Monitoring your new account acquisition decisions: Decision Management

August 6, 2009 by Guest Contributor

By: Kari Michel

This blog is a continuation of my previous discussion about monitoring your new account acquisition decisions with a focus on decision management.

Decision management reports provide the insight to make more targeted decisions that are sound and profitable. These reports are used to identify: which lending decisions are consistent with scorecard recommendations; the effectiveness of overrides; and/or whether cutoffs should be adjusted.

Decision management reports include:

• Accept versus decline score distributions
• Override rates
• Override reason report
• Override by loan officer
• Decision by loan officer

Successful lending organizations review this type of information regularly to make better lending policy decisions.  Proactive monitoring provides feedback on existing strategies and helps evaluate if you are making the most effective use of your score(s). It helps to identify areas of opportunity to improve portfolio profitability.

In my next blog, I will discuss the last set of monitoring reports, scorecard performance.