Problems with hiring quality staff? This works like crazy!

As a consultant I have my finger on the pulse of the debt collection industry but even a layman can see that hiring staff is the biggest hurdle in the US today. The $12-$15 hourly employee in the US is a difficult group to hire and train. First they really don’t want an entry level job and they feel they already know everything so training is tough.

Many of my clients come to me to solve this issue and I tell them It’s a social issue not a business issue. I can’t fix the world, I can’t fix the way these employees grew up, but I can fix the problem.

Yes I can fix it by inserting a different culture of staff. Now your wondering where in the United States I will find a different culture than what seems to exist in every City and State in the US. Well the new dilute is not in the US it’s in Jamaica. These employees have none of the same sense of entitlement of the US staff. The staff in Jamaica are happy to have a job and want to be trained.

Lets back up some now. Call Centres are the second largest industry on the island of Jamaica. Vistiprint, Xerox, Fingerhut, AT&T, Verizon, Direct TV and hundreds more have call centres here. Why you ask, great labor rates, great staff and English speaking. Honestly its the ROI. So the idea of a call centre here is not a new idea and the staff have been working different campaigns for decades.

So how do you take advantage of this labor pool without having to figure out the new culture and a new country to do business in? Lighthouse Consulting Jamaica can provide a turn key solution to you as cheap as $10 hourly including labor, technology and support. Yes for just $10 hourly you can get;

An employee

Computer station

Hi speed Internet connection

Cubicle

Chair

IT support

HR support

So thats an all in cost of just $1600 a month per seat. So that collector has to collect just $1600 in fee to break even. I bet your number in the US is 3X to that number or closer to $5000.

All this and the staff are really more trainable and more willing to work. This is how you solve your staffing problems.

Now your saying “but my clients won’t let me outsource to another country”. Well its not outsourcing the way I help you set this up its your office, you own it. Lighthouse is just your landlord, IT and HR support. The office is in your name, Ill show you how to set up everything you need to open your satellite office in Montego Bay or Kingston, Jamaica.

Call Phillip W. Duff now for more info at 305-853-8773.

My Life In Jamaica And The Heat Of Summer

Well its July in the Caribbean and its hot, not as hot as it’s been in the Western US but it is hot. In Jamaica air conditioning is a luxury not a expectation. Homes here traditionally have AC units only in the bedrooms. Most locals have no AC as electricity is one of the more expensive things on the island. There are no natural resources to burn to run electric plants so Jamaica ships in natural gas from the US to run its plants.

So since my last post lots has happened and a lot more has just gotten delayed in government circles. I have been trying to get all my local docs such as a drivers licence and it is just a big circle of bureaucracy. So to get a new bank account open I needed to register with the NIS office, the National Insurance Scheme. I gathered my local friend/guide and proceeded to the NIS office to get the simple doc which I was told only required proof of your birth to get. I had had my guide go to the NIS office the Friday before to make sure what was required so as not to waste a trip. The following Tuesday we went to the office and it had moved and no-one knew where the government office had moved to. We kept asking people in Sam Sharpe square in Downtown Montego Bay where the NIS office was located a couple days earlier and got a lead as to the new offices location.

Upon arriving at the address given we found a hardware store that reminded me of a big Ace Hardware or a small Home Depot. We abandoned that search and moved on to the next thing on the list buying a TV that I will use as a computer screen at my home office. While we were there we called the NIS office and got no answer. But the guy in the store had a cousin that worked there and called her cell phone to find out that the office was really inside the hardware store from before. We proceeded back to the hardware store and located the temporary office, they are remodelling the one in Sam Sharpe Sq. but they had no phones or computers and could not help me get a NIS card, they suggested I return in a week or so. Welcome to Jamaica.

I was able to get the card in just 20 minutes while visiting Kingston the next week but the drivers license is still in the works. I am getting used to all the delays and hurdles as well as its now my expectation it will take a long time to complete anything so when something happens easily I am surprised and if it takes all day I am prepared as I blocked out the whole day and brought water and snacks.

I spent lots of time last week listening to recordings of the collectors for a particular project that is about 6 weeks into production and was very impressed with the staffs skills. They are performing very well kudos to the clients trainers that came down from the US.

Well Sumfest http://reggaesumfest.com is starting, its the biggest Reggae event in the world, 7 days of music and partying. Its based in Montego Bay so I expect lots of traffic and crazy US and Canadian tourists. Its good for the city in many ways but I like that everything is getting cleaned and painted for the event. It seems like some of these areas only get this attention annually but it really helps the look of the city. All the businesses have new signage, streets are cleaned and curbs have fresh yellow paint. This years festival is the biggest ever.

So if your following this blog your likely interested in agents in Jamaica and this blog shows how valuable my program is by guiding you through all the government hurdles and keeping your costs level even if things like the electric bill increases drastically. No matter what happens your costs are consistent with my program. Call me to learn how you can have staff and overhead in Jamaica at just $10 hourly.

Where’s the elephant hiding in your business?

When I first began helping my clients open up their collection offices in Jamaica it became apparent that that the obvious is often hidden. The problem its hidden from us by our own prejudices and things we have always been told. About a year ago a girl on the island said to me in answer to simple question something that has stuck with me and fits so many situations on the island. She stated “It’s cheaper to buy 50 paint brushes than a paint machine”.

What was meant by the statement? Well in Jamaica labor is cheaper than a machine and it does not require gas, maintenance and does not break down. As Americans involved in the debt collection business we know that the biggest line item on your P&L is labor. We have always been taught this and we believe it but the truth is “Its the Elephant hiding in your business strategies”.

hidden elephant_4ac1e49e108f3.jpg

Labor is cheap and ultra effective in Jamaica. The call centre industry is booming and has been the number two industry on the island for decades. Tourism in number one of course but Xerox, Vistaprint, AT&T and many more American call centres are based in Jamaica. There is said to be 1 call centre worker for every 10 people. The Jamaican staff that I can help you hire are very trainable unlike their US counterparts. The staff being hired in the US as collectors these days are difficult at best but you already know that.

If you own or run a collection operation in the US you should call me to discuss how you can reduce that labor line item and gain a better staff member at the same time. I can help you set up seats for as little as $10 USD per hour, per seat. That means you just need to recoup $400 in fee to pay the costs for a weeks work and facility charges. After that your in the profits on the total costs. The great thing is that for the $10, I’m including the internet connection, computer equipment, IT, HR and cubes in that cost. It is all inclusive!

Come down and look around. Let me show you other shops. Look and you will be doing business in Jamaica. Ya Mon!

Silence Is Golden And Duct Tape Is Silver

As a consultant to the debt collection industry one of my duties is to create and perform collector training classes. I have been doing this for many years and a few years ago I came to a realization which lead me to change my training.

It was hard to get collectors to embrace this new technique as it was revolutionary to them. They resisted and would revert quickly to their old habits but the first few that listened and got the concept were seeing the results in increased liquidation, more debtors would agree to pay and it reduced time on the phone and frustration.

What was the new thing that was so hard to teach collectors, SILENCE. Yes to try to teach a collector shut up and listen is not an easy task but what they will hear will change the direction of the call quickly. At times when I first started teaching listening skills I wished I could put duct tape over their mouth right after they finished the Talk off. Instead I began to teach them to use the mute button. The real trick is not to get them to push the mute button but to LISTEN.

It was listening skills I was trying to teach but collectors are hired to talk and most can talk your ear off about nothing.  So I had to first just get them to shut up so they could listen and hear. What I had learned many years ago from both my experiences and from others in industry is that if you will listen long enough the debtor will suggest a solution.

Here is what I learned, If you tell the debtor that the balance in full is due today and then hit your mute button the first thing is awkward silence, then the debtor will say he cannot pay the bill in full its impossible, then more awkward silence and the debtor says why he can’t pay “I am out of work” or “I am on disability”. This is followed by more excuses and more silence till finely the debtor says “Well I could pay you $5 a month if that helps”. OK now you have achieved the desired results and now the collector can begin to talk and negotiate an arrangement to repay the debt.

What happens is amazing as most people will follow this pattern if you can listen long enough. Remember your last statement was “The bill is due in full today” so thats starting strong. Even though the debtor is starting very low he is now ready to make arrangements and the skills of the debt collector will get the BPA or best possible arrangement.

So teach this method and try this when you hear the staff not listening go by and put 4 inches of duct tape on their cube to remind them to listen.

Silence is golden and duct tape is silver but listening is where the money comes from.

It’s not how you skin the rabbit, it’s how the rabbits fur grows back.

Well first of all I do not suggest you try to skin a rabbit thats alive so don’t send me letters. But there some meaning in this statement like many folk sayings across the US. If you are in the debt collection industry this relates to your business like this.

The biggest change in the debt collection industry over the last few years are the strategies used to collect the money. In the past the industry had 2 clear channels to get payments from, mail and phone so they sent letters and made phone calls. Well anyone in the industry today knows that letters do not collect near the numbers that did even 10 years ago and phone calls have so many compliance issues its hard to justify making that outbound call to a debtor.

So we have created more ways or channels for the consumer to pay. We have changed how we skin the rabbit because we need a sustainable business model. The debt collection industry has adopted self cure options to allow the rabbit to skin itself. So with a website that allows the consumer to go online 24/7 and pay their bill without any human interaction has allowed the consumer to skin themselves. And if we have done a good job they will continue to enjoy the experience of self skinning and will do it again and again. The self skinning allows the consumer to grow back the fur and then come back again for a trim without all the phone calls and letters.

So now if you want to be the most successful you can be you must perfect your self cure strategies so the consumer returns or so the consumer completes the transaction. Your payment site and all leading up that first consumer log in have to all be the best strategies possible these days as you may only get one chance to get this consumer to self cure.

Lighthouse Consulting created self cure and has the industry embrace it. If your interested in how to build a best rabbit self skinner in the industry you must talk to Lighthouse Consulting. Call Phil at 904-687-1687 now.

If there is an elephant in the room, I brought it

As a consultant to the debt collection industry I spend lots of time looking at other peoples businesses and telling them what they are doing wrong. Its quite a balancing act to tell a successful business owner how they have screwed up. It has always reminded me of the old statement about a elephant in the room and no one notices it. The problems in most businesses look so obvious to me I am wondering why they can’t see it of even if they do see it why they don’t fix it.

Well this is what drives my consulting business so I should be used to it now. So how do you see the elephant in your business? Try these 3 things to help you see the elephant in the room.

The restaurant business consists of 2 primary factors that will gauge the success of the concept, food and labor cost. The rent and the cost of utilities stay fairly steady but labor and food costs will fluctuate with the seasons and with the volume of customers. If you want to be successful you always keep a eye on these two areas to be successful in the restaurant business. Debt collections has similar key factors as well.

The first checkpoint is your cost per seat if your cost to do the business is high then all your unit yields have to be high and this is a hard thing to do these days with the low liquidity of most placements. If you want to explore how to calculate your cost per seat then give me a call.

Next is your unit yields or the actual dollar value you collect per account placed. In other words if you got 100 accounts that equaled $10K in face value and you collected $1000 in total then your unit yield would be $1000 divide by 100 accounts or $10 unit yield. So just like your cost per seat if your unit yields are too low then its another sign you have a problem. A good unit yield is $13 but some companies that work very lean and have lots of volume can make money with $8 unit yields. If you want more info on your unit yields call me at 904-687-1687.

And third KPI is the processes you are using. This is not a easy thing to measure like the cost per seat but it will highly effect your cost per seat and the unit yields. If you not using the best and most efficient process to collect the debt your wasting money and leaving money on the table both at the same time. My consulting services can help you get the most out of your business give me a call.

Are you brainwashing your staff to fail?

As a consultant to the debt collection industry I get to see many different companies and law firms do this business and it amazes me just how many owners/managers are hindering their staffs growth. The limits of any group are created by the person at the top and often that person has created a ceiling that he/she cannot pierce. How do you break this cycle? ,

The problem lies in the fact that all your insecurities are displayed on your staff, 10 fold. They look up to you but they see that you have created boundaries for yourself and the company and just like they try to emulate your good points they also emulate your bad points, in spades. So here are three things you can do to break the ceiling.

First you must open your mind to everything. You create a ceiling so that you don’t get wet, so there is a feeling of comfort because you are staying in your comfort zone. If you go past that ceiling you will be in new space with unknown consequences. You have to be like Capt. James T. Kirk from Star Trek and “Boldly go where no man has gone before”.

You must find ways to open your mind to new ideas and then to not just discount them because they are outside of the ceiling and might get you wet. Your mind will play tricks on you unless you make efforts to change the way it controls you. You will need new ways to get ideas and vet them. I suggest using a consultant or industry expert to guide you until you have gotten used to getting wet.

The second thing you must do is express your newfound beliefs to the staff. You must find ways to change the perception that there is a ceiling and that those boundaries define the options. It may take a consultant to help you change that culture but once it is changed the company will be positioned to pass the ceiling.

A great resource for you to try new things will be your current staff, once they see that you have changed your tune they will begin to be creative themselves and will be able to see many more opportunities for improvement than they did underneath the ceiling. Now you must create opportunities for the staff to express their new found freedoms, set up workshops with he staff to explore and create those new ideas.

Try this, pick one person from each department (not the managers) and ask them to work together to answer this question. “If we had to do this job and 1/2 of the consumers were deaf and the other 1/2 were blind how would we have to change our processes?” This will force the team to think “outside the box” or “without a ceiling”. Its a simple exercise but you might be surprised in some of the ideas that actually make sense in the real world of consumer behavior. Hell, most of the consumers might as well be deaf and blind based on their behaviors, LOL.

Lastly you must not let it happen again. This is likely the hardest part as your natural impulse is to create that ceiling so that you feel comfortable. As you perform the exercises above you will remember why you are doing them and the intended purpose but when a new opportunity arises you will automatically create the ceiling and not even consider trey opportunity as possible. It will take time to see that the ceiling is the problem and to change your unconscious behavior.

I have made a living helping people like you overcome these ceilings, call me if you need guidance

Q: Why are you holding your company back? A: Its your limitations, the ones you set for yourself and your staff.

Where did you get these limitations from? 

Unfortunately you were taught these limitations by your bosses, the industry and your even your mentors. From the first day you entered the industry people told you what you can’t do or what was not allowed by regulations and seldom have they told you WHAT TO DO.

And there is a deeper layer here also, you have taught all the staff that work for you where the ceiling is. By your actions and reactions to suggestions and new ideas you have stifled the staff with your limitations. In fact you have ingrained them with all the same faults you have. If your successful you have likely done a great job at your brainwashing your staff to see the ceiling.

But aren’t boundaries a good thing? 

Yes but not ceilings. This is not a boundary issue its a issue that the decisions you are making are creating a ceiling that you cannot break through because you will not let yourself do so. You have created a false sense of well being knowing that you cannot pierce the ceiling and since you bump up against it often you must be doing a great job, but no.

Just because you are hitting the limitations you created for yourself and your staff does not mean anything but that. You have created and installed limitations that are hindering new ideas and strategies and its now a issue.

How do I break thru the ceiling? 

Find a better mentor. There are many ways to learn new behaviors but doing it with the help of an industry veteran that understands how to break through ceilings will be the best route. See you have to remember that you taught all the people that work for you where the ceiling is and they also believe they can’t pierce the top either. So changing the behavior of the company is a culture change that requires a professional.

How can someone else change the culture in my business? 

Professional consultants like myself have learned that culture change is what consulting is all about. Its not really about the changes in process or procedures its a change in the mindset of the company. I have told this story many times but my first consulting job in 2000 scared me to death, I was not sure if I was going to have better collection strategies than they were using. As it turned out the improvements were the easy part, they were staring me in the face, the idea of how to tell the owner that his business practices suck was the hard part.

I learned that day that culture change, from the CEO down is what consulting is all about. And it was about how to change the mentality of the company that made it work not the actual process and procedures that I suggested changing. The processes made the company more efficient and profitable but the change in culture was what made it grow and break through the ceilings it created for itself.

If you have created ceilings that are hindering you today give me a call.

Did the birth of the “consumer” and the death of the “debtor” kill the debt collection industry?

As the debt collection industry has tried to be more consumer friendly we changed our vocabulary from “debtor” to “consumer”. How has that also changed the industries mindset? Is it a good thing?

I think not.

It was hard for me to change my vocabulary a couple years ago but it was willingly I did so. As the market started using the word consumer over the word debtor it seemed appropriate. But the longer this has been in effect the more and more I see it affecting the mindset of collectors, managers and owners in a negative way. Consumer lawyers (maybe we should call them debtor lawyers) are why we changed our tune but I think we should have kept the word debtor, its not a bad word.

Somehow the word debtor became a bad word and I am not sure why?

Wikipedia defines a debtor as “If X borrowed money from his/her bank, X is the debtor and the bank is the creditor. If X puts money in the bank, X is the creditor and the bank is the debtor.” and defines a consumer as “The consumer is the one who pays to consume goods and services produced.”

If this is the definition to both words they are debtors not consumers, consumers “pay to consume”,

So why did a whole industry change its vocabulary?  

The truth is we did it from pressure we created on ourselves as an industry. We thought its would make us look more consumer friendly in the eyes of regulators, clients and potential clients. But was this a good thing? I think it has gotten too many collectors and even managers in a mid set that the debtor is right and the collection strategy is the bad factor.

The truth is that debt collection has been getting more and more consumer friendly since I began collecting in 1979. But it has gotten to a high point in 2016 in my opinion. Debt collection has changed to accommodate the consumers’ habits by moving to self-cure websites and IVR systems.

The birth of self-cure 

The birth of debtors curing their debt online with no human interaction is a positive result of the consumer mentality of debt collection. It has allowed agencies and law firms to reduce its compliance exposure and collection expenses by letting the debtor pay online. Most debtors do not really desire to talk to a debt collector when it comes time to pay they just want to make the transaction online. So the use of a payment site is the obvious answer and a best thing to come from the consumer friendly era created by consumer attorneys.

Now what? 

I think as an industry we need to remember that that are both debtors and consumers. Actually our job as an industry is to turn them from debtors into consumers. We have to treat them like consumers but remember that they are debtors till they pay the debt and they need to be handled like debtors.

The fact that our industry has made the effort to allow the debtors to self-cure by creating elaborate payment sites shows our ability to adapt to the consumer model but we still have to remember that most debtors need help to pay their obligations. They need financial counseling, just the push a call makes or they need a payment arrangement that the website cannot approve for them.

Lets remember they are debtors and need our help to pay their bills and become consumers.

Re; My collection staff sucks!

Since 2007 I have seen the decline of the skill set of debt collectors in the US and it is at an all time low today. As a consultant to the ARM industry I see this daily and I have several ways to deal with the problem.

When the economy was really pumping in 2005-2007 or so the debt collection industry was at a high point and debt collection was easy. Debtors, now called consumers had the availability to get loans so money was flowing in debt collection, it was just financial counseling. After 2007 and the economy fell the ability of the debtor to get a loan was gone and so was the ability to collect money from debtors.

Along with that change in economy came a stoppage of training and development in the ARM industry which has continued until recently. Back when the money was easy to collect, training was not a big deal, just get someone on the phone and you had collection results. Now collections is much harder due to not only changes in the financial landscape in the US but in compliance costs as well.

With the birth of the “consumer” and the death of the “debtor” we have also changed the way we do business. As the ARM industry started using the term consumer over debtor a change in mentality also was created. The truth is “They are consumers.” So as that mentality changed so did the mentality of the average collection agent. But we did not provide new tools to collect from the new consumers. Training and development was and is still a last resort not a daily task. Managers would rather fire and hire than train and develop. Why? Because they don’t know how to train, that skill set is gone in todays C level managers.

So how do you solve this problem? You already know the answer its training and development but how do you do that is the real question. Most managers do not have a good training program. Most agencies I see just sit the new staff member next to their best collector to be trained. This is wrong in so many ways.

I have developed an extensive training  program that I can facilitate or help my client facilitate that starts with what is a debt? and ends with negotiation skills. It is very extensive on everything from credit reporting to an explanation of each bankruptcy type. This is how I solve the problem.

My second recommendation is to move some staff to Jamaica. The results of collectors in Jamaica is 90-110% of those in the US. The staff is much more eager to come to work and be taught and work for 1/3 the wages. I have helped several agencies set up in Montego Bay and in every instance the staff there is out performing the US collectors.

Either way you go you have to embrace the fact your staff must be trained and then they must be slowly developed into better staff. Its a big commitment and if you need a road map or some help just give me a call.