Weekly Blog by Philip King, CEO of the ICM - 'Supporting the Business in You'

A campaign was launched by David Cameron in Leeds on Monday. 'Business in You' is a partnership between private enterprise and Government to highlight support for start-ups and growing businesses and encourage entrepreneurial spirit in 2012. It will run throughout the year and I'm delighted to say the ICM is actively engaged as one of the initial supporting organisations.

The campaign aims to highlight the fact that many people are sitting on an idea that could become a business, and many businesses have the potential to grow whether that's by launching new products, entering new markets, exporting for the first time or more widely, or by accepting the challenge and going for growth despite the negative malaise that surrounds us. The campaign website can be viewed at: http://businessinyou.bis.gov.uk/

I was at a meeting at BIS with many other of the supporting organisations on Tuesday and there are some really inspiring case studies being shared, and some innovative support solutions being offered by organisations as diverse as the Forum of Private Business, CBI, Institute of Directors, British Bankers' Association, ACCA, ICAEW, Intuit, Microsoft, Paypal, and Mitie to name but a few. Interestingly this is less about a government campaign with private sector support, and more about a collaboration that brings together the best from both the public and private sectors. And encouragingly, this isn't a government short-term soundbite-style gimmick but a long-term activity lasting for the whole year with links into many events and propositions. So how does the Institute of Credit management fit into this?

One of the challenges for all businesses, and particularly for start-ups and growing organisations, is making sure they have enough cash to sustain the business and its requirements. Managing cash-flow is vital, and the over 275,000 downloads of the ICM's Managing Cashflow Guides are testament to how relevant the subject is, and what an appetite there is to gain the necessary skills to manage it better. I hope the 'Business in You' campaign succeeds in encouraging more entrepreneurs to create a start-up, and more businesses to successfully expand but if it also helps businesses to manage their finances better and therefore survive longer, then it will have delivered something really worthwhile. I am proud that the ICM is among its supporters.

Weekly Blog by Philip King, CEO of the ICM - 'Stating the obvious'

The Tribunals, Courts and Enforcement Act 2007 contained provisions for the regulation of bailiffs and followed a White Paper published in 2003. Since then, I have been to numerous meetings to discuss the issue and the Ministry of Justice has been repeatedly promising a consultation on detailed proposals for a new regulatory regime. When Justice Minister Jonathan Djanogly announced this week the release of updated 'National Standards for Enforcement Agents', he also promised that the Standards are 'the first step towards tackling this issue (unscrupulous bailiffs), which will be followed shortly by proposals for a new regulatory regime.' I'm heartened that at last something seems to be happening but, although I understand the consultation is expected in Spring, I'm always nervous when I see the use of words like 'shortly'. I remember the importance of SMART objectives being used in business and I sometimes wish the public sector would apply the principles by putting a specific and measurable date on actions rather than using vague descriptors like 'soon' and 'shortly'.

Anyway, back to the updated Standards. They can be found here but don't expect to be overwhelmed by their content. Creditors' responsibilities include, among other things, that they should be aware of their own responsibilities, must not seek payment in order to secure a contract, must notify the enforcement agent if the debtor pays or contacts them, and must forewarn the debtor of impending enforcement action. The section 'Professionalism and conduct of the enforcement agent' says they must act within the law at all times, must not be deceitful by misrepresentation, must not act in a threatening manner, should always produce relevant identification, must not discriminate, and a few other similar instructions.

In short, there is little in the Standards that any credit professional or enforcement agent couldn't have written on the back of an envelope if asked to suggest what they should be. As the document says, they are not legally binding, but offered as a 'helpful tool for the industry and for creditors.' As Colin Naylor, Co-Chairman of CIVEA (the Civil Enforcement Association) points out: "these are the Industry's own standards......all the signatories are already committed to the practices and standards contained in the document........and most CIVEA members already publish similar creeds of professional behaviour."

So will they have any effect on 'unscrupulous' bailiffs? I think not, and I wish the time and effort in producing them had been spent on drafting the long-promised proposals for a new regulatory regime so that the consultation can get under way and we can see some real progress.

Weekly Blog by Philip King, CEO of the ICM - 'Never underestimate the value of good credit management'

The Bank of England published its Credit Conditions Survey for quarter 4 of 2011 last week. In summary, it said that although lenders expected a small increase in overall credit availability in the coming three months, it will be impacted negatively by factors such as the economic outlook and tighter wholesale funding conditions. Furthermore, a key determinant of credit availability will be developments in the euro area and their impact on banks' funding conditions. It noted that demand was down across all areas but most significantly from small businesses where it fell sharply. I guess a succinct way of distilling the 17-page report down to a few words would be: a stagnant economy where lack of confidence is stifling demand to spend or invest, and where external factors could have a major effect!

I'm often reminded by our members - and I in turn remind government in meetings - that trade creditors lend more to businesses than the banks and - just as bank lending decisions impact on the ability of the economy to grow - so do the credit decisions of credit professionals. When they decline or accept an order or contract, they impact on the whole trade cycle for themselves, their customer, their customer's customer and so on either negatively or positively. That in turn impacts on the economy and its capacity to grow. In isolation of course, an individual transaction is probably not material, but cumulatively the impact is immense.

In my blog last week, I talked about showing and being proud of our professionalism - that professionalism is manifested in the decisions we reach throughout all credit management activity. Getting them right, whether we're dealing with multi-national corporations or individual consumers, is vitally important and we shouldn't underestimate the impact we have, not only on our own organisations but on the wider economic well-being.

Please click here to complete the ICM UK Credit Managers' Index - it only takes 2 minutes.

If you haven't already signed up to participate in the ICM UK Credit Managers' Index, please join the panel that commits to complete it quarterly and contribute to this influential and important industry benchmark. The results are widely publicised in the trade and financial press, and on the ICM website, and all participants will automatically receive access to the results and summary prior to general release.

Weekly Blog by Philip King, CEO of the ICM - 'Be careful what you wish for'

In a Financial Times survey of 83 economists (including 11 former members of the Bank of England's Monetary Policy Committee) earlier this week there was a consensus, by a majority of three to one, that the economic outlook in 2012 would deteriorate. It also showed that almost all of those expressing an opinion said the UK outlook would be much worse if the Euro collapsed. I can't say I'm surprised by the findings - I think we've all known for a while that this year is going to be tough and little better - if at all - than 2011.

I quoted Richard Tyler of the Telegraph in my blog on 1 December saying that we should all commit not to say Britain would have another recession on the basis that these things can become self-fulfilling. I'm not sure what impact our words have but I do know something of the positive impact credit professionals can have on their businesses and that is something we certainly should be talking about.

2012 is the year when we, as credit professionals, need to stand up and be counted. We need to make sure that our peers, colleagues, and Boards know and understand the contribution we can - and do - make. When a potential order is difficult to accept, we can engineer payment terms and security to make the unacceptable acceptable. When a coveted order is almost out of reach, payment terms used cleverly can make the unattainable attainable. When a situation with a debtor is looking like it could go horribly wrong, careful management and close contact can make the potentially irrecoverable recoverable.

Whatever sector and industry we work in, and whatever our role, we need to show our professionalism, be proud of our profession, and raise awareness of the significance of our contribution. Two practical steps we might take: firstly, calculate the cash-flow value of one day's sales to our businesses so we can talk about our contribution in terms of hard cash rather than the reduction of one day in DSO (the former is much more meaningful to the rest of the business). Secondly, we can show we are professionals and belong to an organisation representing our profession by wearing the new ICM badge. If you haven't got yours yet, simply send an email to members@icm.org.uk quoting your correct email address and saying how many people currently work in your credit department.

I'm not a great believer in New Year's resolutions but I do passionately believe in setting goals, and showing commitment to them by monitoring progress. For 2012, be proud of your professionalism, stand up and be counted, and don't be afraid to demonstrate your value.