Guest commentary: Why smartsourcing makes sense in a soft automotive economy

The fluctuating economy has yet to bring a full recovery to the automotive lending space, either in the U.S. or Canada. Interest rates remain high, and borrowers who are committed to loans find themselves with less cash than ever because of the inflationary costs of essentials from groceries to gasoline to home heating.

Companies are tightening their belts, which often means cutting staff through layoffs or attrition. Even when such measures are done with the greatest of care, it often results in the remaining employees having to shoulder some of the workload. Organizations in the automotive sector — and their individual team members — are being forced to do more with less.

Yet there are strategies available that enable lenders and dealers to manage their workloads in a cost-effective manner.

Smartsourcing — or intelligent outsourcing— is one of these ways. It presents an emerging concept in outsourcing where highly skilled agents with broad knowledge of the tasks, regulations and compliance issues in the automotive industry are combined with advanced, artificial intelligence-powered technology to serve as an extension of an existing team.

Traditional outsourcing has always been a method that firms have turned to for conserving costs on staffing, typically by off-shoring the most basic customer service-related tasks. However, this conventional model has garnered a less than stellar reputation because of a lack of skilled agents, high turnover of personnel and other potential communications barriers that make it challenging to reach satisfactory resolutions.

Smartsourcing companies, in contrast, provide a team of highly trained, career-minded agents who have deep expertise in complicated areas such as financial services, lending and collections (a department whose workload rises during difficult financial climates). Smart outsourcing creates a staffing solution that can seamlessly integrate into an existing company culture as part of an established team. An effective smartsourcing company will also leverage automotive lending technology so agents can expediently perform their tasks. AI-based tools empower these firms to conduct AI-powered quality assurance and produce detailed analytic reports to ensure that the smartsourced team meets or exceeds expectations.

Smartsourcing teams are trained to execute projects in areas ranging from automotive sales and customer service, to collections, fulfillment, loan management, customer outreach and events management. This allows organizations to take advantage of the cost-effective nature of outsourcing while maintaining a consistent and superior level of service.

The ability to economically augment staff while maintaining outstanding performance is essential for organizations that are looking to deliver positive experiences in an uncertain economy — especially in an environment that has been rather unforgiving for automotive lenders and dealers alike.

For example, a major North American automotive auction company has been leveraging a smartsourcing team to support lending activities for their ongoing auction events for the past five years, allowing them to cost-effectively increase business and run additional events without investing in more staff. Their smartsourcing partner transparently conducts outreach to potential customers, helps to facilitate and fulfill loans, manages auction attendee communications, and oversees asset management.

Similarly, one of Canada's largest credit unions leveraged a smartsourcing team to take on a book of business worth more than $200 million, which the company needed to outsource in order to transition to meet federal guidelines. The credit union was able to offload that business to a smartsourcing team with deep knowledge of their industry, delivering superior service to those borrowers for the life of their contracts. Yet the credit union was still able to benefit from the revenues from the accounts.

In both of these examples, the smartsourcing provider utilized AI-based productivity tools that allowed agents to effectively perform their tasks. The company also provided comprehensive analytics quality assurance to ensure that all outreach maintained the highest level of compliance.

These are only a couple of examples of how smartsourcing can accomplish organizational objectives, augmenting existing teams even in less than ideal economic conditions. Outsourcing has evolved into a strategic asset that delivers powerful results, accurately and cost-effectively.