How Thames Water Cut Bad Debt by 11% in a Year
Blog: Enterprise Decision Management Blog
Think of collections and most people think of angry phone calls and repossessed cars and homes. But what happens when you provide an essential service you can’t switch off?
That’s the case for Thames Water, the UK’s largest provider of water and wastewater services, which uses technology to increase results. Thames Water has reduced bad debt by 11% in the last 12 months by innovating its collections process using FICO® Debt Manager™ solution. For its achievement, Thames Water has been awarded the FICO Decisions Award for Debt Management.
“The introduction of Debt Manager 9 has allowed us to design our treatment strategies from the bottom-up — rather than building strategies to the system limitations, we built them to the business and customer needs,” said Ross Betts, Thames Water’s collections system, strategy & segmentation manager. “This program has been hugely successful, not least because it managed to implement several ambitious goals at once. The implementation of FICO Debt Manager has allowed for the creation of new strategies, processes, partnerships and ways of working, which all rely on accurate data.”
Thames Water’s supply area has a highly transient population with a large number of rental properties, which makes collecting and collating accurate data difficult.
“Our first step towards improving the debt management process was understanding our customers better, making sure we have accurate customer data and segmentation to allow us to treat them appropriately,” said Betts. “The first data cleanse resulted in the update of over 500,000 customer names and the addition of 2.2 million customers’ dates of birth. It also identified a large number of active accounts where the customers were no longer resident, with over £28 million of associated debt.”
Thames Water also implemented FICO® Customer Communication Services, which sends reminder text messages and sophisticated interactive voice calls so customers can receive notifications of important account activity through the channel that suits them best.
“Thames Water is using customer-level collections, with a lot of data management, from different areas,” said Petr Kapoun, retail risk director at Česká Spořitelna, one of this year’s FICO Decisions Awards judges. “Customer-level collections is hard for many reasons — for example, if a customer is paying one account but not another, what is the strategy for the former account? Also, Thames Water is not in the position of being able to deny service based on late payments, which makes collections challenging.”
Congratulations to Thames Water!
The post How Thames Water Cut Bad Debt by 11% in a Year appeared first on FICO.
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