Debt Collection is not for Everyone: Understanding Turnover

I admit it; I would be a terrible debt collector. If I had to sit in a chair all day long and track down and talk to people who I assume hate me, I would just go nuts. Yet, in spite of my distaste for the job of a collector, many people do it well and stay on the job for long periods of time. Different strokes for different folks! Right?

I have worked as a behavioral scientist and human resource consultant to many collection centers. I always ask managers I meet with to tell me about the biggest personnel issue they face. Excessively high employee turnover is almost always on the list of problems. I ask: why?  The answer is always the same: low pay, poor working conditions, and most commonly, the nature of the collectors’ job itself.

When I hear this response, I follow up with the next question. “Regardless of how bad things are at your center, do you have any collectors who have stayed with you for over two years or are doing a good job?” The response is invariably, “Yes, we do have some of those collectors.” Now, the big question, “What characteristics differentiate the collectors who stay and do a good job from those who cut and run? Perhaps,” I suggest, “if we can understand those differences, a positive step can be taken towards solving the problem.”

This dilemma reminds me of a monumental study by Patricia Cain Smith conducted in the 1950s. Dr. Smith, one of the all-time great behavioral psychologists, studied occupations that most people thought were bad jobs and tried to understand why some people stayed and performed while others didn’t. The findings of her study have profoundly influenced my career and subsequent ideas in this regard. Basically, Dr. Smith concluded that there is no such thing as a bad job. Rather, there are some people who don’t adjust well to certain types of jobs, for example, bill collecting. But a job which is distasteful to one person is “duck soup” to another. Essentially, Dr. Smith’s work dispels the excuse of call center managers who blame high collector turnover on the job itself.

Now, with consideration to the research of Dr. Smith, if you want to attack the problem of high employee turnover, you only have two choices. You can try to change your organization: pay, working conditions, supervisors, etc. or you can try to change the people you hire.

The first approach assumes there is something wrong with you and therefore you must do something to make yourself a better employer. The second approach implies that perhaps there is nothing wrong with your organization (remember, many people stay with you and perform well) and that perhaps you are hiring the wrong people. I suggest to you that it is easier to change who you hire than it is to try to change your organization. Birth is always easier than resurrection.

How do you go about hiring people who are suitable to a collector’s job? Research has proven the best way is to try to understand the basic characteristics of the people who are staying with you and then do a side-by-side statistical comparison of those same characteristics of the collectors who are prematurely leaving you.

Let me give you an example. I am a college professor, age 66, who plays golf on even-numbered days and fishes on the odd-numbered days. I think it would be glaringly obvious that a job applicant with those characteristics would not be a good debt collector. But there are biographical characteristics of people who are staying with you and doing a good job as a collector.

What about their educational level, their employment status, their hobbies, their distance from work? There are many other measurable characteristics that could differentiate the good from the bad agents. Once you can understand the pertinent characteristics, then you can apply them to future job applicants and hire more people like the good employees you already have.

About Dr. Brooks Mitchell
Dr. Brooks Mitchell is a Professor of Management at the University of Wyoming and the founder of two highly successful Wyoming-based software companies. When he founded his first company, Aspen Tree Software, he originated the Computerized Employment Interview and was a pioneer in the Internet job application process. In 1999, he started Snowfly. He now devotes his full-time efforts to Snowfly, his students and his classes at the University of Wyoming. Dr. Mitchell is the author of several books and articles concerning employee selection and motivation. His latest book is titled “Games, Work and Human Motivation.”  He has been featured in over 75 national publications including Forbes, Wall Street Journal, Fortune, The New York Times and U.S.A. Today.  He is a frequent quest on talk shows including recent appearances on CNBC and the Executive Forum.  Brooks spends his free time enjoying life, whether it is on the golf course or the trout stream.

About Snowfly
Snowfly is the leading provider of Internet based employee incentive and loyalty programs.  Snowfly’s incentive system allows contact centers to harness the enormous motivational power of immediate positive reinforcement to focus employee behavior on company objectives.  Compared with home-grown programs, Snowfly improves KPI’s by at least 20% (sales, availability/adherence, attendance, call quality), reduces a huge administrative burden and reduces costs.  The results are easily seen within weeks and there is no long term obligation.  Snowfly customers include multiple Blue Cross/Blue Shield providers, Hyatt Hotels, Time Warner Cable, Avis/Budget, financial institutions, utility companies, cable/satellite providers, various BPO companies (business process outsourcers), and collection departments/agencies.  

Snowfly’s web site: www.Snowfly.com.