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 theadudley@charter.net
Dear Thea,
I recently heard you speak about building a power credit department. I went back and shared it with my company’s senior team, and although they listened, nothing further has come of it. How can I get them to support me in moving forward with changes?
Cold-Shouldered in Colorado
Dear Cold,
Have you ever heard the phrase, “If wishes were horses, beggars would ride?” What have you done other than have a conversation? If you are waiting for others to saddle up that pony for you, you will be waiting a very long time.
Change is hard and a lot of work. If you really want to move forward with making changes to the credit department and get people on board with those changes, you have to lay all the ground work. One conversation may get them to listen – for that moment – but how you follow up is how you make it happen.
Ready to get started? Here are the steps to follow:
- Assess Your Current Talent Levels in the Department: What skill sets do you have to work with?
- Assess Your Current Situation: Where are you now? How is the department viewed? What support do you have from senior management?
- Assess Your Methods: What processes do you have in place and are they working?
- Map Out All of the Above: Break it all down so you have an exact look at what you are dealing with and can EASILY explain it to others.
- Determine Your Goals: Where do you want to end up? What do you want to the department to look like? What are the expectations for it? Protecting the money and not losing any are both nice, in theory, but neither really inspires the team to excel.
- Talk it Out: Once you know where you would like to take the department, have a heart-to-heart with your president and CFO. What is their view of the department? What are their expectations? You may find they haven’t really given it a whole lot of thought. Truthfully, as long as you are not leaking bad debt, they may not even think about it.
- Spoon Feed Them. Yes, that does sound condescending, but they may not know what to expect from your department. Additional customer service, a sales partner, a profit center, an education center? All possible depending on what the support level, buy in, and directive or goals the company has.
- Map out the revised vision and get started.
I made it sound easy, but I assure you it will be like dragging a mule by the halter. There will be pushing, pulling, and swearing. But once you get the journey started, you will see progress taking shape.
Any department has to be in constant motion to remain relevant and to push the boundaries of what is traditional or expected. It sometimes takes years to grow a department that has a direction you’re happy with. Not everyone gets on board and some team members absolutely won’t like that direction or style. That’s OK if they don’t, but they have to understand that once the train pulls out of the station, everyone is either on it or you are leaving them on the platform. You are moving forward.
Understand that you will be the head cheerleader, coach, advocate, architect, and chief bottle washer. You will have to explain over and over what the objectives are, why you are doing this, how it impacts the company and the customers, and what the benefits are of a service-oriented credit department. The department is not all process and execution. It also encompasses creativity and interpersonal skills and thinking. Credit departments are typically not known as customer service and sales advocates, although most do that daily. Promote what you do to turn it into an asset, not some back office necessity.
The change won’t happen overnight, but it won’t happen at all if you don’t fight to make it happen. Stop wishing and start implementing.
