Think Out of the Box

Remember paradigms? Some years ago, everyone was talking about being in a paradigm, a box of normalcy and if businesses were going to change for the better, they had to think outside of it. In recent weeks I’ve had two situations that reminded me of the paradoxical paradigm. The first, a salesman I know was preparing to visit a customer who owes $600,000. The objective of the visit is to figure out how to keep the company afloat so that in time it will be in a position to repay its debt. The salesman told me, “Two years ago we would’ve sued the bastard and gotten a judgment.” Back then the chances for recovery of a judgment were a lot higher. Now, not so much. The salesmen recognized that he and his company had to be creative in its approach to collecting money. He had learned the lesson of being stuck inside an outdated, ineffective paradigm.

The second situation has to do with the homeowners association I mentioned a few blogs back. They were threatening to assess the homeowners who were paying their dues on time to make up for the loss of revenue caused by the failure of other homeowners to pay their dues. When times are good, the association experiences about a 1% delinquency rate. Now it is running an alarming 10%. I volunteered to help the association collect from the delinquent homeowners. Well, it’s not that easy. The homeowners association has its rules – its very own rigid paradigm. The current practice when a homeowner is delinquent is to send him a letter. Another letter goes out after 60 days past due. Then a third letter is sent from the association’s lawyer threatening a lien. My approach was to make a phone call perhaps between the second letter and the lawyer’s. As a collector, I’ve discarded letters for the most part, finding a direct voice to voice approach to be much more effective. Ah, but the association as its rules, outline in the CC&Rs. There the procedure is set in stone, much like the Ten Commandments etched in granite. And as effective has my approach may be, it cannot be done. Amazingly, the association would rather have less revenue and risk the ire of the homeowners, than consider a change in its collection practices.

Companies who can change in tough times, survive the tough times. Those who don’t change don’t survive. Don’t get stuck in a paradigm dogma. Let Strategic Credit Management Solutions review the trends, offer some solutions, train the staff and set you on the right course. It’s what we do. See our website www.powerscredit. You can e-mail us at patrickpowers@sbcglobal.net. Your comments are welcome