There are several important factors to consider when starting a debt collection practice. The following article is intended to provide 3 easy steps to help you succeed at your collection practice. The concepts are not new ones, but if followed they will bring success in your collection endeavors. The following 3 steps are critical for a successful debt collection practice. I will discuss each of these in detail, but for simplicity sake we will refer to them as the 3 S’s of SUCCESS (System, Staff, Software).

1. SYSTEM – In order to be successful, it is essential to have a well thought out system in place. Parts of your system should include areas such as identifying specific needs for staff, cross-training staff, delegating staff responsibilities, ways to track and increase efficiency of collection cases, determining what to do when growth comes, and making a plan for the organization of collection cases. The system that you choose or design is critical to your success and should be specific to your needs. If you are a new collection business or collection lawyer starting out you may only have a secretary to work with, if you are a larger firm you may have 6-8 people that handle your collections. Regardless of your situation, an organized system will improve your success. If you have more than 1 person handling your collection cases, most collection practices will tell you that it is most effective to have your staff specialize in specific areas of the debt collection life cycle specifically when it comes to tracking the legal life cycle of each case. Rather than having a debt collection staff that does it all, have staff members that specialize in areas of the collection life cycle. By adding this paradigm to your current system or the system you are designing, you can greatly improve the number of collection cases you can handle and ultimately improve your bottom line.

2. STAFF – It is critical that you have staff that is motivated to work and work hard. One way to motivate your staff is to provide bonus programs or incentives. Statistics show that money and bonuses motivate employees to perform better. It also builds employee loyalty and gives them something to strive for. It is important to make sure that you have a way to track the efficiency of staff based on individual and collective performance. By building bonus programs or incentives into your SYSTEM, and monitoring the efficiency of your staff and collection business, you can greatly increase the efficiency of your collection practice. Finding staff that share the same work ethics and get along is also helpful. It goes without saying that you can get more work done if your staff works together as a cohesive team.

3. SOFTWARE – Once you have your system defined and you have hired a successful staff team it is time to focus on software. Because of the complexity of the debt collection process, it is critical to have software that is as specialized as your debt collection practice. There are several off-the-shelf debt collection software packages. Some of these software packages offer to “do it all for you”. It is best to steer clear of these types of packages. Generally they are very expensive and provide so much functionality that they don’t provide specific functionality really well. The 3 areas that you should focus on for your software needs are as follows:

By focusing on specific software that meets the needs of these 3 areas rather than a single software package that “does it all”, ultimately you will spend less money on software and services and your collection business will become more organized and effective.

The biggest problem inherent with collection case management is that most collection agencies or collection attorneys do not have a good handle on the number of collection cases that they are managing and do not have effective software that allows them to track the collection cases through the litigation lifecycle. Our recommendation for software to improve efficiency in this area is a software product called Simplicity. This software is the only specialized software that we have found that focuses only on the legal aspect of collection cases. Developed by a successful collection lawyer, Simplicity keeps track of every aspect of the litigation process associated with debt collection cases. We have seen agencies and collection lawyers achieve phenomenal success in terms of collection case file organization, an increase in number of debt collection cases they are able to handle, and ultimately an increase to their bottom line.

In summary, by following the 3 S’s of success and focusing on a good SYSTEM, effective STAFF, and specialized SOFTWARE, you will see your collection business expand, grow, and achieve the success you dreamed of.

Christian Smith
Debt Collection Consultant

January 2010 - Simplicity Software recognized for its comprehensive legal tracking capablities. Each step of the legal process is uniquely defined, precisely tracked, and consolidated on a single screen for easy access and viewing. Cases once lost in the legal process are now efficiently tracked so no case ever falls through the cracks.

March 2010 - Simplicity Software releases new product capabilities for judgment recovery professionals and collection agencies. Capablities include:

• Work-Flow Automation - The system keeps staff and management aware of where each client is in the litigation process. No more having to remember to manually enter next-steps into a tickler system!! (However an automated tickler system is still integrated into system.)
• Work-Flow Reports - All the reports staff and management could want along with the ability to create custom reports. Since the system “knows” where every case should be … key reports can flag hot areas such as pending deadlines BEFORE it’s too late!
• Efficiency Score - Know exactly how many of your cases are bringing money in and how many aren’t! Your entire team can push to increase the Efficiency Score and you know just where your business stands and which direction it’s headed!!
• Legal tracking – Tired of trying to track your cases through every hoop of the legal life-cycle? Simplicity allows you to track each case through the legal process without having cases fall through the cracks. Did you ever wonder which judges were cutting your fees, which writs you have that need to be sent to the court, what abstracts and judgments need to be sent to the court and county to file? Simplicity’s case details screen allows you to track all this and more.
• Financial, payment, and interest calculations - Are you using Excel to try and run your complex interest, allocation, and contingency fee calculations? Simplicity allows you to easily enter payments, track costs, quickly see client/attorney/agency financial allocations, track pre and post judgment interest, and so much more.
• DocGen Tool – Tired of generating all of your documents by hand. Simplicity’s new DocGen tool allows you to create your own keyword rich templates, for an unlimited number of documents. Simply create the template in Microsoft Word, upload the template to our servers, and then generate documents for debtors as needed. It’s as simple as that.
• Enhanced debtor, employer, and co-debtor information – Now you can keep track of a debtor’s information, add co-debtors to a case, manage debtor notes, and track employer information for use in garnishment documentation.
• Financial reporting – Need financial reports to give to your clients. Simplicity contains both transaction and payment reports that can be run for any given timeframe. These reports show the transaction and/or payment history for each debtor belonging to that client and breaks out each payment based on the allocation method, and client commission rate.
• Case management – Completely manage every aspect of your cases including every step in the legal life-cycle, complete financial, payment and cost tracking for each case, and comprehensive debtor and co-debtor sections.
• Complete flexibility – Simplicity gives you the ability to add your own counties, clients, process servers, employees, and so much more
• Paperless Doc Library Storage - Is your collection or judgment recovery firm trying to go paperless? Simplicity allows you to upload and store important documents related to each case. With a few easy keystrokes, you can upload debtor documents, download documents you have previously uploaded, and manage all your case files in a paperless manner. Better yet, you can have access to any of these documents anywhere you have an internet connection. With an efficient and easy to use interface, you can manage and view all your files online and forget about the mess of managing physical files and filing cabinets.
• Unlimited users – Simplicity allows you to have an unlimited number of users in the system simultaneously. Data is stored securely and updated in real-time for others to view.

Simplicity Software Debt Collection Affiliate Agreement
The National Judgment Network
The National List of Attorneys
www.CreditorsRightsLawFirms.com
Debt Connection - Your online resource for collection and judgment recovery professionals
Debt Connection - Your online resource for collection and judgment recovery professionals
NARCA - National Association of Retail Collection Attorneys
CLLA - Commercial Law League of America
NACM - National Association of Credit Management
Legal and court forms for judgment and collection professionals
Research the origination of a SSN