What is the most serious error companies make in managing the credit function?
Answer: This is another tough
question. Companies often send mixed messages to the credit department. For
example, the company may expect the credit department to control DSO but
may give its sales department unilateral authority to offer extended date.
The credit manager may be evaluated based on his or her ability to limit
bad debt losses, yet the same credit manager may be criticized for holding
orders to force delinquent customers to address unpaid balances.