Debbie Nolan, commercial director, Arvato Financial Solutions
06/06/2018 at 10:27am
“Debt recovery is repetitive and process heavy, requiring the management of a significant amount of often disparate customer information”
Bad debt continues to be a big problem for utility businesses. Last year a major report from Ofwat and PwC highlighted the amount of revenue owed to water providers alone has topped £2.2 billion. But while addressing this must be a clear priority, the need to safeguard valuable customer relationships, as well as vulnerable consumers, remains a key priority.
That calls for a more efficient, customer-focused method of recovering debt. The good news is the latest developments in technology, such as robotic process automation (RPA) – powered by next generation artificial intelligence – will deliver specific innovations in revenue collection.
Debt recovery is repetitive and process heavy, requiring the management of a significant amount of often disparate customer information. When this is performed manually, it can be a laborious, resource consuming task that is prone to human error. This makes it ideally suited to the applications of RPA.
The technology uses computer software to mimic human interaction with IT systems, following rule-based processes that can be closely managed. This produces an agile, virtual workforce that can shoulder the burden placed on collection agents by handling mundane, repetitive tasks with greater speed and accuracy.
The headline benefit of this autonomous support, from a collection function’s perspective, is a boost in efficiency that reduces costs. But, it’s not just about productivity gains. RPA can also be used to free up employees to focus on complex cases of debt recovery that require a more human touch and to identify vulnerable customers who warrant a bespoke approach earlier in the collections process. It’s an advantage that fits the utility industry’s requirements perfectly.
The UK energy market is becoming increasingly competitive. Switching supplier is now easier than it’s ever been, making customer service a key differentiator for providers. And for water firms, the regulatory and financial pressure to hit customer satisfaction targets ahead of the industry’s price review in 2019 is mounting.
When you add to this climate the growing attention given to the treatment of vulnerable consumers by major utility providers from the media and government and the sector cannot afford to risk hostile customer engagement. Collections have to be approached sensitively, with the wellbeing of the debtor properly considered.
Automation can help here by giving collections agents access to an intuitive system that provides a live dashboard of customer information and recommended actions in real time.
Powered by cognitive technology, this kind of tool can collate data from multiple and sometimes disjointed systems and build it into the everyday interactions a utility’s debt management team has with customers. This offers agents a comprehensive view of customer’s habits, outstanding debt, previous contact history and details of any mitigating circumstances.
The software can then harness this information to develop bespoke strategies for agents to use while they’re interacting with a customer. This can minimise average handling time and reduce the number of potentially uncomfortable questions that need to be asked before a case is resolved. It can also take the responsibility of making a particularly difficult decision out of the agent’s hands, reducing the likelihood of human error and further increasing productivity.
The benefits automation can offer a collections department will accelerate as the technology is integrated with more advanced AI. At the moment, automated systems that support agents are rule based, and require a significant amount of human supervision. But soon, automated systems’ capability will be able to comprehend the nuances of human speech and recognise more complex patterns in processes.
This means the scope and scale of tasks undertaken within the debt recovery process that can be fully automated, in both the front and back office, will leap forward. Eventually, utilities will be able to standardise, digitise and design systems with the integration of automation in mind. For collections, this means even greater efficiency, more support for agents and, ultimately, a better, more bespoke experience for customers.
With these new opportunities will come new demands. Large scale automation and the advent of true AI is still some time off, but utilities should recognise the way the world is changing and start to look at important functions, like collections, to get ready. Pilot schemes that test the impact of automation on a specific process and honing recruitment strategies to look for digital skills is a sensible place to start.
It’s clear a key part of the solution to the revenue collection challenge facing utilities is the effective management of customer experience. By exploring automation now, collections departments can be well-positioned to leverage the customer relationship and productivity benefits the next generation of the technology is set to deliver.