By Prashant Ranjan, Sr. Business Analyst

1. Time management

The time factor is an essential and decisive element in the success of this mission. Indeed, there is a direct link between the time spent and the probability of recovery of a bill, whether for customer solvency issue or because administrative reasons (loss of information, change of contacts,…).

After 6 months of delay, only 50% of the receivables are recovered while the time and energy needed to try to obtain the payment is increased exponentially. For this, it is necessary to apply a collection strategy that includes a progressively in the actions performed.

2. Adapt to the customer’s organization.

Sending blind robotic reminders to a generic address (for example, mass mailing) has never been effective, and is less and less efficient. The search for the right contact(s) as well as the understanding of the internal customer-side invoice management process is essential.

Thus, the recovery action is oriented successively depending on the identified problem (a late payment = a problem) to the right person or department, who can unlock the situation, and move on to the next step. To be effective, the action, must be done at the right time, to the right person, with the right information

3. The quality of Accounts Receivable management on a daily basis.

Agree with your customer on the invoices to be paid if the customer account is not perfectly clear in your accounting system, updated day by day? Any discrepancy between customer accounting (AR) and supplier accounting (AP) leads to late payments, time lost on both sides to reconcile and loss of credibility towards the customer.

Debt collection is a matter of communication between two organizations (those of the seller and the buyer) that are not natively made to talk to each other. The natural divergent elements (information systems, corporate culture, management rules, … are different) are sufficiently numerous not to add a layer of accounting mismanagement.

The accounts receivable must be kept daily as soon as the payments are received. Any discrepancy must be fixed immediately in order not to allow a drift, rendering the accounts illegible and ultimately irreconcilable.

4. An excellent relationship

The quality of the relationship established with customers contacts is essential. The objective is to build a balanced relationship over the long term, just like the business relationship, both cordial and demanding (an iron fist in a velvet glove).

Conclusion:

It is not so simple to combine these four pillars, sometimes complex, often contradictory. This is a real art, done by the collector who, depending on the customer and the commercial situation, makes a careful mix so that the financial interactions between the two actors are fluent.

Those who do this help to solve problems and obtain payment of bills, improving the cash flow and profitability of their business, while contributing to the quality of the customer relationship.

By Clint Kordsmeier, VP of Sales

The past couple of years have presented business with many new challenges, but also reaffirmed certain truths that used to be easy to ignore.  One thing, however, is pretty clear:  implementing smart Order-to-Cash technology should be a key priority for all organizations.

Here are a few key O2C Trends that finance leaders are focusing on (or should be):

Making it easy for customers

Being “easy to do business with” has long been a goal of most companies, however, a smooth, streamlined experience is now just a minimum requirement for a business to attain, engage and retain customers. In the AR and collections space, this means a clear, easy process for customers to receive and understand their invoices and automated statements or reminders, oftentimes ahead of the due date. They also need a clear process for collaborating on inquiries or disputes.  Making it easy to pay is also crucial to ensuring customers pay on-time, every time.

Increased Visibility, Better Analytics

For finance leaders and business owners, having clarity over the account status and the collections process is extremely important. With greater visibility comes the opportunity to forecast with more accuracy, assess risk more thoroughly, and make data-driven decisions.  Ultimately, better oversight delivers a more holistic view of the performance of both operations and finances.

Digitalization & Automation

According to industry survey published earlier this year, 68% of CFOs are planning to increase their investment in digital transformation in the next 12 months. This shouldn’t be surprising given the payoffs that today’s modern finance solutions can deliver. Implementing an Order-to-Cash automation solution like Webcollect, has many advantages. Businesses that adopt O2C technology are able to improve efficiency and effectiveness by automating and/or eliminating certain tasks and leveraging insight and AI to prioritize higher-value activities.  Implementing this type of technology also allows companies to standardize processes, reduce human error and safeguard against unforseen operational challenges and economic risks.

Focus on employee satisfaction

The employment market is tight and much has been written about The Great Resignation. Work-life balance, mental health, and the ability to work from anywhere is now expected, and A/R departments that have implemented O2C platforms have found a way to thrive in this environment.  Retaining good staff is crucial for company efficiency and team effectiveness, and these solutions help reduce repetitive and mundane tasks for staff in order to increase productivity and job satisfaction.

 There’s never been a better, or more necessary time to evaluate your O2C processes and adopt a technology solution to help improve the efficiency and effectiveness of your entire O2C operation.  Solutions like Webcollect, the integrated O2C Pro Platform introduce unprecedented levels of flexibility, industrialization, and automation to deliver real value and keep all O2C stakeholders happy.

By Clint Kordsmeier, VP of Sales

For many A/R departments, Covid-19 has meant increased pressure to improve cash conversion and reduce DSO. As your organization looks to mitigate cashflow risk associated with disrupted supply chains, reduced sales, and other client challenges, you can help unlock working capital, quickly turning receivables into cash while improving the Customer Experience.

Here are the simple steps:

1. 1. Digitize, Automate, & Optimize Order-to-Cash Processes
   2. Leverage Intelligence for better/quicker decisioning
   3. Move upstream for problem avoidance
   4. Optimize the Customer Experience
   5. Choose the right technology partner

Digitize, Automate, & Optimize Order-to-Cash Processes – Improved metrics, reduced costs, data security and visibility can be obtained, but the focus must be on improving the overall customer experience and harnessing the collective power of human and technology synergies to optimize results. We are also dealing with unprecedented labor challenges related to working from home, the great resignation, and the rising costs of employment. These things have further amplified the need for automation, remote access to critical data, and a UX that keep employees happy.

Leverage Intelligence for better/quicker decisioning – GI Joe used to say: “Knowing is half the battle.” That was probably true when you were only able to report on past actions, react and respond accordingly to hopefully improve future results. However, with real-time analytics, AI, and Machine Learning, you can now harness the power of your data to manage O2C processes and outcomes proactively. These deep insights into problems and solutions allow you to properly quantify opportunities for improvement and enact policies that benefit your customers and your company.

Move upstream by implementing sound credit policies and billing improvements – Once you have your collections and dispute management processes in order, and are covering your entire portfolio, identifying, understanding, and quantifying issues and challenges. You can then turn your attention to solving challenges before they become problems, by implementing sound credit policies and improving billing accuracy.

Optimize the Customer Experience – In order to keep customers happy, you have to deliver a positive customer experience. A customer-centric O2C solution like Webcollect, can improve customer onboarding by streamlining the credit application, automating the review and decisioning process, and ensuring critical data is easily obtained, eliminating the frustration and back-and-forth time delay. You also want to look at the customer billing and payment experience where customers are now requiring more flexibility and additional options for receiving invoices and statements, collaborate on issues, and make payments based on their preferred methods, including click-to-pay and self-service.

Choose the right technology partner based on experience, flexibility, and support – Your customers are demanding options and flexibility, so should you. The O2C Technology you choose must be flexible and adaptable, easy to integrate into your ecosystem, and address your specific needs and challenges. The technology provider itself, must also be flexible, easy to work with, and a company with proven success that you can trust, during the sales cycle, the project implementation, and beyond. You must be diligent in your evaluation…ask them about their implementation and on-going support. What happens when you need additional training for new users, want to add new features, or maybe reduce your utilization.

While these steps are fairly simple, and certainly not earth-shattering, they are critical, today more than ever. With ongoing business risk due to the lingering pandemic, global supply chain uncertainty, new labor challenges, and rising interest rates, following these steps will allow you to thrive in the midst of this uncertainty. The O2C Pro team is ready to help…promoting that final step to the top of the list, should make the other steps not only simple, but easy.