Generations at Work

Posted by on July 2, 2013 at 3:59 pm. No comments

June 2013 ICEL Meeting Recap by Janae Jeffs, CCE, Muir Enterprises, Inc.

June’s ICEL meeting was presented by Lynn Richardson SPHR, CCF, a former Vice President of Human Resources for SOS Employment Group. He is currently retired. His insight and experiences made for a very informative meeting.

In the workplace there are diverse generations that need to be managed. Lynn started his presentation by explaining traits of the different generations. He listed many traits but his approach in the area of “Respect For Management” provided an interesting new perspective.

1) Traditionalists -Though there are few still working, we need to understand their values. They respected the Chain of Command as a matter of course. Job hopping was not an option – if you didn’t put your time in, there would be no pension at retirement. The team is more important than the individual. Work only; families didn’t count. Face-to-face communication is preferred.

2) Baby Boomers – Most managers are from this time period. They were the “WHY? Generation.” They challenged the status quo and introduced technology in the workplace. Phone & direct communication is their preference.

3) Xers – This is the first generation to learn technology in the home as they were growing up. They prefer straight–to-the-point communication style (emails).2) Baby Boomers – Most managers are from this time period. They were the “WHY? Generation.” They challenged the status quo and introduced technology in the workplace. Phone & direct communication is their preference.1) Traditionalists -Though there are few still working, we need to understand their values. They respected the Chain of Command as a matter of course. Job hopping was not an option – if you didn’t put your time in, there would be no pension at retirement. The team is more important than the individual. Work only; families didn’t count. Face-to-face communication is preferred.1) Traditionalists -Though there are few still working, we need to understand their values. They respected the Chain of Command as a matter of course. Job hopping was not an option – if you didn’t put your time in, there would be no pension at retirement. The team is more important than the individual. Work only; families didn’t count. Face-to-face communication is preferred.

4) Millennials – They want meaningful work and new skills. They ask questions to get ahead. Multitasking is easy for this group. They prefer indirect communication (texting).

A new way to manage all these different types of people is called “Emerging Paradigm Shift.” Lynn Richardson talked about ways to implement this approach. As a manager, you need to understand what will create success in your company. The Emerging Paradigm Shift uses success factors such as: in what way you can inspire people and monitor the process. It will show that effective motivating is good leadership.

Department heads and bosses must become leader-managers. A leader influences and a manger is responsible for getting the work done. One way to be a good leader-manager is to be a people developer – inspire your team and create loyalty. Lynn discussed the variances of using intrinsic rewards vs. extrinsic rewards. Intrinsic rewards are achievements, individual recognition, career advancement and personal growth. Whereas extrinsic rewards are competitive pay, benefits, and job security for the individual worker. As a manager, we need to know which type of award is best for each individual and their generation. Diverse awards for a diverse group will encourage all age levels to stick around for a longer time.

We need to invest in our companies greatest assets: its workers.

ICEL Recap: Stop Being Bullied by Bad Customers

Posted by on June 3, 2013 at 8:05 pm. No comments

by Shane Inglesby, CCE, Geneva Rock Products, Inc.

Nina Flurer, CCE, a regional credit manager with H&E Equipment Services, Inc. presented at the May ICEL meeting. She addressed the topic of how to stop being bullied by bad customers – a topic to which most all credit managers can relate.

Ironically enough, the term bully can be abused (no pun intended). Just because someone engages in behavior that someone does not like or agree with, does not necessarily mean it is abusive. Nina encouraged attendees to incorporate the “reasonable person test.” This test requires asking if most people would consider what the other person is saying or doing to be inappropriate or unacceptable.

Once it has been determined that the actions of a customer are that of a bully, his or her actions will typically fall into one of two categories – explosive or coercive. Explosive behaviors will include threats, fright or harm. Coercive behavior will often times include threats or actual force.

Bullying behavior is typically only experienced when three variables come together: a desperate customer must perceive some type of weakness in an individual and/or organization and that organization or individual must demonstrate evadable policies. Read full article

The Imperative Partnership Between Credit & Sales

Posted by on April 3, 2013 at 3:08 pm. No comments

By Bryan Simnitt, Director of Sales, Nicholas & Company

The Partnership between sales and credit is imperative for success.

Why the sales driven organization must encourage partnership between sales and credit to succeed.

The selling team of yesteryear would have a hard time getting along, or even understanding the business world of today. Things have changed such that a client’s credit worthiness is just as, or even more important than, the gross revenue potential of that coveted client. In the old days when the “big sale” ruled all, we (the selling organization) kept the credit department quite busy cleaning up when one of those big sales turned into a big collection nightmare.

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Credit/Sales Smack Down

Posted by on March 4, 2013 at 6:46 pm. No comments

By Georgette Bevan, CCE, NACM Business Credit Services

Have you experienced ballistic moments dealing with sales people? If you have, you are not alone. At times, the friction between credit & sales produces a duel of epic proportion; well it seems like it at the time.

Sales: Excited voice “I have a new customer that is ‘golden’ and they want to buy A LOT – RIGHT NOW!”

Credit: Up go the hackles . . . “Ummm, looking at their credit report and payment history, the only possible way we can sell them is cash in advance.”

Sales: Angry “Oh Come On! They’re good for it!”

Credit and sales have very different personality traits. No wonder there is friction between credit and sales – they are complete opposites.

 Personality traits of credit & sales



Non-risk takers

Conservative at all costs


Want to see the proof in black & white



Risk takers

Driven to make the sale

Adept at overcoming obstacles

Champion at getting people to say “yes”

 While credit and sales are two separate departments yet they do have common goals . . .

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Odds It’s Fraud

Posted by on February 8, 2013 at 4:12 pm. No comments

By Georgette Bevan, CCE, NACM Business Credit Services

Business credit fraud is an intentional plot to scam a business out of “value” without payment. This may be accomplished by providing a credit department with carefully crafted inaccurate information hoping that it goes unnoticed thus allowing the flimflam artist to get away with as much value as possible.

Let’s look at an attempted fraud scenario that happened recently in Utah.

An NACM member received a phone order from a caller in Ohio declaring that they had a “staple emergency” and needed product to be “shipped immediately” through their preferred shipping agent. The member contacted the shipping agent through the Hotmail email address provided and requested a freight quote. An International Shipping Quote was received. The Member received an email from the customer’s Gmail account with instructions to ship overseas and to send them an invoice for full amount of project (product plus freight). Credit card information was provided for payment. The Member was instructed to pay several thousand dollars in freight charges upfront to ship the material. This is where the red flags went up.

The Member asked for the name on the credit card and was given a man’s name. When they called MasterCard to verify they were informed that the card had been issued to a woman.

When your gut feel tells you something is wrong – start reading between the lines and look deeper. Let’s take a closer look at the warnings signs of fraud in this scenario.

Payment upfront – If a customer asks you to advance costs (or pay upfront in their behalf) be cautious. Even if you’ve been given payment in the form of a credit card, a check or even a cashier’s check, you may get left holding the bag when you find out the money is not there. Always verify funds are received before paying up front or refunding money. Asking for the name on the card, the billing address, zip code, card authorization number – any and all information you can as a standard procedure is a good business practice.

Does it make sense? Why is someone in Ohio calling Utah to order material to ship to Denmark? Are there closer sources of supply for this product? Is the request routine to your business or is it unusual?

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NACM Canons of Business Credit Ethics

Posted by on October 31, 2012 at 10:02 pm. No comments

By DeAnna Leahy, CCE, Sunroc Corporation

In our industry credit group meetings, each of us follows along as the Anti-Trust Compliance and Anti-Defamation Statements are read and then we quickly move on to the names submitted for discussion by each of the group members. I sometimes wonder how often members take the time to read and contemplate the information contained on the page entitled Canon of Business Credit Ethics that is located between the Anti-Trust Statement and the individual credit reports. I believe that it would be beneficial for each of us to review these cannons on a regular basis.
The Canons of Business Credit Ethics evolve over time but the essence remains the maintenance of high ethical standards. You may remember the previous statement which is still good advice: 

  1. Justice, equity, and confidence constitute the foundation of credit administration.
  2. Agreements and contracts reflect integrity and should never be breached by either party.
  3. The interchange of credit information must be based upon confidence, cooperation, reciprocity, and confidentiality.
  4. It is deemed unethical to be a party to unwarranted assignments or transfers of an insolvent debtor’s assets nor should creditors participate in secret arrangements.
  5. Creditors should cooperate for the benefit of all in adjustment or liquidation of insolvent estates or companies.
  6. Creditors must render all possible assistance to honest debtors who become insolvent.
  7. Dishonest debtors must be exposed and referred to the authorities.
  8. Cooperation, fairness, and honesty must dominate in all insolvent debtor proceedings.
  9. Costly administrative procedures in the rehabilitation or liquidation of an insolvent debtor shall be avoided at all times.
  10. Members pledge themselves to uphold the integrity, dignity, and honor of the credit professional in all of their business dealings.

The newer version of the Canons of Business Credit Ethics is more generalized to fit a wider variety of situations but calls upon the credit professional to exercise more individual thought when applying the provisions to a much broader global market. view full article at

Personal Guarantees

Posted by on October 11, 2012 at 3:48 pm. No comments

A Simple Agreement to Improve Credit & Collections

By Shane Inglesby, CCE, Geneva Rock Products, Inc.

Credit and collections – it’s what we do for a living. Without collection opportunities, we would not be employed. As much as we bemoan the challenges we confront on a daily basis, we have to admit that this challenge is what puts food on our tables. This reality aside, one signature on a simple agreement can assist in the credit review process and help streamline collections. Obtaining a personal guarantee can literally change the way a credit manager determines credit worthiness and, ultimately, in a worse-case scenario, help collect on a past due balance.

The ultimate goal of a personal guarantee is to bind a third party to pay your company in the event of default on the part of a business that entered into an agreement to purchase and pay for goods and/or services to your company. A properly drafted guarantee agreement can be invaluable in providing additional collection options. If, for whatever reason, a company fails, you have the ability to turn to another source for payment if an individual has signed a personal guarantee.

The obvious question, however, is whether or not the individual providing the guarantee is a good credit risk. There is no point in obtaining an individual’s guarantee if that person is not credit worthy. For this reason, it is imperative that the guarantee agreement contain language that authorizes your company to pull a credit report on the individual signing the document.

NACM Business Credit Services has the ability to access personal credit reports for its members. These reports can provide an invaluable tool in further assessing the credit worthiness of an applicant at a very reasonable cost.

Depending upon who you talk to, personal guarantees can be on the same form as your credit application or on a separate page. Some attorneys believe a separate form from the application lends greater credibility to the binding nature of a guarantee if it is referenced separately from the credit application. My company always includes the personal guaranty on the same document as the credit application. It is a separate agreement from the terms and conditions section that we require to be signed on all applications. As a result, every applicant has the opportunity to sign the guarantee when an application for credit is completed.

There is no question – every applicant will not sign the guarantee. Business owners who have been well-schooled by their attorney and/or accountant will, in many cases, refuse to sign it. Some will even make their position perfectly clear by crossing out the guarantee. The position of my company is, “nothing ventured, nothing guaranteed” (pun intended).

You are assured of receiving no personal guarantee if you do not ask for it. Referencing a personal guarantee communicates to potential customers that additional agreements are or may be needed to move the relationship forward. If there is not sufficient information to make a credit decision, we will ask that a personal guaranty be provided, if one has not already been signed. In most cases, the guarantee allows for a more informed decision based upon the personal credit history of the guarantor.

Most guarantors are typically an officer/owner in the company. The personal credit report can offer insight as to how the individual will administer the affairs of the business based upon their personal business dealings.

In the event an application is received without a personal guarantee and the determination is made that a guarantee is needed, it is not uncommon for the business owner to state that their lawyer and/or accountant had directed them to never sign such an agreement. My response, as politely as possible, is “So you are asking my company to take a greater risk in your business than you are willing as an individual?” I would like to say it works 100% of the time, but it has not. But, in all honesty, it has been very effective.

If, even after all of this deliberation, you still cannot in good faith extend credit, you can always ask if there may be someone else who is willing to provide a guarantee for the company. In most cases, no one else will come forward but, by simply asking, you show a willingness to try and help the customer explore all options before declining the application for credit.

Corporate/business guarantees are another option that can be considered. This approach, in my experience, is far less common but can be used in the event of a less than credit worthy customer that can locate a business entity willing to provide a guaranty.

After credit is extended, ideally all goes well with a positive and profitable relationship having been established. However, there will be times when the benefits of the personal guarantee must be invoked-when a business does not honor its commitments and the guarantor must be brought in to actually “guarantee” payment.

The threat of taking action against the guarantor can sometimes be enough to get the company to make its needed payment. If not, the ultimate purpose of the agreement can be implemented. Approaching the guarantor can often times expedite payment. However, a worst-case scenario may be filing a legal suit where both the customer and the guarantor would be listed as the defendants.

A word of caution regarding personal guarantees – just because an individual signs the guarantee and appears to be credit worthy, it does not mean the guarantor necessarily has assets. Many games can be played, especially by owners of businesses who move personal assets to a spouse or a trust to further limit any potential liability. Personal guarantees can be of great help but they are not the end-all-be-all to providing a remedy for payment issues.

Any company that is not providing the option of a prospective customer signing a personal guarantee is missing out on what can be a very effective tool to gain more customers while helping to reduce credit risk. If you do not have a personal guarantee agreement, consult with your attorney and come up with an agreement, policy and procedure on how to best obtain a guarantee from future customers. Sales will increase and potential losses will be minimized.

Credit & Collection Incentive Program

Posted by on August 28, 2012 at 3:31 pm. No comments

By Georgette Bevan, CCE, NACM Business Credit Services

Times are tough – we all know it. A credit department incentive program may be just the thing to motivate and stimulate credit and collection performance and boost cash flow.

A credit department incentive program should be constructed with several considerations in mind.

  • What are your organization’s goals and objectives?
  • What specific goals do you want to motivate participants to achieve?
  • Is the program in line with your organization’s overall strategic objectives?
  • Do participants posses the knowledge and skills to perform or is additional training and education needed?
  • What type of recognition and/or reward will be effective?

The performance outcomes must be measurable. The program should be tailored to fit the participants and the organization’s culture and industry.

 An incentive program is a team effort! W Edwards Deming affirmed that trying to lift the performance of workers one-at-a-time yields no improvement. He encouraged management to find ways to lift the performance of the whole system.  Participants must have a clear understanding of the goals and the ability to measure the progress.  A well structured incentive program should boost morale, loyalty, and job satisfaction.

 Quarterly measurements and incentive rewards keep department members focused on the goals. Visible evidence such as graphs and charts of progress can bolster motivation.

 Select measurements that balance the objectives of the program:

  1. Percent current
  2. Doubtful/write-off
  3. Collection of doubtful/write off
  4. Days sales outstanding (DSO) or best possible days sales outstanding (BPSDO)

Create a matrix for each category beginning with recent measurements. Whether rewards are monetary or non-monetary, they should spark participant’s interest and should encourage both short term and long term performance.  Rewards that include branded merchandise increase engagement and provide a trophy factor. Cash, gift card and gift certificates are also valued rewards.


85% current = $__

87% current = $__

90% current = $__


> $X = $__

> $Y = $__

> $Z = $__


< $X = $__

< $Y = $__

< $Z = $__


> X days = $__

> Y days = $__

> Z days = $__

The real rewards to the company are a reduction in DSO and increased cash flow. Adjustments should be made when targets are reached to promote continuous improvement. Incentive rewards for innovative new ideas and process improvements can also be included.

An incentive program should increase credit/management collaboration and reinforce the goals and objectives of the company. The credit department should be strategic players in helping management achieve their financial and operational goals. All the credit department needs is an invitation, some information, and a bit of motivation.

When is it Time to Let Go of a Team Member

Posted by on July 11, 2012 at 9:16 pm. No comments

By Susan Archibeque, CCE, Nicholas & Co.

As managers we sometimes hold onto team members believing we can rehabilitate them. You tell yourself that they can do the job and you have invested a lot of time and energy in developing their knowledge and ability, but there comes a time that you need to let them go!

How many of you have finally terminated a team member and gotten a response from the rest of you team like, “what took you so long?” Then you find out how much damage they have really done over the years.

Today it is more important than ever that we have team members that not only can do the job, but positively influence the rest of the team. We need team members that are accountable for their own actions, believers and innovators, that strive to learn and grow with the company.  Read more

The Influential Credit Manager

Posted by on June 4, 2012 at 4:33 pm. No comments

By Georgette Bevan, CCE, Director of Education, NACM Business Credit Services

If only ________________ (insert job title or name) understood that _______ (insert credit wisdom here).”

Has that phrase ever slipped from your lips at work? Credit is a tough and challenging job! You probably wear multiple hats and have numerous irons in the fire. You get caught between customers, sales and management and it can be frustrating. So, how do you get management, sales, customers and others to trust and value your knowledge and experience and to take you seriously? Become more credible and influential.


Increase your credibility by learning everything you can about your job and company. Take classes, attend seminars, read books and read newsletters, search online, network with other credit professionals, find a mentor, go back to school, obtain a NACM Professional Certification. Know your job inside and out. Learn everything you can about your company’s products and services. Learn, understand, practice and don’t take shortcuts. As you increase your knowledge and abilities, you will have a positive impact on those you work with. It will show by improved performance and bottom line results.

Larry Brooks, Credit Manager, ARUP Laboratories, has a 4 year degree and is a CPA and had many years of experience. Larry states that when he achieved the NACM Certified Credit Executive (CCE) designation, co-workers viewed him differently. They saw him as a true credit professional and sought his advice.


Develop a “whatever it takes” attitude. Read full article