Topic: Credit / Working Capital Management

Subject: Requesting Your Input on a Working Capital Management Survey
Bob Shultz
Member: 2002
Submitted on 10-11-17 4:43 pm

As we all know working capital and liquidity are the lifeblood of any company.  As the economy stabilizes and in some industries grows, with the potential for interest rate increases looming, we feel it is a good time to examine some of the best practices and priorities used by our FENG Membership “brain trust”.  We have developed the following Working Capital Management Survey as a mechanism to gather your thoughts and practices.

As a FENG member, you are by definition, a senior contributor to your discipline as a CFO, Controller, Treasurer, Credit Executive, or Lender, we can all learn from one another.  Please take the time complete this survey.  We will be compiling the submissions after October 30th 2017.  After that date, we will be compiling the results.  We will report back to those who completed the survey the valuable observations from your FENG colleagues.  

Please scan and send your completed survey directly to me at: [email protected]

Robert S. Shultz  Managing Partner, Cutting Edge Business Resources & Solutions (CEBRS)

Chairman FENG Credit and Working Capital Management SIG



Financial Executive Networking Group (FENG)

Working Capital Management Survey



Rate Your Current or Most Recent Employer

Rating Scale 1-5:  1= Strongly Disagree – 5 = Strongly Agree  N/A Not Applicable  Don’t Know

Cash to Cash Cycle Management and Coordination: (Rate 1-5)

¾    A process is in place to coordinate all stakeholders to manage cash inflows and outflows.  ____

¾    Processes and targets are in place to hold Managers accountable for cash results. In the areas of  Sales and Marketing, Order to Cash Management, Accounts Payable and Inventory Planning and Logistics.  ____

¾    A communication process is in place to ensure that product and marketing strategies are understood by all managers of departments affecting cash performance.  ____

¾    Product production and shipment delays are minimized through efficient Accounts Payable and Accounts Receivable management and coordination.  ____

¾    Sales, Credit, and Operations management work together to minimize “Hockey Stick” month, quarter and year ends that stretch account administration and impact delays in customer payments to terms.  ____

¾    Transparent and timely management reporting and or “real time” dashboards, are used to provide tracking to performance targets and easy visibility to root cause issues eroding results.  ____

Credit, Collections and Dispute Management: (Rate 1-5)

¾    A process is in place to ensure that customer onboarding and credit hold releases are quickly turned around, policy driven and results are transparent to key stakeholders.  ____

¾    Specialized working capital management software applications are used to replace manual effort and Excel Based tracking and reporting.  ____

¾    Customer credit review and approval workflow is managed using a specialized automated policy driven scoring model.  ____

¾    We can approve higher credit risk customers because we have “on the shelf” guarantee or collateral options to reduce our risk to an acceptable level as we increase revenue opportunities.  ____

¾    A process is in place to target, track and efficiently correct repetitive order input and invoice inaccuracies.  ____

¾    A documented credit policy is in place that considers the company’s risk tolerance and financial strategies. ____

¾    Automated collections tools, workflows and procedures are in place to drive on-time Accounts Receivable collections and cash performance.  ____

¾    The Credit and Collections functions work with Procurement to assess supply chain risk prior to a Supplier Agreement being finalized.  ____


Accounts Payable Management: (Rate 1-5)

¾    Accounts Payable practices are kept in line with overall cash objectives and ensure discounts and rebates obtained.

Treasury and Cash Management: (Rate 1-5)

¾    A process is in place to ensure precise cash forecasting to minimize the need for unnecessary borrowing.  ____

¾    The tools and process is in place to apply cash receipts effectively and accurately to the correct customer account and open invoice with minimal delays and cost.  ____

Management Target Priorities (Yes or No Response)

¾    Managers in Credit, Sales and Operations are targeted on cash to cash cycle performance.  ____

¾    Days Sales Outstanding is a target for both Credit and Sales.  ____

Our company targets:

¾    Accounts Payable Days Outstanding.

¾    Days Inventory Outstanding

¾    Accuracy to cash forecast

Obstacles Preventing Adoption of Working Capital Management “Best Practices” (Multiple Choice)

¾    Lack the budget for improvement initiatives.  ____

¾    Working capital is not seen as an issue by senior management. ____

¾    Our managers focus on their departmental objectives and targets.  ____

¾    We lack the systems and transparency to understand working capital management issues.  ____

¾    We have adopted the “best practice” solutions needed to meet our working capital needs.  ____

Describe Your Company: (This information will be kept anonymous)

1.       Revenue:

a.       > $50M __   b. $50M - $250M __   c.  $250M - $500M __   c.  $500 - $1B __   d. < $1B __

2.       Number of Employees

a.       > 100 __  b.  100 – 250 __   c.  250 – 500 __   d.  500 – 1000 __   e.  <1000 __

3.       Number of business units:  US: ___   Outside US __

4.       Sales Territory:  Domestic Only ___   Global ___

5.       Industry: _____________________________________________________________________

Comments: (Optional)



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