How to use data hosting to better manage outside collections.(selected topic)

Publication: Business Credit

Publication Date: 01-OCT-04

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COPYRIGHT 2004 National Association of Credit Management

As a credit manager, how much time do you spend managing your outside collection efforts? Do you frequently find yourself prompting collection agencies or attorneys for information on claims you have placed with them? Too often managing these delinquent accounts takes more time and energy than they seem to be worth.

One approach--data hosting--may be a way for you to make the most of your time while allowing you to have up-to-date information on the claims you have placed with third-party collectors.

What is data hosting? In its simplest form it is storage and access to information (claims, for example) in your organization. When you think about it, you currently are a data host. Your data is stored either in your paper files or your accounts receivable management computer system. When you or someone in the credit or finance department needs information about a case, someone in your office retrieves that information from the paper file or looks it up on your computer.

Similarly, when you place a delinquent account for collection with a collection agency or directly with an attorney, you can bet that the information about the claim ends up in the collection management database of the third-party collector, regardless of how the data was sent--mail, fax or electronically.

Once it has been placed with a third-party collector, you will start spending time managing these delinquent accounts. The third-party collector may be asked for more information about the cases you have sent for collection. Regularly and periodically you will want to know what is happening on your cases. You will want to tickle your own file for key dates relating to the claims. And, you will want to be able to evaluate how successful your third-party collectors are at recovering money on your behalf.

One way to gain availability to your files at the third-party collector is to be given direct access to their computer...

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