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How predictive analytics is changing our business

Baycorp is taking its collection strategy from an art to a science through predictive analytics.

Data scientists are changing the way we do business in one of the oldest industries around with predictive analytics, which extracts insights from existing data sets to reveal patterns and predict future outcomes and trends.

Traditionally, collections have been an art, and over the years, we have been very good at this, says Baycorp manager, collection strategy and analytics, Bernard Ali. 

“With 60 years in resolving debt, our experience gives us the right to have that gut feel or intuition and more often than not, we make the right call.

“However, this has limitations, as we can only think about a handful of variables at one time. For this reason, our collection strategy has moved from an art to a science.”

Baycorp has the largest customer default database in the collection industry in Australasia, holding millions of historical phone records, addresses and specific knowledge about individual customer behaviour. Add to this Baycorp’s strategic move to align with Encore in 2015, and you have industry-leading predictive analytics and decision science expertise added to the mix.

The traditional approach to predictive analytics will allow staff to evaluate the chances of success before an action is undertaken, for example, a phone call. Analytics will help staff determine if a phone call is the most appropriate action for that customer – they may prefer to respond to SMS, or if it is a phone call, perhaps it’s best to call at a certain time of the day.

“However, to gain an insight into what predictive analytics can do for us in the future, we have to think about the possibilities, says Mr Ali.

“We make and take millions of calls in a year. Imagine if we could analyse a thousand calls in a few minutes, pick out key words our customers are saying and decide on the treatment based on the words the customer used on that call. This in itself, is powerful.

“Now imagine that we use the same tool to listen to our own staff. We figure out the words and phrases that work best to get agreements and more importantly to get payment. We then incorporate those words into our call guides and scripts to essentially create a call script that has the greatest mathematical chance of gaining an agreement and then the optimal words used to get the payment.

“Analytics is changing customer expectations and corporate strategy. The smarter Baycorp is with this data, the more successfully it can collect money on behalf of its clients.”