Thrown Under a Bus — and Learned from the Experience – Michael Dennis, CBF

Watch Out!

Years ago, my manager and I attended the national sales meeting. On the second day, the VP of Sales made a surprise announcement. “All of you know that our Credit Manager is here. I am going invite him up to explain why our credit policies are so restrictive that we lost business last year to our competitors. As you know, some of you did not reach your sales targets, and I am sure you have lots of questions for him”

The next 45 minutes were stressful, but this experience taught me a great deal about how to interact with the sales group. I learned in 45 minutes the importance of taking time to explain the rationale behind negative credit decisions. I learned that it was best to give advanced notice about possible negative decisions. I learned to encourage salespeople as well as sales management to challenge any credit decision they consider incorrect.

My advice is to think carefully about your present relationship with the sales department and to remember that there is room for improvement in any relationship. I found that more open and more detailed discussions helped change the perception of the credit risk management function for most sales personnel. My challenge to you today is to look for ways to build bridges and mend fences between sales and your department. If not, one day you may be invited to a sales meeting just like me.

Tips on building bridges include:

  • 1. Return calls the same day. Chances are good that sales is calling you because the customer is calling them.
  • 2. Whenever possible, give advanced notice of credit holds. Rather than announcing an account is past due and on hold, try this instead: Let the customer and the sales department know that if payment is not received by a specific date that you will have no choice but to consider a credit hold.
  • 3. Always be open to new information or suggestions made by the sales department. Valuable information and valid options can come from anywhere including sales.
  • 4. Take as much time as necessary to explain your decisions to the salesperson, but remember that this is not a debate or a negotiation. It is an opportunity to share information.
Michael Dennis, CBF

What are your thoughts on this subject? All comments and constructive criticism are welcomed.

Michael Dennis’ Covering Credit Commentary. Michael’s website is  www.coveringcredit.com

The opinions presented are those of the author.  The opinions and recommendations do not necessarily reflect the views of CMA, or their Officers and Directors.  Readers are encouraged to evaluate any suggestions or recommendations made, and accept and adopt only those concepts that make sense to them.