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Outsourced Credit Management: A study of the rationale, impact, and success factors

Cromwell, Sonia (2020) Outsourced Credit Management: A study of the rationale, impact, and success factors. Masters thesis, Dublin, National College of Ireland.

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Abstract

Credit management has a significant impact on organisations liquidity. A vital element of effective working capital management is the management of trade debtors, ineffective credit management can result in low liquidity and significantly impact an organisations cashflow. Where organisations have high levels of accounts receivable, there is a risk of insufficient cash made available to operate the business. The importance of Credit Management can often slide into the rear mirror view of businesses catapulted back again to the forefront in times of economic turbulence. Given the relevance of effective Credit Management, it is surprising on an investigation; there is very little research (Guilding and Lamminmaki, 2004) carried out on credit management and even less so on outsourced credit management.

The purpose of this research was to perform an in-depth analysis of outsourced credit management The research aims to identify the key motives organisations implement outsourced credit management strategies. The study objective was to identify the key impacts of outsourced credit management on organisations reputation, customer relationships and staff. A further objective was to identify key factors which attribute to successful outsourced credit management.

The methodology used for the research was qualitative research, semi-structured interviews of eight participants occurred. Participants worked within Credit Management and were selected based on their knowledge and experience within the profession.

The key results underline organisations outsource Credit Management for several reasons other than cost. Utilizing outsource providers expertise, allowing organisations to focus on core functions, process enhancements and advanced technologies, staff attrition are all considerations of outsourced collections. The research confirmed outsourced credit management can impact an organisations reputation, customer relationships and staff, while management are key to minimising impacts. The final findings outlined critical factors to achieving successful outsourced credit management are strong partnership relationships, trust between both parties, leveraging of technology and technology advancements, while communications and transparency between both parties is required to be consistently fluid.

Item Type: Thesis (Masters)
Subjects: H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management
H Social Sciences > HD Industries. Land use. Labor > HD28 Management. Industrial Management > Management Outsourcing
Divisions: School of Business > Master of Science in Management
Depositing User: Dan English
Date Deposited: 04 Feb 2021 12:37
Last Modified: 04 Feb 2021 12:37
URI: http://norma.ncirl.ie/id/eprint/4657

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