Tip: The Six W's of Managing Up

There is a lot of information available about how a Credit Manager can best manage credit department staff. Another critical topic is how to manage up. The interaction and support you offer your manager when asking for help, or helping set your manager's expectations of you and your department, can be as important as managing down. That is where the following “Six W's” of managing up, come in.

If you do not meet with your manager periodically to discuss these “Six W's,” it is a good time to start.

1. What are your manager's priorities?

Your manager sees company operations and priorities from a different vantage point than you. A Treasurer or CFO must address what is important to other senior executives in areas such as Sales, Marketing, Operations, Payables, Procurement, the CEO/COO, and the Board of Directors. 

By understanding your manager's priorities, you can determine which metrics to track, and how best to deploy your staff. For example:

• The priority may be to gain market share or increase revenue. These require an emphasis on how your credit policy can be adapted to approve new business or increase credit lines. You will need options on the shelf to secure sales to risky customers. 
• If the priority is cash flow, then you may employ a more conservative credit policy, putting an emphasis on collections. 
• If maintaining customers and customer care is a priority, an efficient deductions management process may be in order.

Priorities will vary depending on the size of your company, your industry, and economic trends. The key is to stay tuned to what is important to your manager and the senior management team.

2. What does your manager need to know?

Everyone is busy these days. There is little time to wade through lengthy reports or repetitive updates on low-priority issues. Determine what your manager finds most important and focus your reports and communication upward on those issues.

Think of the key metrics that best illustrate your manager's priorities:

• Is it DSO performance? 
• Tracking past due balance trends? 
• A view into collection trends for a particular channel or customer in your AR portfolio?
• An early warning when there will be disruptions in shipments or cash flow? 
• Something impacting your company's customer service, particularly to sensitive accounts?

The critical point here is to craft how you report and communicate upward by including:

• The priority issues of interest.
• The financial impact.
• Who is assigned to address the issue, or collect the balance?
• When the closure is expected.
• When management help is needed.

3. When does your manager need to know?

This is where being proactive comes into play. There is no use in sending your manager a month-end report long after the month-end, or a dashboard showing past events where your manager is either blindsided, or it is too late to become involved. Month-end reports and dashboards must be timely, succinct, and of genuine interest to the reader. You should inform, and in some cases involve, your manager when issues arise that will materially affect results in their priority areas.

4. When should you seek help and guidance from management?

There are times when you need help from someone at a more senior level. It is much better to proactively seek out that help than to go it alone and report negative results after the fact. There can be tangible benefits:

• Your manager is likely to provide a useful perspective. 
• With your manager's help, you can cut through cross-functional delays. 
• By involving your manager, you have created a joint approach in which you both have ownership and responsibility.

5. Why you should remind your manager that you are a manager too.

As a manager you have a responsibility to your staff:

• Provide feedback to your manager when you are asked to deal with shifting or competing priorities that negatively affect your staff's efficiency and performance. 
• Get an agreement to avoid being interrupted by your boss when you are in an important meeting or a one-on-one with a staff member. Having your boss walk in or interrupt a virtual call, shows a lack of respect for your management responsibilities. 

6. Why your manager needs to know your staff and communicate directly with them.

Good communication up and down the line is of critical importance today for several reasons:

• An environment of increased remote work or staff locations can lead to communication delays or breakdowns. 
• If you are experiencing high turnover, it is increasingly difficult to maintain a department and company culture. 
• Having your manager meet with your department periodically provides them with an opportunity to communicate priorities directly, to know staff members, and listen to their issues and challenges.

Watch our course on Credit and Collections Career Development Tutorial to identify your strengths and development opportunities for career advancement.