Accounts Receivable Collection Process: Streamlining The Order To Cash Cycle
Accounts Receivable Collection Process
For any CFO or executive working in the financial realm, the collection process of accounts receivable is prime real estate for operational improvements. Reducing the days outstanding from customer, streamlining cash flow, and improving data accuracy can save both time and money for business. The challenge within the accounts receivable collection process is two-fold: conducting efficient interventions and, from the highest level, instituting an effective order to cash cycle. Though it can be accomplished without software, an integrated order to cash solution carries the potential to drastically reduce the cost and complexity of the collection process for CFOs and financial staff.
An order to cash solution can provide enterprises with holistic and consistent view of their invoice payment cycle. Companies will be able to more easily identify any irregularities in terms of customer payment, pricing, invoicing, and related data. In addition, the solution can provide insight into customer preferences and their payment behavior, while integrating seamlessly with financial and other core enterprise systems. With such comprehensive view and analysis in hand, CFOs can access deeper levels of information related to the business’ accounts receivable collection process. This is especially true when the solution has data transformation capabilities, automated workflows, and business intelligence suite.
Making the leap to an order to cash solution comes with its own set of challenges. The key for CFOs is to make sure that the new solution implementation does not interfere with the current accounts receivable collection process and the broader order to cash cycle. For companies that wish to preserve and refine their existing collection process without disrupting the flow, enlisting the support of an experienced partner is essential. The partner should be able to provide expert advice for configuring the solution to meet specific business needs and expectations, provide implementation assistance, and train financial personnel to use the integrated solution to its fullest.
The Steps to Implementing an Accounts Receivable Collection Process Solution
1. Set Priorities: Before any actual implementation takes place, the CFO should sit with financial staff to take an objective look at the existing collection process and identify any bottlenecks that an order to cash solution could help reduce. Compiling list of the biggest pain points can help to hone in the best tool that helps to resolve these issues.
2. Research Solutions: Once priorities have been identified, the CFO can start researching available order to cash solutions and evaluate their features and capabilities. At this stage, it is essential to ensure the solution is scalable, configurable, and has the ability to integrate with existing systems as desired.
3. Map Out Requirements: Before committing to any particular order to cash solution, the CFO and their team should map out plan for how the new order to cash process will work. This includes structuring the flow for invoice issuing, reconciling, and payments using the solution, as well as how the financial data and customer preferences will be used.
4. Find the Right Partner: Once the plan is mapped out and the CFO is certain of their desired solution, they should search for suitable partner to provide expertise regarding configuration and integration. This partner should have the capability to deliver customized, seamless solution that suits the specific needs of the order to cash process.
5. Train Staff: Once the solution is being implemented, the CFO will need to start educating their financial staff on utilizing the integrated solution for the collection process. Software vendors often provide substantial training programs to help foster seamless adaptation of the solution.
Conclusion
The accounts receivable collection process is an integral component of the order to cash cycle that carries the potential for huge cost and time savings when streamlining with an appropriate order to cash Softwaresolution. For financial executive seeking to maximize the benefits of such solution, it is essential to prioritize key requirements, select the right solution, find the perfect partner, and to ensure that proper staff training is conducted. Follow these measures and the transition to an efficient and effective order to cash process can bear rich fruit.
