The Power of the Network

Highlights of the 2018 Credit Expo

For the 2018 edition of the Credit Expo, the scene was set at Dock’s Dome in the center of Brussels. The location was perfectly suited for the gathering of all credit enthusiasts from Belgium and beyond. As a platinum sponsor, TriFinance hosted the Expo for the third consecutive year in cooperation with Onguard, a TriFinance partner. CFO Services’ Cristof Van Laer discussed intermediary results of the Credit Management Survey TriFinance is conducting to map the Credit function.

Article by project consultants Michiel De Weerdt, Thomas van Onsem and Dieter Verbeek

Expositions offer great opportunities for both exhibitors and visitors to exchange new insights and ideas. At the Credit Expo, finance and credit professionals are able to discuss the latest trends, opportunities and threats shaping the credit management playing field. The Credit Expo, however, definitely wants to move beyond ‘credit boundaries’. As credit management affects the entire Order-to-Cash process, stakeholders across different departments and even industries are involved, making the Credit Expo a great networking platform for business and finance experts to exchange knowledge and expertise.

Software to rule the credit management department?

A visible trend at this year’s Credit Expo was the rise of software applications focusing on the role of credit management. As credit management becomes a more important strategic partner to the C-level, many (new) software providers are finding their way into the field.

Credit tools are not only necessary to support the processes of credit risk and collection, but also to gain insights into the activities, bottlenecks and opportunities of the credit department, contributing to the transparency of the function’s activities. Consequently, stakeholders will be able to make more informed decisions and act vigilantly when spotting significant developments.

Nevertheless, a software application can only be as effective as the underlying processes it facilitates. In order to find a desirable solution, companies have to keep in mind that a keen understanding of the current processes, roles and responsibilities is crucial. Analyzing these key aspects will not only give them powerful insights, they will also be able to optimize the current (credit management) processes. In an ideal world, the optimal credit tool will be selected based upon these enhanced processes, resulting in an optimal solution elevating the credit department to a higher level.

Credit Management Innovation Award 2018

For the first time in the history of the Credit Expo, the ‘Instituut voor Krediet Management’ (IVKM) handed out the Credit Management Innovation Award to one of four parties, nominated by the community, that are considered innovative pioneers in the field of credit management. Those nominees were: Intolaw, Triple A Solutions, La-On Lawyers and 10FORIT. The award was handed out by the chairman of the IVKM, Professor Ludo Theunissen.

After introducing the nominees’ innovations, Mr. Theunissen presented the Credit Management Innovation Award to La-On Lawyers. The recipe for La-On’s victory was the development of an algorithm for predicting the success ratio of subpoenas in case of non-payments. An innovation the community clearly regarded as a technological breakthrough with significant impact on the credit department across industries.

Credit management survey: first result surprises

Like the previous years, TriFinance hosted an expert session, with CFO Services’ Cristof Van Laer discussing the first results of the TriFinance Credit Management survey. The survey aims to map the structure and functionalities of the Credit Management function across organisations and industries. If you are involved in Credit Management, you can still take the survey. It will remain open until November 15th. Participants will receive an executive summary. Results will be presented during a live session in the first weeks of 2019.

Here are a few trends that become visible in the first results:

  • People
    • Only a mere 30 percent of organizations defined a credit manager role in their organization
  • Process
    • Lack of consistency: 77 percent of the respondents have defined a credit policy of which only 50 percent strictly apply it in daily business.
    • Lack of transparency: 46 percent of the respondents indicate there is no clear definition of roles and responsibilities in their credit policy.
    • 60 percent of new customers is brought in by Sales.
    • Only 40 percent of the respondents screen new customers, while only half of them reviews customers at least once a year.
  • Technology
    • 50 percent considers implementing a (new) credit management tool.

Getting the basics rights

The survey showed the importance of getting the basics right (people, processes & technology).Having a clear understanding of one's credit processes can give the company an edge on its competitors. In a time where the impact of emerging and possibly disrupting new technologies is uncertain, companies better be prepared. Understanding the most common problems during the implementation of a credit management tool (miscommunication between stakeholders, insufficient training, lack of follow-up, technical issues, etc.) leads to a growing awareness within companies that detailed process design is crucial leading up to the implementation phase.

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Cristof Van Laer Expert Practice Leader Credit Management
+32 2 895 55 45