December 8, 2022

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Credit Congress Spotlight: Transform into a Strategic Leader

Annacaroline Caruso, editor in chief

Credit professionals make dozens if not hundreds of decisions each day—decisions that play a massive role in the success or downfall of their company. But in order to get recognition from the C-Suite, creditors must adopt a strategic mindset and start making decisions that shape the company’s vision.

Managers can no longer act as a leader in name only. Ensure your spot on the A-Team by separating yourself from the rest as a strategic leader who successfully guides your company through today’s ever-changing economic climate. The primary difference between an operational leader and a strategic leader is the ability to lead for the future, acting as the motivating force for innovation and helping the company reach its long-term goals.

A strategic leadership style requires a skillset that is above and beyond average. In order to market yourself as a strategic leader, you must:

  1. Attack big ideas with a clear plan and remain open-minded.
  2. Have a deep understanding of yourself and others.
  3. Make confident decisions.
  4. Inspire your team to strive for long-term success.
  5. Have the stamina to follow through on strategic plans.
  6. Take accountability.
  7. Maintain a big-picture perspective when making any and all decisions.
  8. Anticipate change.

If these skills were easy to learn, everyone would be a strategic leader. But only the most successful possess these qualities—think Steve Jobs, Oprah Winfrey or Nelson Mandela.

Make 2023 the year you begin the journey from operational leader to strategic leader at NACM’s 127th Credit Congress in Grapevine, Texas. Register for the new Strategic Leadership Track, focused on professional development and prepare to work with the C-Suite of players.

With more than 25 years of management consulting experience, session track instructor Chris DeVany will lead you on an exciting journey. He has coached, consulted and collaborated with executives and management teams in over 300 different organizations in 22 countries and 47 states (he’s working on North Dakota, South Dakota and Alaska). He has worked with the likes of Microsoft, Visa International, GM, Starbucks, Uber, Ulta Beauty, Chipotle and is ready to share lessons learned.

Gain a competitive edge, learn to better direct your team, add value to your organization and develop a deeper understanding of your customer’s needs by participating in this newly developed track of sessions. Session topics include:

Creating a Culture of Trust: Like credit, at the very core of sound business relationships is trust, and intrinsic to trust is the expectation that all will act in a way that is mutually beneficial. Trust is a critical and key component of effective leadership because it breeds stronger working relationships and a healthier organizational culture. Chris will teach you how to create a culture of trust.

Building a High-Performance Team: High-performance teams are aligned with and committed to shared values and vision, working towards a common goal. They are innovative in problem-solving and are known for displaying a high level of communication and collaboration, delivering consistent and superior results. Chris will share best practices with you so that you can inspire your team to open their minds and unlock their creativity to achieve the best results.

Building a Leadership Pipeline: Those who mentor and advocate for others are perceived by others as more effective leaders. Great leaders need to be mentored and great leaders need to mentor. Coaching and mentoring are not only key to retaining top talent but to building a leadership pipeline. Mentorship programs can reduce and reframe personal, structural and cultural barriers that may be holding emerging leaders back from achieving their full potential.

Relationship Building: As a strategic leader, building a reputation and relationships are fundamental to your ability to successfully persuade your team to accomplish its objectives and goals. In our strategic leadership series, we’ll define what persuasion is and how to use it to influence others. Chris will teach you techniques to use power, influence and politics to engage stakeholders effectively and key factors to manage politics.

In the last session of the series, we’ll bring everything we’ve learned together about strategic leadership to ensure that you leave with a solid action plan so you can get started once you return to work.

Tomorrow is the last day to register for Credit Congress with the early bird rate of $849. Be sure to select the option of adding the Strategic Leadership Track during checkout. Spread the knowledge and bring a colleague who has never before attended a Credit Congress at a special rate of $249.

 

 

 

How Creditors Communicate with Customers

Kendall Payton, editorial associate

Creditors do everything possible to ensure timely payment from customers, but collections often come down to effective communication. However, communication in the business world has evolved over recent years as we moved from face-to-face conferences to Zoom and Teams meetings—which raises a question: Do customers respond better to certain communication methods over others?

Different contact methods induce different feelings. For example, a phone call expresses more urgency than an email, and text messages are viewed as more casual and are traditionally reserved for personal relationships.

According to a recent eNews poll, most credit professionals (75%) use email as their primary form of communication with customers, while 21% use phone calls the most often. “Nowadays, everybody uses email as a primary and preferred method of communication because it is fast, easy and there’s a paper trail,” said Yazmin Yepez, CBF, CCRA, CICP, credit supervisor at Mitsubishi Electric Automation, Inc. (Vernon Hills, IL).

But the way you decide to contact a customer will depend on the message you are trying to send. For example, if a customer has to pay a large amount of money in a certain number of days, a phone call would be a better way to express the urgency of a payment. “There is no better way to get emotion across than with a live conversation,” Yepez added.

Email is one of the most commonly understood means of communication because it has been around for a long time and is efficient, which is why it is still so popular. Email is especially helpful for creditors who need to send and receive large amounts of documentation, said Nanci Levin, credit analyst at Argos USA LLC (Irving, TX). “My primary means of communications with customers is email for sure. I can send them a quick email with requests for information, attach anything that’s needed and it allows them to hopefully address it when they have a free minute.”

Text messages are only used by 2% of credit professionals as their most common method of communication with customers. But it is useful for fast responses and is becoming more common in business.

“People are more apt to respond to texts because it’s quick,” said Douglas Swafford with NACM Southern Valley. “Email communication isn’t that old, but someone may or may not answer depending on whether the subject line catches their attention. Some emails can be sent into junk mail which can cause issues as well.” On the other hand, “text is clearer and to the point,” he added.

Customers in the consumer credit arena have long received text messages for missed payment reminders. But B2B relationships are often more complicated than B2C relationships, so it is unclear if text reminders would work the same way in trade credit. “Text can be invading for customers in terms of payment or collecting purposes, crossing the private line,” Yepez said. “Regardless of the age of the recipient, business is business. All communication must be respectful and professional.” Given the many reports of U.S. postal system delays and lost mail, its reliability comes into question. “Postal service for us is definitely a no. We typically don’t even mail invoices or statements anymore,” she added.

The age of your customer is still a factor to consider when communicating. “Gen Z and Millennials are willing to spend an average of 134 minutes on a customer support call,” reads an article from Inc. “Boomers and Gen X, however, will drop the call after just eight minutes. … This has implications for the different sets of customer priorities companies need to consider as they address pain points and generate better experiences for both audiences.”

“… while young B2B customers love communicating over things like email, texting and Slack, Boomers predictably avoid these options,” the article continues. “So how can a B2B company deliver on the speed that Boomers demand, without relying on the same modern solutions their Gen Z counterparts prefer? The answer lies in a human touch.”

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Knowledge of Global Trade Is No Longer Optional

Jamilex Gotay, editorial associate

Global trade has gone through a lot of changes over the last few years as the pandemic and the Russia-Ukraine war forced many businesses to rethink their traditional trade relationships. But despite talk about a possible end to globalization, international trade is expanding every year. 

If a business ever hopes to increase profits, it will need to dabble in foreign markets—and it is up to the credit department to mitigate those new risks. So, just because your company is not selling overseas today does not mean it will not tomorrow. “No matter your company, at some point you may have to explore foreign markets to increase your company’s market share,” said Mark Levine, CCE, CICP, credit risk manager at American Tire Distributors, Inc. (Huntersville, NC). “And if you’re the person who knows how to help your company do that, you make yourself much more valuable.”

Knowledge of global trade is no longer optional in today’s world. Levine started learning about the nuances of international credit while his company was still only selling to domestic customers. But by successfully completing FCIB’s International Credit and Risk Management (ICRM) online course, Levine was able to help his company make smart international sales. Relevant international topics taught during the ICRM course include:

  • Incoterms
  • Sovereign risk
  • Currency exchange rates
  • How culture impacts payment trends
  • Methods to secure international payments
  • Updated international trade laws

By having international credit skills in your wheelhouse, you will be setting yourself up for long-term success. Nathan Hutton, CICP, global credit manager at Donaldson Company, Inc. (Minneapolis, MN) was a domestic credit manager before taking the ICRM course. He was later asked to help global colleagues at his company.

“If I hadn’t gotten involved in our global operations or received my CICP certification, I would not be where I am today,” Hutton said. “Before taking the course, I had only been exposed to U.S.-based credit and collections ideas, but then I learned how trade credit worked in different parts of the world. It is important to realize that domestic and international credit is very different and you need a good foundation to gain a broader overview. The ICRM course should be required for all global credit managers.”

ICRM Instructor Val Venable, CCE, CICP, ICCE, is a credit industry veteran and started off as a student in the class herself. “Your company may not be doing international trade right now but maybe a year or two down the road, your career could easily shift towards international credit,” she said. “As many people in international credit know, a lot of times you’re working odd hours and traveling overseas.”

Venable not only has the on-the-ground experience, but she uses the mistakes she made as learning tools to help course participants gain invaluable insights into the risks of global trade. Although the online course depends upon each participant to work through the written content and test their knowledge with short quizzes, audio content also supports learning. The course instructor monitors responses to discussion questions, responds to questions and manages team progress to ensure that students are working through course modules at the same time. Scheduled live content reviews bring the course participants and the instructor together.

The ICRM’s online, 13-week format allows flexibility for credit professionals in any time zone. Students who recently passed the ICRM course hailed from around the world—including India, Singapore, the Netherlands, the U.S., Saudi Arabia, Brazil, United Arab Emirates, Mexico and China. By passing the ICRM, you will permanently become a part of a global expert network filled with credit friends who you can count on for years to come.

Register for the Winter 2023 course by tomorrow, Dec. 9, to receive early bird tuition. The class starts on Jan. 9 and ends on April 16.

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Tips for Surviving a Company Merger

Kendall Payton, editorial associate

When a company merges with or acquires another, some conflicts will always rise to the surface. How do both businesses combine organizational structure? What policies are adopted? Which employees stay and who goes?

For every overlapping role, one position will survive and the other will be laid off. Once a merger is announced, you should treat it as if you are interviewing for the job all over again, said Heidi Lindgren-Boyce, CCE, senior credit manager at Star Rentals (Kent, WA).

Typically, in M&As smaller companies are more vulnerable, as they can become overtaken once merged with large monopoly-like businesses—so how can your credit department ensure survival? “If your company is the one that’s bigger than the other, and the bigger one bought the smaller—there’s usually no say,” Lindgren-Boyce said. “My education through NACM allowed me to survive because I had higher credentials than the company that bought us out. NACM education truly made a difference. My staff had their CBA’s, I had my CBF and we had taken all the CAP courses. That gave us an edge over people who weren’t as well trained.”

Credentials can set yourself apart from other credit professionals during a merger or acquisition and save you from being placed on the chopping block. It shows you take your career seriously. “You have to let people know who you are and what your value is. Your lack of credentials could be something that’s holding you back because if another company has employees with them, that is a one-up over yours,” said Chris Ring with NACM’s Secured Transaction Services.

If you want to survive, you need to show as much educational experience as possible—and credentials can be a bridge to more opportunities for growth and knowledge within your company. “I do think having your CBA, CBF, CCE, or ICCE will get you noticed by upper management if they buy your company out,” Lindgren-Boyce said. “And even if your department got imploded or moved out, I always tell people those credentials follow you, not your company. That is a great way to get your foot in the door anywhere else.”

Another challenge that typically emerges during a merger or acquisition is work culture differences, structure and new workloads, she added. “In my experience with a previous company, there were a lot of duplications of customer accounts. I saw a lot of what we determined as bad-debt accounts where we sued, collected, had write-offs and the entity that bought us out was still selling to them—so it made it really difficult to merge,” she added.

These types of account difficulties also can cause legal issues, making companies more likely to draw the process out. “Our company was maintained as a separate entity for a while. It took about a year for them to legally change the name, so it posed a lot of legal challenges in the collections side,” Lindgren-Boyce said.

View the schedule of upcoming in-house courses, online classes and exams if you are interested in becoming certified. For more information about NACM’s Professional Certification Program, click here.

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