Collection Agencies And Credit Department Internal Customers

Advice For
In-House
Debt Col­lec­tion

Col­lec­tion Agen­cies And Credit Depart­ment Inter­nal Customers

By Dean Kaplan

Col­lec­tion agen­cies typ­i­cally think of the Credit Depart­ment as their cus­tomer. But, they need to remem­ber that the Credit Depart­ment has Inter­nal Cus­tomers. This is the sec­ond arti­cle in a four part series of arti­cles which will look at the credit depart­ment in the com­pany set­ting and its need to view the other inter­nal depart­ments it deals with as inter­nal customers.

This arti­cle will explore the impor­tance of not only iden­ti­fy­ing the credit department’s inter­nal cus­tomers, but also under­stand­ing the func­tions and inter­re­la­tion­ships of its cus­tomers. Once a col­lec­tion agency enters the pic­ture, debt col­lec­tors also must under­stand these inter­nal cus­tomers and how they func­tion within the com­pany as a whole. For a col­lec­tion agency to opti­mize the results for its clients, it must be able to pro­vide all nec­es­sary infor­ma­tion to the credit depart­ment, which is in turn dis­sem­i­nated out to inter­nal cus­tomers. In addi­tion, the col­lec­tion agency can uti­lize infor­ma­tion from the credit depart­ment and its inter­nal cus­tomers to fur­ther moti­vate debtors to make payments.

It's impor­tant to main­tain team­work between a business's credit depart­ment and other inter­nal depart­ments to max­i­mize col­lec­tion success

In most com­pa­nies, the inter­nal cus­tomers of the credit depart­ment include the Chief Finan­cial Offi­cer, the con­troller, the sales staff, the cus­tomer ser­vice staff, the ship­ping staff, and the finance staff. All of these func­tional areas pro­vide infor­ma­tion to the credit depart­ment, and receive infor­ma­tion from the credit depart­ment. Obvi­ously, open and sup­port­ive lines of com­mu­ni­ca­tion are essen­tial for the com­pany to oper­ate at max­i­mum effi­ciency and pro­duc­tiv­ity. “Sat­is­fied” inter­nal cus­tomers equate to inter­nal cus­tomers pro­vid­ing and receiv­ing timely information.

The first step to truly iden­ti­fy­ing the inter­nal cus­tomers of the credit depart­ment is to have all employ­ees in the credit depart­ment define their inter­nal cus­tomers. Who do they inter­act with on a daily or reg­u­lar basis? Why do they inter­act with these peo­ple? What is the func­tion of the rela­tion­ship? What infor­ma­tion do they give or receive from these func­tional areas?

Once all the foun­da­tion rela­tion­ships and infor­ma­tion are col­lected, the next step is to cre­ate a flow­chart which clearly rep­re­sents the inflow and out­flow of infor­ma­tion from the credit depart­ment to other func­tional depart­ments through­out the com­pany. This infor­ma­tion may turn out to be very help­ful to the credit man­ager on sev­eral lev­els. It will bet­ter define work­ing rela­tion­ships and also may help improve effi­ciency within the credit depart­ment and the com­pany if dupli­cate efforts or com­mu­ni­ca­tion defi­cien­cies are iden­ti­fied. Use this exer­cise to not only iden­tify inter­nal cus­tomers but also depart­ment func­tional improve­ment opportunities.

If col­lec­tion agen­cies are involved in the credit depart­ment oper­a­tions, add their func­tions to the flow chart. Iden­tify what infor­ma­tion they need to pro­vide the credit depart­ment to ensure all nec­es­sary and salient infor­ma­tion is being com­mu­ni­cated to inter­nal cus­tomers through­out the com­pany. Iden­tify what inter­nal infor­ma­tion needs to be com­mu­ni­cated to debt col­lec­tors to max­i­mize their col­lec­tion suc­cess and the credit department’s productivity.

This arti­cle broadly dis­cussed the credit depart­ment and its need to under­stand who its inter­nal cus­tomers are. The third arti­cle in this four part series will delve fur­ther into how the credit depart­ment can iden­tify and under­stand the needs and require­ments of its inter­nal cus­tomers. It will con­tinue to also dis­cuss how agen­cies, when involved in a company’s col­lec­tion efforts, must be an inte­gral part of the inter­nal cus­tomer sat­is­fac­tion umbrella. Click here to read the third arti­cle Col­lec­tion Agen­cies And Inter­nal Cus­tomer Sat­is­fac­tion. Click here if you missed the first arti­cle Col­lec­tion Agen­cies Work­ing For Credit Departments.

The Kaplan Group is a bou­tique col­lec­tion agency spe­cial­iz­ing in large (over $10,000) debt col­lec­tions due from busi­nesses. Founded in 1991, the com­pany has a stel­lar rep­u­ta­tion (A+ rat­ing with the Bet­ter Busi­ness Bureau) and is rec­og­nized as one of the lead­ing col­lec­tion agen­cies for results on large and com­plex mat­ters.

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