An Exploration Of Unseen Risk: The Cost Of Not Using Automated Cash APplication Software
Automated Cash Application In Order To Cash
The automation of payments and cash application is increasingly becoming must-have for organizations all over the world. As result, the adoption of modern order-to-cash solutions have been on steady rise, with many business across sectors investing in such solutions to bridge the gap between manual and fully automated systems.
However, the decision not to invest in the use of such automated cash application software can be costly mistake. Many finance executives face an unrelenting pressure to reduce overhead costs, and some may be tempted to forgo this investment. But the risks and consequences associated with foregoing such solutions may be greater than anticipated.
Lack of automation can lead to longer average collection periods, leaving business without cash flow to operate and making traditional accounts receivable managers and sales more expensive. The high cost to finance of manual processing and deriving labor costs such as chasing payments, monitoring performance of accounts receivable, and implementing outdated and easily neglected processes can have long-term effect on business overall financial liquidity and haphazardly maintained customer relations.
In business-to-business payments and collection, automated cash application software can offer number of advantages that extend beyond cost savings. Not only does it istreamline manual processes such as keying data, but it isimplifies and accelerates matching, and provides more accurate and timely information on accounts receivable. Automated solutions are also able to provide detailed reporting, which helps finance executives to identify bottlenecks and areas of inefficiency quickly and anticipate where they can make improvements with greater accuracy.
Organizations that are looking to maximize their approach to budgeting and risk management should also consider the degree to which they are using automated cash application software. Without the right solutions in place, organizations limit their potential to recognize new and unknown opportunities associated with collecting payments faster, as well as reduce labor costs.
When it comes to automated cash application, organizations must consider the real cost of not investing in the right solutions. Without it, the true cost of manual processing can be difficult to estimate, but it can include missed savings from automating and streamlining accounts receivable, increased costs from labor shortages, failed customerservice due to limited visibility, and costly staff misallocations resulting from inaccurate accounts receivable reporting.
Therefore, finance executives should look beyond the cost of investing in automated cash application software and consider the unseen risk that accompanies not investing in such new breed of resources. By investing in high-quality order-to-cash solutions with strong automation capability, organizations open up an array of options to increase operational efficiencies, prevent costly errors and inaccuracies, and improve the customer experience. Thoughtful adoption of the right solutions can be game-changer for organizations, save them unanticipated sums of money, and ultimately, provide tangible return on investment.
