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Discovering a bounty of opportunity in rough credit management seas

September 30, 2013 by Gary Stockton


In part three of our five-part voyage of the customer life cycle we discussed managing risk. This week we examine the strengths of ongoing comprehensive portfolio management to uncover hidden opportunity in your customer portfolio as we set off for the next port of call.


Buried treasure. The phrase conjures up vivid imagery. Gold, a priceless booty hidden on some distant reef, a submersible craft gliding up on an ancient undersea wreck laden with priceless artifacts. The hunt for buried treasure can really capture your imagination.

In turbulent economic conditions where the financial outlook can seemingly change overnight, credit managers can discover their own gold through preemptive loss mitigation; making ongoing account/portfolio management an active process throughout the customer lifecycle.

Our submersible craft in the voyage for greater profits comes in the form of more advanced portfolio management systems capable of diving to greater depths to survey for opportunity. Because credit situations with customers can change as rapidly as the weather at sea, credit managers are well advised to select a portfolio management system that allows them to instantly assess current information on a customer’s payment history and also provides a platform for incorporating other sources of third-party data. Having instant access to the right data can make all the difference.

Proactive portfolio management allows credit managers to not only prevents losses, but also identify new opportunities for up-selling existing customers.

As discussed in our previous post titled “Staying on course by effectively managing risk”, it’s also a good practice for the portfolio management system to incorporate risk-based triggers. For example, when customers are late with a payment or appear to be experiencing other signs of distress, credit management and collections teams must work closely together to interpret events correctly and make the appropriate decisions to secure repayment. Triggers provide them with continual updates on both potentially damaging and positive customer commercial activity, acting as an early warning system and enabling prompt action.

Finally, a good system also enables multiple users within an organization to review information efficiently, look at customer data through the right filter and assess each customer’s business condition on a case-by-case basis.

Staying shipshape:

Beware of relying solely on aging reports that may keep bigger problems hidden from view by having a full 360-degree view of each customer so that more informed decisions can be made.

From the logbook:

Experian’s clients have found that having actionable intelligence allows them to interpret data and risk correctly so they don’t overreact and decline potentially good business because of a simple servicing issue.

Ultimately, only by fully understanding each customer will credit managers have the confidence and flexibility to manage their portfolios, accurately gauge risk, and identify potential opportunities within their existing account base.

We always love to know what you’re thinking, so please send us your comments or questions below or send us a message on Twitter @experian_b2b.

For more information about Experian’s advanced business-to-business products and services, please visit www.experian.com/b2b.

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