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Why Sales And Credit Departments Need to Work Together in Australia

Ferdi Nel15 October 2013

Why Sales And Credit Departments Need to Work Together in Australia

Credit and sales are two functions which have always been at odds for dominance. Each department believes that they are more important than the other.

The Opinions of Each Side

Like in many other countries throughout the world, in Australia the credit departments believe that sales is fixated only on making the sale regardless of the cost. They believe that sales has a tunnel vision and they never consider the possibility of collecting on the account. At their worst, sales personnel are considered to be pushy employees who only believe in selling their product or service to prospective customers without waiting to think about profitability. They are driven by incentive and are completely focused on their quotas.

On the other hand, the sales departments wonder if people in credit have any idea of what is really going on outside in the market. They think that credit employees are focused obsessively on the small details that don’t really have an important impact on the bigger impact. They think that credit managers try hard to come up with new ways of delaying and setting up road blocks for killing the sale. They believe that credit departments are more like sales prevention department. They believe that the sales department is the company’s lifeblood because they drive the revenue.

Each department has a story of its own and they don’t take the time to understand what challenges are faced by the others. If each department can actually get together and focus on the larger picture then it is possible for organizations to run profitably and smoothly. It is important to understand that both departments are equally important and that neither can effectively perform without the help of the other.

Sales And Credit Working Together is the Only Solution

The success of a company relies on sales and credit working together harmoniously to bring in quality business which can provide overall growth. If both departments agree on this fact and consider it to be their sole goal, then the relationship’s stereotypical characterization will be replaced. A little patience and some sense of humor are required for the two departments to work together and even enjoy coexistence. One of the best ways to improve the relationship is by understanding that credit and sales are both on the same side of the game. Improving communications between the two departments is the best thing that a company can do to help credit and sales.

Some Helpful Tips

Given below are a few tips on how to improve the relationship between the credit and sales departments in any organization:

Share Information

Credit management can only be successful if the department has timely, accurate and complete information. If information is shared throughout departments then it will eliminate all the misunderstandings and will help improve the efficiency and effectiveness of sales and credit. Sales department must be encouraged to collect all the required credit information from the customer at the very first meeting. By explaining what type of information is needed, how it will affect sale and why the information is needed, it is possible for the credit employees to improve the response to their requests.

Credit should ensure that sales understands that you are also interested in the sale. The more information is provided, the better are the chances that credit can approve the new account or come up with a compromise solution. Explain that credit can even secure transactions that are riskier which will otherwise not be approved and this will only benefit the sales department. It is also important to share this information with management.

Spend Time to Educate Everyone

Educating employees through both departments can help remind everyone that their jobs are supposed to be interactive. Credit and sales departments must be trained so they can recognize each other’s needs in establishing accounts. Credit employees should be encouraged to attend various sales meetings as well as provide presentations on different credit aspects and on alternate arrangements that can be worked out. 

Credit and sales internships should also be encouraged so that members from each of these departments can swap jobs for a short time to understand how the other functions and why the departments are both very important. Credit personnel should spend time on prospective calls while sales employees can make various credit calls. This exposure will provide each department with an understanding of the frustrations and challenges that they each face.

Maintaining A Positive Outlook

It is very common to be faced with challenges and opposition to credit or sales decision but employees should be counseled not to get angry or hostile even when faced with management overrides. Teach employees about various techniques that will help them defuse their anger before they respond to the decision. Simply walking away for a while to wait for their first reaction to subside and maintaining a cool composure is a great way to analyze any situation rationally and to work closely together with one another. Learn how not to take every criticism personally so that you can maintain an open mind and positive attitude to work out various problems and come up with solutions.

Encourage employees to be approachable and have a sense of humor so they can get their point across to the other department without being threatening or confrontational. While it may take quite some time to instill these qualities in employees working in both departments, it is very necessary for the success of the company.

Teamwork is the Winning Strategy

On the whole, the organization gets adversely affected when credit and sales are not cooperating with each other. The key here is teamwork. The two interdependent, vital functions should function in cooperation and agreement to create an environment which will get them better results and help the overall growth of the organization.

Customers only view the company as a whole and not as different departments. Having a motivated, informed and trained team will foster cooperation within departments.

Ferdi Nel

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