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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