How do you choose your credit manager

From time to time I am asked to advise companies on the skills necessary to hire a credit manager. This is not an easy request since every company is unique by virtue of its products, services, size, number of employees, and above all the management who are in charge of running the company. Choosing a credit manager has to not only encompass the ideas of whether that employee will “fit” the corporate culture but has to also deal with the understanding of what a credit manager could and should do for that particular company.

In one basic sense a credit manager should act as the link between helping the company to maximize its sales and at the same time to safe guard its assets. Helping the company to maximize its sales means that if a credit manager has experience in sales, if he has walked in the shoes of the sales person, he will be able to understand the difficulties involved in trying to solicit new accounts and maintain the present accounts. I suppose then that one attribute that a credit manager should have is the ability to understand the activities involved in pursuing and maintaining sales, which will in turn influence credit policy.

Although we probably understand that a credit manager should have skills such as professionalism, a strong work ethic, and a positive attitude etc., these are skills needed for every position. However, what is unique about the credit management position is that it can encompass knowledge and experiences traversing a wide range of areas and departments within a company. In my view, a credit manager who has experience in operations, marketing, accounting, customer service, logistics, IT, administration, or human resources is one who brings to the credit management position a depth of knowledge for the problems and issues that eventually impact the credit management function, goals, policies and procedures.

Personally, when I am asked to review the credentials of a candidate for credit manager, instead of only focusing on whether the candidate has experience to manage all of the company’s credit activities, I am more inclined to look within a candidate’s background for some diversity of professional experience. In this way I feel that the candidate’s view of the credit function will be more balanced, have a greater contribution, and be more supportive of the company’s goals.