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Customer service and the credit department.

As business becomes increasingly competitive, many companies are putting a higher priority on customer service and retention. For a growing number of credit managers, this trend means wearing a "customer service" hat and assuming more responsibility to ensure the customer remains satisfied.

The benefits of this approach can be far-reaching. For some companies, the credit department is now viewed as a profit center by other departments within the company, as credit managers succeed in solving customer's problems without passing the buck. Still other companies have found improvements within the company, as different departments learn to communicate more effectively as a result of credit managers taking a more active role in service.

David Tilford, CCE, corporate credit manager, Lawson Mardon Flexible, Inc. describes his department as taking a more hands-on approach to customer service.

"We get right in the trenches with the customer. To come up with whatever the problems may be that may lead to deductions or terms disputes, material problems. We get involved sometimes in dispute settlement. If something is not right, what happens is the customer doesn't pay. So, instead of trying to rely on sales/marketing, which you ultimately have to involve, we jump right in and get the customer to find out what the problem is and come up with an outline of the whole situation and present this to the people who have to make the decisions on pricing and quality."

According to Tilford, the key to successfully implementing this type of arrangement lies in taking the initiative to solve the problem within the department.

"We do these things on an as-needed basis. When we discover problems, we go into action. We don't just forward the problem to someone else. We try to uncover all aspects of the problem or needs the customer may have. Simply stated, the credit department here is more of a team with the rest of the company, rather than some little office that sits off to the side and is considered non-productive. That's our way of becoming a profit center - keeping customers happy and having customers rely not on just sales and marketing but also on credit people to help with their problems.

"We have people call us rather than them because they feel like they'll get better service. As far as the day-to-day operation, I guess we're more reactive to those problems than pro-active. That sounds like a negative, but it's really a positive."

Moving to a more customer-service-oriented approach to credit often results in getting credit managers more involved in the mainstream of the business.

"You're more a part of the business when you're involved with these types of things," Tilford said. "We don't just contact the customer for a past-due payment, we contact the customer to make the path to business with them smoother."

Pamela K. Hustus, credit manager, S&S Worldwide, Inc. agrees with Tilford's assessment of the customer service function within credit departments. She emphasized the importance of retaining current customers while pursuing new ones.

"We try to resolve any situation that a customer has. If it's a freight issue, a surcharge issue . . . we try to make customers as content as possible without aggravating them in any way. If a customer is transferred three, four, or five times, by the time you get them, they are livid. If something comes in to the credit department, we will handle it ourselves."

Oftentimes, Hustus and others within her department will learn of potential problems from monthly delinquency reports. The credit department will then handle problems and requests such as incorrect pricing, missing items, and proof of deliveries.

"Overall, it's been a big improvement. If [a customer] gets someone's name and there's a good rapport, the customer will ask for that person again. I had one yesterday. I took care of a customer's issue and she got my name. She called back later with another question and asked for me.

"I believe that this is the way to go now, because people are getting very picky about who they'll deal with. They're very price competitive. They'll say they found something cheaper elsewhere, and we'll refund that price."

One drawback to this approach is that it involves an increased workload for employees, Hustus said, but at S&S Worldwide, they have organized a customer retention team to make the customer as happy as possible and it's opened a lot of eyes.

"We've dealt with issues of communicating among departments. It's opened doors of communication within the company as well as outside."

Despite the increased workload, it's a safe bet that companies will continue to discover the benefits of integrating customer service functions within the credit department.

Kevin C. Naff is communications associate/editor, NACM.
COPYRIGHT 1995 National Association of Credit Management
No portion of this article can be reproduced without the express written permission from the copyright holder.
Copyright 1995 Gale, Cengage Learning. All rights reserved.

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Author:Naff, Kevin C.
Publication:Business Credit
Date:May 1, 1995
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