Credit guru Thea Dudley has spent more than 30 years in LBM credit management. Now she's here to answer your credit and collection questions. Got a question for her mailbag? Contact Thea at firstname.lastname@example.org
Is it just me, or does the credit department really end up handling every problem in the company? I am the credit manager—not sales, not pricing, not customer service, not the return department, quality control, or a therapist. I grant credit and collect the money. How is it I end up with what feels like every other department’s issues?
signed, Can't Stand it in California
It feels like it because it’s true.
Imagine a huge funnel. Into that funnel goes sales, marketing, products, delivery trucks, customer service, and invoicing. They all swirl around until the funnel narrows and whatever unresolved bits of the experience plops out the bottom of that funnel onto what l like to refer to as "the diaper." You know, the place where all the poop lands.
You, my sun kissed friend, are the diaper. All the poop lands on you.
Don't take it personal. Credit is usually where problems become the most visible. If there is a problem, it shows up as an unpaid, or short-paid, or heavily deducted eyesore on your accounts receivable. These issues are bounced around from one person or department to the next as you try to get others to take responsibility for their little LBS (leaky bag of stuff).
Deductions, pricing issues, returns, damaged items, quantity issues, tax issues, hang nail—you name it, if there is any issue, it shows up on the accounts receivable. And it is staring at you every day, just waiting to be resolved.
You can look at your department as being the diaper of the company. Instead, though, try changing the metaphor.
Think of yourself as being the quarterback known for how well she performs in the last minutes of the game. This scenario gives you the opportunity to be a problem solver, learn about other areas of your company, and spend time with co-workers. Yes that is my Pollyanna, rose-colored-glasses spin on the situation. However, it is true.
That being said, it doesn't mean you have to stand there holding the aforementioned LBS. Problems don't go away or resolve themselves because you ignore them or complain that they are someone else's issue. Once you know there is an issue ,you have to have a plan of attack.
Strategy, my dear, is what you need to keep in mind. A plan. A methodology for dealing with these issues.
- Reach out to the appropriate person in your company, depending on the issue. If you can do it in person, great, chose that method first. I love email and it is easy, but I prefer to have the conversation about the problem where we can be face to face. It is a little harder to blow me off when you have to look me in the eye. If you can’t speak in person, go with a phone call over email. Again, harder to blow me off.
- Follow the conversation with an email capturing what was discussed and what actions were to be taken, with a timeline. If you are waiting on resolution, a credit issued, conversation with the customer or follow up, you need to know when to expect that to happen.
- If the deadline is missed, move up the food chain. I follow the email with an email inquiry as to where we are now, and I copy that person’s manager. Don't think of this as tattle-tailing. If the person had taken care of this in the first place, this wouldn't be happening.
- If that doesn't work, call and email again with a deadline and your intended plan of action if you don't hear from them by that time. I have a three times rule: three strikes you’re out, or third time is a charm. Either way, I am getting this resolved.
Usually, once I share how I am planning to resolve the issue (be it a credit issued taken out of their profit center, putting the customer on “no sales allowed,” or taking some other drastic step), I get a response with a resolution. Sometimes, it does take more then the sales rep to fix an issue for the customer. Get whoever in your company needs to be involved and keep the pressure on.
This is not about assigning tasks or blame, it is about the customer. Getting the issues resolved and giving them a positive experience even if the issue is difficult. The customer does not care, nor do they want to know, about your internal struggles. They up just want the problem fixed with as little effort, drama and phone calls as possible.
In other words, be the change you wish to see in your world. Yes, that’s corny. But hey, I'm a credit manager, not a poet.