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CREDIT MANAGEMENT

SHINING THROUGH THE RECESSION

Thanks to the economic downturn, the profile of the credit management function continues to rise in many organisations with credit directors sitting on some boards.

Downsizing tends to be less of an issue for credit control than other finance functions unless the work has been outsourced or the organisation has relocated. Some businesses that previously outsourced credit control have realised that it is more efficient to bring it back in–house.

The recession has given credit managers the chance to shine and highlight their value to the business. Senior management up to CEO and CFO level is taking notice of what they are doing, but scope exists for them to raise their profiles even further. While organisations are replacing credit control staff members who move on, they are not expanding the teams. As a result, there has been no noticeable uplift in hiring and little movement in salaries in the sector over the past 12 months.

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With the eurozone crisis affecting businesses that trade internationally, controls are becoming much tighter. Credit managers must increasingly carry out their duties in foreign jurisdictions with a particular focus on customer intelligence. As a result, candidates with experience of international debt collection who speak foreign languages – particularly French, Spanish and German – can earn a premium of up to £4,000 on top of their basic salary. In general, credit managers are more focused on customer risk analysis than they were five years ago as they aim to minimise their organisations’ exposure.

Credit management is developing into a well–regarded profession that offers a clear career path and good remuneration at more senior levels. As credit is a people–based industry, the best candidates can read others and engage both internally and externally while having a firm grip on the numbers. They also take a commercial approach and understand the impact of their activities on the rest of the business. At interview, credit managers will be expected to show that they have implemented efficient and robust processes and procedures within their organisations.

Employers view qualifications from the Institute of Credit Management (ICM) as desirable and it is rare to see credit manager job specifications that do not request ICM–qualified candidates. They have also focused more on training their credit teams to create a more efficient department, as well as to discourage people from leaving due to a lack of support. In credit management, a clear correlation exists between training and business performance as there are key performance indicators and benchmarks relating to days sales outstanding, bad debt and query levels.

View this year's Accountancy & Finance Salary Guide.