One to Watch Winner: Microsoft

Published: Jul 2017


Photo of Neil Doyle and José Luis Martí, Microsoft.


The practice of assigning credit limits to customers is not new or unique, however, to implement such a solution in a short period of time (18 months) and to transition c.13,000 customers from an indirect search model via a revenue share agreement with Yahoo to become direct advertisers spending on the Bing Ads platform was an incredible accomplishment.

Neil Doyle

Credit Manager Online Credit Services

Founded in 1975, Microsoft is the worldwide leader in software, services and solutions that help people and businesses realise their full potential.

Credit limit solution creates opportunity for Microsoft to challenge Google dominance

The challenge

Search advertising is a very important part of the Microsoft vision in terms of revenue growth and an enabler for the continued expansion of the Microsoft Cloud Business, and aligned with the recent purchase of LinkedIn, it has the potential to create exciting synergies. This places Microsoft in a prime positon to challenge the dominance of Google search and at the same time increase revenue, profits and market share.

Credit Limit Enablement (CLE) is a way for Microsoft to assign a credit limit for all advertising customers who opt for invoice (post-pay) as the method of payment and enforce that credit decision. Historically advertising customers did not have a credit limit assigned and even if they did they could continue spending above this amount, with no limitation and no early warning system in place to identify spikes in usage (possible fraud) and enable pro-active engagement with the customer/partner to ensure the usage is correct. This was also identified as a big compliance issue and a serious gap in their processes.

We in MSFT feel honored to receive awards as we believe they are a reflection of the great work our teams do on a daily basis, however, we feel the Adam Smith Awards represent the very best of Treasury and to be winners in such a talented field makes this award even more special.

Neil Doyle, Credit Manager explains, “The CLE process was not just put in place to close a compliance gap and to minimise risks, the vision was to be in a position to enable business growth by allowing operations to scale faster and more cost-effectively through technology, process and policy improvements.”

The solution

Microsoft engineering teams built a new platform (Bing Ads User Interface) for customers to manage campaigns and spend with Microsoft. At the front-end, teams in WOCS (Worldwide Online Credit Services) on-board customers and assign a credit limit for every customer based on their forecasted spend and risk profile. The engineering team built in functionality to track customer spend on an hourly basis and make this visible to both customer and Microsoft internal teams. The functionality allows the customer to spend up to their assigned credit limit and no more. The system also provides automated updates to customers and sales staff as they hit agreed spend thresholds, percentile wise.

Best practice and innovation

To take advantage of this technology WOCS had to adapt their processes to ensure customers who are genuinely increasing the spend with Microsoft did not go offline by hitting their credit limit, so they put in place a proactive daily review of each customer who spends an agreed percentage of the credit limit. At present the WOCS team are reviewing the credit limits proactively and increasing them when the customer’s usage is continually increasing, however, the functionality to automatically increase credit limits by using an algorithm is currently in development and it is expected to be launched in July 2017. The functionality will provide a periodical review of the customer’s payment performance and revenue patterns, if the patterns are showing revenue growth the system then performs an automated background credit check on the customer and the credit limit will be automatically be increased to match the customer spend and the risk profile.

Doyle concludes, “The next evolution of this solution to automate the reviews and assign increased credit limits to match customer spend and risk profile, will be truly revolutionary and I don’t believe any other provider will have this functionality.”

Key benefits

  • Revenue increase:

    Pro-actively increasing credit limits from circa US$8bn to circa US$11bn in the last 12 months.

  • Bad debt reduction:

    Estimate savings of circa US$2m over the past 12 months in comparison to prior year performance.

  • Time savings:

    Significant customer and sales visibility of customer spend vs credit limit assigned.

Key learning points

Having the right people from all stakeholder groups bought in at the initial stage is key. Listening to all viewpoints and being willing to accept changes that impact on your vision of the overall outcome of the project.

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