eNews August 27
In the News
August 27, 2020
What to Do When You Are Unpleasantly Surprised
—Linda Swindling, JD, CSP
How to Take Control in Critical Situations
Take control of critical or highly stressful situations through questions. Police, medical professionals, and firefighters ask questions: "Are you hurt?" "Did you see what happened?" "Are there others in the building?" "What can you tell me?" When you are communicating with someone facing a stressful situation, ask questions to provide you the information you need. Answering questions helps people think and focus their communication.
When the negative news involves your employment, it can feel like a personal attack. Have you ever tried to remain positive when the conversation involves discipline, poor performance, layoffs, or termination? Consider these situations.
- You arrive to discuss one matter with your boss and suddenly face an entirely different situation which negatively impacts your employment.
- Your client surprises you with bad news like dissatisfaction with your delivery schedule or company budget cuts that will affect you.
- Your team member makes statements in a meeting that are different from what you discussed and makes you appear uninformed.
- Your time to make a presentation is dramatically shortened.
- People ask questions you aren't prepared to answer.
- Your client is insulted, and there is a chill in the room that you can't explain.
- You receive a call telling you that your services are no longer required.
How do you stay calm under pressure?
Use the ASK Strategy
When you are in a stressful situation, use the ASK Strategy. Emotions or reactions can sabotage you and keep you from thinking clearly and objectively. Instead of allowing emotions to control you, use them as a signal to pay attention and to focus on what questions to ask next.
A: Aware
S: Seek clarity
K: Know your next best step or request
Aware
Be aware of what is happening. Start asking yourself questions. What can you determine by someone else's demeanor, words, voice tone, and posture? What about you? What are you aware of right now at this moment in time?
For instance, if you receive a last-minute change before you make a presentation, what are you noticing? Pay attention to your heart rate, your thoughts, your breathing, and how your body is reacting. Are you breathing too shallowly or quickly? If so, attempt to slow your breath down by counting as you inhale and then as you exhale. Are your eyes tearing up or unable to focus? If all else fails, be aware of your surroundings. For instance, pay attention to the fabric of your chair, the color of the walls or the flooring.
Seek Clarification
Seek insight or understanding. Are you missing context or are you unsure of the discussion? Seek clarity by asking others "what" and "how" questions.
If your boss gives you unfavorable feedback on your performance, ask questions and repeat the exact words you hear without emotion. Definitions and understanding of words are different. For further clarity, ask for examples: "Could you give me an example of that behavior?" or "Could you describe what you mean when you say _____?"
Maintain eye contact but take notes if possible. Note taking helps you stay logical, objective and allows you to maintain calm during the moment. If questioned about what you are doing, say, "Your comments are important to me. I want to make sure I get them down correctly before responding."
Know
With the situation at hand, you should now know what to do next. Remember, you don't have to have all the details filled in, just know what is next. If you don't know what you should do next, then ask more questions to help you gain clarity.
If your client tells you that you will no longer be servicing an account, know what request makes the most sense right now. Do you need to ask a question to clear up a misunderstanding? Should you ask to determine which options are available to you with the news you've just been given? Is your best request a break so you can investigate concerns and have a more informed response?
Negotiation speaker, author and expert Linda Swindling, JD, CSP, helps leaders negotiate everything from big deals to workplace drama using proven strategies that drive results without driving others away. Linda helps leaders enhance business relationships; improve sales opportunities; communicate more effectively so they are heard and understood; and to have the courage and confidence to ask outrageously to get what they really want. To view the full article and more, go to https://www.lindaswindling.com/.
NACM Credit Congress & Expo – Extended til September 30
We’ve had many requests to extend access to the online Educational Sessions and the Expo Hall, so we’re giving you an extra 30 days!
Everyone is juggling so much right now, and deadlines can slip by us. We hope having a few extra weeks to take advantage of the 50 Educational Sessions and 30 Expo Booths will be a welcome bonus.
Visit the Showcase Now!
Tennessee Enacts New Construction Legislation in 2020
—Brian Dobbs and Wearen Hughes
The Tennessee Construction Industry Payment Protection Act was signed into law on June 22. The Act addresses or reallocates certain risks associated with non-payment on construction projects under Tennessee’s Prompt Pay Act (PPA) and is intended to increase clarity and consistency in the PPA and in Tennessee’s mechanics’ lien law, Truth in Construction and Consumer Protection Act, and construction defect notice statutes, as well as amending Tennessee’s statute of repose for construction and design defects.
The changes took effect July 1, and apply to actions occurring and contracts entered into, amended, or renewed on or after that date. Highlights of the Act include the following.
Clarifications Regarding Payment and Retainage Requirements
The PPA requires retainage to be deposited into a separate, interest-bearing escrow account with a third party and generally requires the release of retainage within 90 days after substantial completion of the project. Failure to comply with these requirements is a Class A misdemeanor, subject to potential criminal fines of $3,000 per day. Failure to properly escrow retainage also exposes the withholding party to civil damages of $300 per day.
Injunctive Relief and Stopping Work
The PPA permits parties who have not timely received payment to send a notice to the nonpaying party. If the party does not respond within 10 days with “adequate legal reasons” for not paying, the unpaid party, among other things, may seek injunctive relief—presumably requiring payment. Previously, the unpaid party had to furnish a bond in double the amount claimed before obtaining injunctive relief. The multiple now has been removed, and the bond must equal the amount claimed. The PPA also now provides that an arbitration provision does not prevent a party from seeking injunctive relief in court.
New language also permits a party to stop work if it does not receive payment or adequate legal reasons for nonpayment and entitles the party to an extension of the contract schedule.
Notice to Owner of Beginning Work No Longer Required on Commercial Projects
Before beginning work on any project, the Truth in Construction and Consumer Protection Act previously required a contractor to deliver a written notice to the owner it was about to begin improvements and there would be a lien on the property to secure payment. That section has been revised to apply only to improvements of residential real property (defined as a building consisting of one to four dwelling units where the owner intends to reside in one of the units).
Lien Subordination Agreements Possibly No Longer Enforceable
A provision in the PPA states that certain provisions of the Act may not be waived by contract. Added to that list is the provision in the mechanics’ lien statutes that establishes the time of attachment of mechanics’ liens. Those liens attach upon “visible commencement of operations,” which generally means the start of construction (with some exceptions). The intent of the addition is not clear, but it calls into question the enforceability of “subordination agreements,” by which project lenders seek to assure the priority of their liens when construction has commenced before the recording of a mortgage or deed of trust.
Brian Dobbs is a member at Bass, Berry & Sims PLC where he represents clients in the drafting and negotiation of construction and design contracts for real estate projects throughout the United States. Brian also defends clients in various types of construction-related claims and disputes, including contractor licensing matters, pre- and post-award bidding disputes, among other matters.
Wearen Hughes is a member at Bass, Berry & Sims PLC and focuses his practice on construction contracting and litigation, and dispute resolution. Wearen assists clients with construction and related real estate needs, minimizing exposure by helping them navigate design, construction and related contracts and various project delivery options.
Credit Managing From Afar
—Michael Miller, managing editor
While many credit departments have returned to the office in some capacity, many are still working remotely. According to NACM’s “August 2020 Professional Skills Survey,” roughly 45% of respondents said they are working remotely due to COVID-19. That’s a drastic decline from March, when almost three-fourths of respondents reported their credit department was working remotely.
The transition of managing a company’s accounts receivable and credit portfolios in the office to the home office, coffee shop or any place with internet access was fast for some. Adapting to new challenges was the No. 1 surprise to working remotely, reported by nearly half of the respondents.
To the surprise of Doug Proske, credit manager with ECHO, Inc., “We were more ready to manage our business remotely than originally thought.” Most of this has to do with how his department had planned for their future—even before the impact of the COVID-19 pandemic. When he took over the department a year ago, Proske and the credit team followed a path that eventually left them in a better situation when the outbreak hit the U.S. earlier this year. Credit applications were scanned for online access; their UCC process left the manual paperwork stages behind for online processing, the phone systems were setup for better remote access and customers were persuaded to sign up for ACH payments. “When the word came down that we were to work remotely, the only thing that changed for us was not having meetings in person. My team adapted well.”
However, not everything worked out as planned. “What made working from home a challenge was the atmosphere that some of my team members were in—either working in the dining room, living room, etc.,” said Proske. “It was difficult for them and myself to separate home life from work life.” Among the issues faced were internet speed, child care and other family interruptions. Yet, the credit department addressed the issues together to discuss how to best remove the distractions or work with them during the day. The ability to keep the work-life balance was mentioned by nearly 40% of survey respondents as the second-most experienced surprise.
Just under a third of respondents said they found it challenging to communicate with co-workers. Proske worked with his team in what he called their “morning huddle.” This half-hour, daily meeting was established to discuss issues and daily goals among other items. “I was doing this in the office as well, and I will say it became a real important time of the day when we went remote. The team also feels that they have more access to me remotely than when in the office.”
Proske recently sent “thank you” cards to his team to express his gratitude and for their hard work during the past several months. “They each responded positively stating that they are thrilled to work on a team where we all care about each other. Overall, I feel we became stronger as a team than ever before.”
September 8, 2020 10am ET
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UnitedKS’s senior managing partner, Cengiz Söylemezoğlu, will provide insight into Turkish insolvency law. In this webinar, Cengiz will discuss the following issues:
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Author George Ellis once said, “It’s better to have it and not need it than to need it and not have it.” Many people today abide by this philosophy in some way, including the credit department where guidelines are in place to prepare for potential issues. A recurring problem in the business credit industry is fraud as scammers continued to find new ways to steal from companies, whether it’s money or confidential information. Ellis’ words of wisdom can apply to the issue of fraud in the credit department under the notion that it’s better to have security measures in place to prevent a possible breach rather than find oneself unprepared.
The necessity for enhanced security measures comes with the latest push in technology due to the ongoing pandemic, Tim Horton, head of global merchant security and fraud solutions at Fiserv, told a PYMNTS Masterclass. By the end of the year alone, he said, Fiserv anticipates “more than 8 million new digital buyers over the age of 45,” having seen retailers’ online purchases double since last year in addition to a 250% increase in online grocery sales. However, fraudsters aren’t just after the usual payment information but rather any personally identifiable information (PII).
“We have data that shows 40% of consumers feel that they would not continue to do business with merchants who they have deemed irresponsible with data collection and storage,” Horton said in the article. “Businesses must prioritize security of personal customer data not only to prevent financial loss, but to preserve the trust of their consumer as businesses work to keep personally identifiable information out of the hands of cybercriminals.”
The same can be said for credit departments—if credit professionals don’t secure customers’ PII, it is more likely that information will fall into the wrong hands. Yet, with most problems, there are solutions, one of which is developing partnerships with tech-savvy companies such as Fiserv. As a leading global provider of payments and financial services technology solutions, Fiserv provides leading fraud and compliance solutions to protect companies from all kinds of financial crimes, ranging from check and electronic payment fraud to money laundering, sanctions violations and tax evasion.
According to Fiserv, more than 1,200 organizations across 70 countries use its financial crime risk management software that is designed to improve risk protection, reduce operational costs, enhance investigation efficiency, implement a risk-based approach to suspicious activity detection, and more.
“Effective financial crime risk management is more critical than ever,” Fiserv states. “Financial institutions struggle to keep up with compliance while managing costs. Meanwhile, criminals develop new schemes that necessitate new regulations and adaptable risk management solutions. … [Our software] is highly effective, efficient and adaptive to uncover even the most sophisticated crime schemes.”
Gasan Awad, vice president of product management for financial crime and risk management at Fiserv, wrote about how machine learning is a significant technological tool in the fight against fraud in his article, “Five Tech Trends That Can Transform How Financial Institutions Detect and Prevent Financial Crime.” Described as “a subset of AI,” Awad said machine learning is when systems learn from new data rather than only perform programmed functions. Machine learning provides companies with the ability to identify “patterns of behavior from large data sources,” which can then be used in fraud detection.
“Machine learning can help the financial institution detect potential fraud and money laundering earlier—in real time—and more accurately,” Awad wrote. “The resulting reduction in false positives and increase in prevention can improve customer satisfaction and retention. The automation will also enable financial institutions to deploy employees across higher value tasks.”
To learn more, please contact Lisa Killingsworth-Cohen at 512-241-9514 or This email address is being protected from spambots. You need JavaScript enabled to view it..
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Date & Time Title Speakers
SEP 8 10am ET Cengiz Söylemezoglu, Managing Partner SEP 9 3pm ET Kevin Seltzer, Esq. Seltzer & Seltzer, LC St. Louis, MS
SEP 10 10am ET Roberto Gilardino SEP 14 3pm ET Timothy R. Moorhead, Esq. |