Software Tracks Payments For U.K. Auto Finance Company

Toyota Financial Services U.K. is the dedicated finance arm for Toyota and Lexus in the U.K., providing an extensive range of vehicle financing products to customers and dealers throughout the country.

The company also claims to have the lowest arrears book in the local captive motor finance market, thanks to technology. TFS says its new contract management system, developed in partnership with the British arm of French-headquartered IT services company Sopra Group helped it manage arrears in a simple and effective way.

A key tenet of Toyota's global culture is continuous improvement -- in Japanese, kaizen -- a quality exemplified in the car maker's famous Toyota Production System. According to Toyota Financial Services U.K.'s customer services manager Catherine Harrington, any business technology the company chose had to reflect the theme of continuous improvement. Sopra Group's Installment Credit Suite (ICS) application fit the bill through its flexible and configurable functionality.

The workflow functionality enables the company to manage staff time, workload and business processes very effectively. "You can configure the workflow to map user roles to tasks, with full management reporting at each stage of the process so you are very much in control of how work is managed," Harrington explained.

[ Redcats Group trades its outdated mainframe for Sopra Group platform. Read more at U.K. Company Swears off Mainframe, Carefully. ]

She continued, "The system helps us manage arrears and credits so well that we can keep our overheads low. Furthermore, whilst the nature of our customer base and our credit scoring criteria influence the default level, it is thanks to the flexibility and efficiency of our Customer Management solution that we're able to intervene and manage events effectively at a very early stage when customers do go into arrears. As result, we have the lowest arrears in our industry."

When Toyota Financial Services U.K. decided to insource its back-office operations in 2001, management was tasked with finding an IT solution to handle contract administration and arrears management. The advantage of starting from scratch, according to Harrington, was that the team could source a solution that met its specific needs rather than inherit a legacy system that would need some development.

ICS fit that requirement perfectly. "When we saw ICS for the first time, one of the biggest things that drew us to the application was that it was Windows-based, flexible and easy for the user to configure compared with other applications available," Harrington said. Toyota Financial Services U.K. used IBM's AS400 mid-range platform at the time.

"We are a very customer-focused organization and therefore need systems that can be adapted quickly and easily in response to new legislation or changing customer needs. With ICS, we can simply go into the system template and reconfigure the workflow; the system will adapt to whatever we want it to do -- and more importantly, we can undertake more than 80% of system enhancements in-house." Harrington said this aspect of the business application saves time and money and eliminates the need to brief suppliers with code changes.

A decade after implementation, ICS continues to underpin the company's core business processes, managing a range of important business functions, from dealer payouts and vehicle refinancing to core functions like customer account management, customer communications, end-of-agreement options and arrears management.

"The system gives our Finance, Customer Care, Collections and Complaints teams the flexibility to configure the application to meet their individual needs," Harrington said. She particularly likes the package's user interface: internal teams can adapt screens to show all the information they need in one place, and because it's color-coded, they can see at a glance where action is needed.

"The system is also extremely efficient since we have configured it to 'manage by exception,'" she added. That means it can immediately flag any event that needs human intervention -- for example, if customer has overpaid or is in arrears, or if the company receives notification a customer is deceased. "This means we can take action immediately to manage and resolve the situation quickly and efficiently."

Harrington said a key factor in ICS's ongoing contribution to TFS is the good relationship between the two companies. "The relationship has been very stable and is always forward-thinking in areas of support. By working together, we have developed the system to meet our business needs -- and this approach has contributed greatly to our success and helped us to grow the business. In particular, we appreciate the way Sopra Group keeps its eye on the ball in terms of any legislative change that may require systems development. The system is able to be adapted quickly to react to legislative and compliance changes and to keep pace with business changes too."

Rick Falkvinge, the founder of the Swedish Pirate Party and a campaigner for sensible information policy, will present the keynote address at Black Hat Europe 2013. Black Hat Europe will take place March 12-15 at The Grand Hotel Krasnapolsky in Amsterdam.