Account Receivables – Risk Of Foregoing Automation
Automated Account Receivable Collection
Opting to downplay the implementation of automated Account Receivables (AR) into an Order to Cash (OTC) workflow affects competitive advantage and operational resilience by exposing the Accounting Department to variety of risks. An Order to Cash system integrated with an automated Account Receivables solution streamlines and standardizes the customer payment process, eliminating potential errors and improving the efficient collection of overdue invoices.
The fundamental purpose of AR automation is to retrieve payment from customers as quickly and efficiently as possible, avoiding overdue debt and maintaining an addressable client base. Uncollected payments increase expenses for company in the form of late fees, expenses charged as part of off-loading debt to third-party collection agency or legal fees. The effect of stalled or stagnant invoices prevents revenue from being generated, while the cost of debt incurs lack of customer trust, limiting revenue potential.
Preventative measures via automation effectively shield company from the expense of uncollected customer debt. Many business underestimate the cost of employing manual accounting processes, including the burden placed on Human Resources in the form of labor costs, training, and increased staffing. An automated AR workflow helps business avoid the costs associated with accounts receivable associated errors and missed data entry, as well as protecting against erroneous payment collection while improving the integrity of customer data.
The utilization of automation in Accounts Receivables delivers enhanced customer engagement through improved customerservice. Customer inquiries are handled in timely and efficient manner using an automated process, which bolsters customersatisfaction and loyalty. Increased visibility into invoices, the billing process, and the capabilities to track correspondence and customer payment history develops customer compliance and fosters an environment of customer trust.
Automated OTC systems provide meaningful and real-time insights into vital business functions such as accounts receivable, helping to identify bottlenecks in the billing process and the impact of late payments on the customer base. This helps identify weak links, improve efficiency, and optimize the business process. Increased visibility provides the data necessary to measure the success of Accounts Receivables and implement successful debt collection strategy.
Eliminating risk from the AR process and improving business visibility enables financial executives to hone their focus on other areas of the business. reliable automated Accounts Receivables process helps to maximize revenue potential, maintain customersatisfaction, and ensure the financial health of the company. Ultimately, the implementation of automation into the Accounts Receivables workflow is vital for any business that wants to ensure it conserves its competitive advantage.
