Finally, TELUS also started to provide collections representatives who deal with inbound calls immediate access to a customer's credit score as well as guidelines on the sort of payment arrangements the collections staff could offer depending on that score. Previously, representatives had to look across several screens to determine the standing of a customer requesting a payment arrangement. "They're trying to decide, is this customer worth working with or are we going to get burned in the end?" says New. "This gives them an instant tool to make that decision much more accurately."

Centralizing collections in one location made it easier to ensure consistency and implement new practices, New says. And he says a tool that tracks payment arrangements had a big effect on the level of bad debt. The tool, which was built in-house, gave management its first good look at the arrangements each representative was making with customers, allowing TELUS to spot those who were being too generous. "That was a key breakthrough," New says. "Up until that point, what the representative did with our customers in terms of the outcome was kind of unknown to us."

The hardest part was closing three offices and displacing more than 100 employees, New says. But TELUS tried to put other call center operations in the locations where it was closing collections centers.

TELUS accomplished its overhaul in just a year. New points out that the project wasn't costly, which was fortunate since TELUS didn't have a lot to spend. "We had to find ways to do this with what we had. When you look at the actual steps we took, there's many small, yet effective process changes and in some cases very small systems adjustments or changes."

CREDIT RISK MANAGEMENT – Silver

Microsoft Corp.

The downside to outsourcing collections work can be limited visibility of the receivables being collected, depending on the reporting provided by the outsource company. When you're Microsoft Corp.–and a single account can have more than 50,000 documents outstanding–that lack of information can quickly become a sizable credit risk.

Microsoft's World Wide Credit and Collections group wasn't able to make its pricey legacy collections tool accessible to outsourcers, but as the volume of transactions being outsourced continued to grow, the group knew it needed something. That something turned out to be MS Collect, a Web-based solution that can handle large numbers of documents and automates a lot of routine collections work.

Designing MS Collect, which deploys Microsoft's client services technology, took two years of work by internal IT and, in the later stages of the project, workers at Wipro in India. The system was created with outsource companies in mind, but has turned out to be a boon for Microsoft departments, many of which would have liked access but found the legacy system's license fees out of their range. MS Collect also automates administrative tasks involved in collections, allowing collections staff to spend more time talking to customers, says Jenny Kinaman, a senior product manager in the credit group. "Just by default, that should bring in some past due receivables a little quicker," Kinaman suggests. But in her view, the most powerful part of the new system is the reports that it can generate, which should give credit managers the ability to spot problems anywhere in the world.

CREDIT RISK MANAGEMENT – Bronze

XTRA Lease Inc.

XTRA Lease Inc., which provides freight trailers for rent or lease, has a keen interest in accurate credit assessments given the frequency of bankruptcies in the trucking industry. But it didn't want to inconvenience customers by making them wait while it went through a credit approval process. For XTRA, the answer was eCredit's nFusion credit and collections software–a Web-based credit system that cut the time required to process a credit approval to an average of 4 minutes, down from 16 minutes with its previous system.

The new system is also saving the company a bundle on credit data. While its previous system limited it to using one vendor's credit data, XTRA can now access information from four different sources. The one that it now queries first is a cooperative credit exchange that collects data from other leasing and fuel supply companies. John Pomilio, vice president of customer financing services at XTRA, notes that the new shared data costs just 10% of what XTRA had been paying for credit data.

NFusion also does the annual reviews of the credit facilities for each of XTRA's more than 15,000 accounts automatically, referring only the exceptions into analysts' work queues. Credit managers, who travel a lot, can access the system no matter where they are–as can any of XTRA's branch offices. And the new system will soon start keeping tabs on the total number of trailers that big national accounts have out from all of the branches, something that XTRA wasn't able to track before. "Aside from the risk piece here, there are huge branch efficiencies," Pomilio says. "Hundreds and hundreds of phone calls go away."