While Wilma J. Hanson, CCE, credit manager for Tubesales Company (Forest Park, Georgia), has ultimate responsibility for the success of the credit and collections function, she never has attempted to run the show herself. Relying on her credit staff for almost everything has been her key to success over the years.

Here's how she has developed a competent staff that is able to handle the majority of day-to-day responsibilities in the department.

Editor's Note: This article originally appeared in the Credit & Collection Manager's Letter, which Credit Today purchased in 2006.

Hiring

It begins with the selection process. Hanson looks for four qualities in an applicant:

• An open mind. "This is one of the most important qualifications, given that every account presents a different experience," she explains.

• Analytical ability. This addresses the person's ability to work with numbers, a time-consuming but vital part of the job.

• Self-reliance. Hanson looks for people who can take charge and make decisions. To assess this capacity, as part of the interview Hanson poses theoretical credit and collection problems and asks the applicant how he or she would handle them.

• Past experience. While it's not required, Hanson prefers applicants who have had previous experience in the credit and collections field.

Training

Hanson offers two types of training:

• Introductory training.
  

  Training for new employees has two components:

  • Hanson spends some time with the new person and discusses the overall job, the department, and the company.

  • She describes the second component as "each one, train one." Here, Hanson pairs up the new employee with a veteran who knows the details of each job.

• Ongoing training.
  

  Whenever Hanson receives information on educational seminars, she determines which ones would be useful for her staff. Going to seminars gives the employees the opportunity to receive additional training in such areas as financial analysis, telephone skills, credit and collections ethics, customer service, international credit, and bankruptcies.

Department Structure

"We experimented with a number of different ways of organizing the department," Hanson explains. In the end, she decided to assign each staff member to a number of accounts, for which the employee provides "soup to nuts" service. "This system has turned out to be the most effective one," says Hanson.

Each credit representative does the following:

• Assigns the credit lines for his or her customers.

• Approves orders.

• Follows up on discrepancies.

• Deals with problems.

• Handles collection activity.

Why does Hanson require each of her employees to provide full service for his or her accounts, rather than having specialists for each phase of account management? She gives three reasons:

• The arrangement provides the ultimate in customer service. If a customer has any kind of credit and collection problem, he or she need make only one call to one person, rather than having to call one person for credit approval, another for a problem, and still a third for collection issues.

• The arrangement benefits Tubesales. "Our account representatives get to know their customers personally and become familiar with the way they do business," Hanson explains. "This helps them make the most prudent credit decisions. For example, if a delinquent customer says 'The check is in the mail,' my account representative knows that customer well enough to know whether he or she is telling the truth. If so, the rep can approve the next order. If experience warns that the check is probably not in the mail, the rep can hold the order."

• Finally, the arrangement provides diverse work opportunities for the account representatives. No one suffers boredom from doing the same job over and over. Each day brings a new round of accounts, order approvals, problems to solve, etc., all of which helps to develop employees with well-rounded credit and collection skills.

Communication

To encourage cross-fertilization of ideas, Hanson meets with her staff once a month to discuss problems and share solutions.

"Recently, for example, one of our people came up with the idea of putting all of our form letters on our mainframe," Hanson says. "Another came up with an idea that has greatly reduced the need for credit memos."

Management

Hanson has some established policies for the department, but for the most part she gives her account representatives as much free rein as possible. "They set their own routines and their own schedules," she states. "I let them arrange their work in ways that are comfortable for them."

Hanson trusts her people to make the right decisions, but if they get to the point where they need help, she is available. "For example, if a customer wants to exceed his credit limit, I need to make that decision," she states. "I also become involved in any pending litigation.

"I believe that the people who do the actual work are the real experts in how to get it done," she concludes.

Editor's Note: The above article originally appeared in the Credit & Collection Manager's Letter, a newsletter purchased by Credit Today in 2006. This article originally appeared prior to 2000.