Avoiding Career Limiting Mistakes

For credit and collection professionals, it is important to avoid what can be called career limiting mistakes.  Members of the credit and collection team need to understand that their decisions are under constant scrutiny, and that unfortunately the accuracy and appropriateness of their decisions is often not readily evident, especially to internal customers including the sales department or to external customers including companies applying for credit or active accounts requesting a higher credit limit or extended dating or some other concession from the seller/creditor company.  There are several keys to success including making appropriate, timely, well-reasoned and well documented decisions. 

It is also important that credit professionals including but not limited to the credit department manager avoid potentially career limiting mistakes, including these:

1. Holding too many orders. Order holds should only used as a last resort.  Customers should be notified. Sales should be told of the decision first if possible.
2. Allowing too many orders to go into the order approval queue. When this happens, there is alway the possibility that the department will fall behind in shipping orders. Don't make the automatic order approval process too restrictive.
3. Failing to treat every customer with respect. Retaining customer goodwill is everyone in a company's job.
4. Failing to learn from your mistakes. The only thing worse than making an error is repeating it.
5. Allowing and accepting mediocrity from your department staff - or worse incompetence. If someone does not care or cannot do a good job, get rid of them as soon as you can.
6. Calling customers or sending dunning notices to customers about disputed balances.
7. Failing to take customer complaints seriously. Respond appropriately, and notify the customer about what you find, what you can do, and how soon it will be done. Take complaints from your sales department equally seriously.
8. Depersonalizing the credit function in order to avoid stressing interactions. Examples would include litigating rather than negotiating, and corresponding with customers rather than calling them.
9. Mishandling customer contacts. Examples include:

• Interrupting an irate customer

• Failing to listen attentively

• Failing to ask appropriate questions

• Accepting without protest a customer's first payment proposal

   10. Failing to recognize the fact that the credit department is required to interact with customers, salespeople, and co-workers professionally, openly, proactively and courteously.

   11. Allowing an Us-Against-Them attitude to develop in the credit department between credit and sales, credit and customers, or credit and other departments.

© 2011 by Michael C. Dennis.  All Rights Reserved.