with collecting from consumers, many agencies and law firms will try move into the commercial sector. With an absence of expertise in this space, many will fail.  The micro clients are too difficult and time consuming for most servicers to understand and deal with. The large companies placing commercial accounts will become inundated by agencies and law firms soliciting their business, putting pressure on margins and making the landscape extremely competitive.


I see the Healthcare Sector as the sector poised for the strongest growth in 2014-2020. With the continued implementation of Obamacare in 2014 and beyond, consumers will be faced with higher insurance premiums that will put additional pressure on household budgets.  Higher co-pays and deductibles will increase healthcare debt and credit card debt by late 2014 and beyond. As consumers face out of pocket costs and co-pays of $200-$300 for a single office visit and round of prescriptions and annual family deductibles of $5,000, $7,000 or $12,5000 or more, consumers will be forced to finance their increased healthcare costs on credit cards or payment plans extended by the medical practice.  The problem will only be compounded in late 2014 and 2015 as insurance premium rates increase in 2015 and more and more employers dump employees into the healthcare exchanges or move them to private plans by dropping them altogether.


Vendors must be looking for opportunities to help the clients survive and thrive as well as comply with the regulations and requirements of today’s environment. Vendors need to be proactive and anticipate the needs of the clients they will serve in the coming years.  They themselves are subject to most of the very same regulations that the largest debt buyers and agencies are subject to and they need to project a strong presence of compliance and a clear understanding of how to operate in the new regulatory environment.  Vendors that have been through a major security audit from a Tier 1 bank understand the questions that will be asked and the information and documentation that must be provided.  Therefore, create the required Security Audit documentation today and if you have not already been contacted by a service provider to provide this information, reach out in advance to schedule time to share, present and discuss your company’s compliance posture and the programs you have in place to document these programs.  If you show your client you are serious about compliance and even more serious about reducing their burden to audit and monitor your company, the effort will not go unnoticed and will be greatly appreciated I assure you.

There are many vendors that are taking this position today and I suggest you align yourself with those vendors. Contact me for specific suggestions.

While we face many more challenges today than we did a decade ago, there is still plenty of opportunity out there for agencies and law firms that are willing to do the work and get out there and find solutions.   Complacency is the greatest enemy in just about any business, so don’t worry about the competition.  Although many people will likely read this blog post, few will take action or do much if anything to change the trajectory of their business.  For those that do, the effort will be significant, but the rewards will be as well.

Thoughts, Opinions and Trends for 2014 – Part 2

In Part 1 of this series, I focused on the need to analyze the profitability of various clients, market verticals and lines of business as well as introducing you to some powerful collection technology tools utilizing artificial intelligence to improve recoveries and demonstrate compliance.

In Part 2 of the series, we’ll carry on the discussion relating to compliance, and discuss the need for an effective complaints management system.  I’ll also cover the important topic of staff straining and development to improve the profitability of your business.


So you have a set of Policies and Procedures, but how do you truly demonstrate compliance? Yes, prove it is actually happening.  As a matter of fact, the regulatory requirement goes far beyond just having the policies and procedures.  The regulators actually want to know that you are training staff to these procedures, monitoring your staff’s compliance to the procedures and that you are making adjustments in the ways your company does business to become more compliant.  This part becomes a little tricky, but can include things like self reporting violations, amending policies over time in response to consumer complaints and other types of documentary evidence that supports changes in operations driven by compliance policies and procedures.   The SOP’s you have been compiling over the last 3 years are not demonstrating compliance, they are merely documenting you have defined certain rules.

There are numerous compliance certifications available, depending on how your business is classified, how it operates and what industries or markets it serves.  Some certifications deal with information security, while others deal with consumer privacy and still others deal with how your employees deal debtors.  Some are application or software specific, like a PCI DSS 3.0 certification, while others are operations specific like a SSAE16 or ISO 9001 certification.  Going further, some states have even developed their own standards such as the Minnesota Plastic Card Security Act or the Nevada Personal Information Law NRS 603a.  In order to develop a comprehensive compliance strategy, you need to assess who you do business with, where you do business and what federal, state and local statutes, licensing and compliance requirements will apply to your business.  Only then can you create an over arching set of policies, procedures, training and monitoring programs that will sufficiently demonstrate compliance to a regulator.

While SSAE16 SOC 2 is the certification that most broadly applies to collection agencies, debt buyers and collection law firms, there are other certifications that you may need depending on your business model. A third party security auditing firm may be able to provide a multi-level, State and Federal compliance certification that can provide a broader set of certifications and reduce the cost of the initial and annual recertifications over time. Tech Lock is the preferred vendor in my opinion for the multi certification programs in the ARM industry.

Complaints Management System

Do you have a consumer facing complaint management system on your corporate website? Not only is this the best way to monitor, manage and control complaints, but having a complaints management system is now a regulatory requirement for collectors.   And not having a clear and obvious way for consumers to direct complaints to your company through your corporate website or other consumer facing website can invite scrutiny from regulators.

Furthermore, if your company is the first point of contact regarding a consumer complaint, as opposed to the consumer logging a complaint with the CFPB, FTC or state AG, you will fare much better with any regulatory taking a closer look at the complaint if you were the first point of contact and can demonstrate the actions you took to resolve the complaint or change the process within your organization that resulted in the complaint in the first place. If you have not yet implemented an effective complaints resolution system, call Lighthouse Consulting today.  We can help you implement this.

Staff development

My clients say all the time “You can’t teach my staff anything they think they know it all”. If your staff tells you that, fire every one of them immediately. And if you think your staff can’t benefit from additional training and coaching, then fire yourself. And finally, if you think you have staff that can benefit from additional training or coaching and you have not already done it, then you probably can’t do it or at the very least, you are not the best person to try and do it.  Call Lighthouse Consulting or hire a different training consultant right away, because you are leaving money on the table.

Your staff wants to be trained and developed into the best collectors they can be but you are the one holding them back by not providing them the opportunity. Chances are, the younger your staff is the more they desire to be developed and vice versa.  Do you have staff that has been with you forever and now is overpaid and underperforming? Guess what, this is hurting the rest of the staff and your business by deploying cash resources in the wrong direction. The collections business today requires capital to create improvements, increase technology, develop staff, address compliance, and market the business in order to grow. You have to be strategic about the investment you make in human capital resources and you have to measure and analyze the return on that investment constantly.

Reduce the staff and Automate!

The ARM has gone through many major transformations in the past decade as a result of technological innovations.  We have seen computers bring greater efficiencies on collection management, call management and analytics and modeling tools have helped identify the right accounts to target at just the right time.  Manpower is being replaced with technology that allows fewer people to do more at a lower cost.

If your firm is not performing a technology assessment and review annually, you are likely not remaining relevant.  Technology changes quickly, and new companies come on the scene with exciting technologies that can drive efficiencies for the average collection operation.  In the market today, you need to use all methods possible to automate the collection process!  If you have not performed a technology audit in your collection operations in the past 12 months, call me today!

Taking advantage of Intelligent Collection Software from Quantrax that can make decisions like a human collector and prevent a collector from violating a compliance policy.  There are great online payment sites that can update the consumer’s address, get the consumer’s acceptance to receive emails and text messages, negotiate with the consumer at 3 AM for a settlement and take the payment online without having to pay a collector. And with an abundance of data and analytics tools and services to the industry today, you can find a set of data, a collection model, or a third party data source to help optimize collections in any debt asset class.

Thoughts, Opinions and Trends for 2014 – Part 1


In this three part series, I will share some of my thoughts and opinions on the industry and where we are headed, as well as outline some trends I see in different areas that may help prepare you for the future. 

In Part 1, I will discuss the importance of analyzing your client base and measuring the profitability of different segments or clients as well as touching on some highlights about emerging technologies that can drive efficiencies.

In Part 2, I will address the challenges of compliance everyone faces today and further expand on the need for an effective complaints management system.  Also in Part 2, I will focus on the importance of staff training and development, not only to demonstrate compliance, but also to better measure performance and profitability.

Finally, in Part 3 of the series, I will outline a number of trends, opportunities and challenges that I feel lie on the road ahead for the ARM industry in 2014 and beyond.


The industry is changing quickly and if you want to succeed you can’t wait for the issues to work themselves out.  You have to act and quickly!  If you believe this statement, then quit reading this article and call me now at 904-687-1687 and let’s discuss how to take your agency or law firm to the next level.   If you are still reading then let me explain a few of the industry trends and the solutions ARM companies should be deploying during these challenging times.

Client Base

What does your client base look like? What are the unit yields of each client? Are your placements growing or falling off? Do some of your clients have growth? What sectors of your business are growing?   Ok, now you have a fair idea of what is going on.  Now it’s time to evaluate if your marketing focus is directed at the right clients.  Maybe you need to move away from debt buyers and get some regional bank business. Or maybe your healthcare clients are more profitable and you see this market segment growing under Obamacare.  Undergoing a deep analysis of the individual lines of business and market sectors is critical to maximizing your profitability.  Developing a process for measuring the profitability of each segment of your business, and using tools like executive dashboards and analyzing how legislation and regulations impact your profitability are critical.

Just as a simple example.  If you believe the implementation of Obamacare is going to drive healthcare premiums higher for many consumers, force a larger portion of consumers away from employer sponsored healthcare plan and into individual plans and increase out of pocket expenses by shifting higher and higher deductibles to the consumer, then you would be acting right now to take the necessary steps to enter the healthcare collections space by becoming compliant under HIPAA, hiring a sales team to aggressively go after large healthcare organizations and large doctor groups and implement systems and training for your collectors to optimize recoveries in this vertical.  The investment is high, but the payoff could very well be equally as high.  The key here is seeing market trends well in advance of your competition.


This is a sticky area with most of my consulting clients. The last thing anyone wants to do is change software vendors or add software. Why? It’s because of the pain points associated with the conversion.

Most vendors have historically made that change difficult; cell phones are a perfect example. Years ago it was so difficult to change cell providers due to the pain of moving the contacts, images and other data on the device so most consumers just stayed with the same provider for years. Now the providers can move your data in minutes from any provider or phone.

The other problem with the software has always been making changes to the system.  It requires a lot of planning, custom programming costs and hundreds of hours dedicated to the competition of the project.  Well, the smarter software providers have changed that pain into pleasure by doing complete conversions in 60 days and building user defined systems that allow the end user to adapt the software to their business practices not the other way around.  If you want to see intelligent software at work check out Quantrax ( and for more on technology, see automation section below.

In the next installment of the series I’ll focus on Compliance, Complaints Management as well as Staff Training and Development.  I will also outline the importance of performing an annual technology review and audit to ensure your collections operation is taking advantage of the latest technologies available in the industry today.

Hiring a Consultant is like Going to Rehab

Nobody wants to do it even though they know they’ll be better on the other side

I have been a consultant to the debt collection industry for over a decade and it still amazes me why so many CEO’s, owners, managing partners and staff are resistant to change. Despite the fact that they all proclaim loudly that they need to find new and better ways to perform many tasks, most will not do what is required to make the move to change. It is like the person who knows they have a drug or alcohol problem and agrees the best solution would be to go to rehab to learn new ways to manage their addiction, but never follows through to make the commitment to do the hard work to actually get better.  Over the past decade, I have met with and analyzed many companies purchasing and collecting debt.  I have had extensive discussions with CEO’s, managing partners and staff who all had no problem identifying areas of the business that were in serious need of improvement, but most of the time, they fail to follow through to make the commitment to do the work to achieve their intended goals.

The clients that finally call me to work with them to improve their businesses usually tell me they wish they had done it much earlier, just like the person completing rehab proclaims they should have gotten clean much sooner. So why are these very smart, successful CEO’s, owners and staff members so hesitant to change?  It is part of the inherent entrepreneurial traits that are needed to be an owner or managing partner of a collection entity. These individuals have gotten where they are based on their knowledge and drive, and most have done it on their own. Few successful people became successful by relying on other parties to help make decisions about their company’s direction, but those that have sought wise counsel along the way are usually more successful than most.

Recently, while speaking with a prospective client, he made a statement that really cemented this hypothesis in my mind.  He said, “I have a CPA, MBA and Law degree and after all that schooling I learned just one thing. The only way to learn something is to learn from other people who have already done what you want to do.” This was quite a statement from a very successful debt collection lawyer and it’s very true. As a consultant I have learned the same thing, and most of my knowledge and skills I have acquired over the past 20 or so years has come from my mentors, other consultants that I learned my craft from and my clients.

With every consulting project I complete and every conversation I have with industry professionals I learn something. I possess the level of knowledge that I have only from those interactions. The advantage that I have over most owners and CEO’s in the industry is the sheer number of agencies, law firms and issuers I have worked with over the years. In my career as a consultant and previously as an auditor I have probably worked with over 200 clients. Whether I was engaged as an auditor or as a consultant, these agencies and law firms have opened their processes up to me and I have been able to quickly determine which are best practices and which are liabilities. While each client is unique in some way, the things that work usually work for the vast majority of clients, and the mistakes that are being made are usually made by most of my clients as well.

I can name several debt collection entities that have embraced the idea that they do not have all the answers and have used consultants, staff and any other continuing education programs to remain relevant, competitive and profitable. The most successful have small egos and a big desire to learn and grow in a market that continues to be more and more competitive. I have seen improvements of 10%, 20%, 40% or more from companies that have routinely utilized outside consultants to help them, as opposed to those that relied only on the CEO’s vision and existing level of knowledge.

So why are some willing to embrace change and the search for better processes and others not?  Let’s discuss the unwilling first.  They generally know that change is required or at least needed, but they either think their staff will not be responsive to change, or they believe that the change will be too costly from a financial or time perspective. Many times when I meet with a prospective client at a conference, they have an excuse as to why engaging an outside consultant to address operational efficiency won’t work; just like the person who is resistant to commit rehab. If you think your staff is reluctant to change, fire them! If you believe the change is too costly, see what happens when you do nothing in today’s marketplace. The reality in today’s market is that fewer and fewer firms are competing for a smaller piece of the pie.

When you look up the word change in the dictionary, it speaks of modification, altercation, amendment, transformation, conversion and revolution. Change can be voluntary or involuntary.  The collection industry is now undergoing involuntary change at the hands of regulators because it would not change voluntarily. Sometimes it takes a revolution to create change and sometimes it just takes desire. The CEO’s, staff and managing partners that embrace change will see drastic improvements that will be positive for the business, the owners and the corporate culture while the companies that are changed involuntarily will see negative impacts on staffing, process and culture.

If you desire to make change to your organization, culture, profits, process, attitudes and longevity, then embrace change and look everywhere for it. Hire consultants, read books, attend conferences and find ways to learn and change. If you desire to keep talking about change and never doing anything to reach your goals, then prepare yourself and your company for defeat in today’s marketplace. Today the industry is waiting for the few that will survive and thrive in the new collections environment.  Will you be one of those coming out on top?