Maximizing Effectiveness With A Dso Accounts Receivable Solution
Dso Accounts Receivable
As finance executive, you are likely familiar with the headaches associated with staying ahead of accounts receivable. Consistent monitoring and attention to detail is key in order to keep track of customer invoices and make sure payments are collected in timely fashion. Fortunately, implementing an innovative dso accounts receivable solution can give your business leg up when it comes to managing this side of the order-to-cash process.
When running the accounts receivable procedure manually, too much time is spent on invoice processing, issuing credits, and reconciling payments. With dso accounts receivable solution, business are able to streamline and accelerate the entire process, saving time and money, and improving the success rate of collecting payments. Managing accounts receivable with solution also provides alternative payment methods for customers and improved visibility into value for each invoice. Need your accounts receivable strategy to align with corporate goals? solution aids in integrating with analytics, compliance and digital signatures to ensure that company objectives are met.
The following guide will provide the necessary steps needed to begin using solution for dso accounts receivable.
Step 1: Identify Cues and Metrics
The first step to successfully utilize dso accounts receivable solution is to determine the KPI?s (Key Performance Indicators) and metrics your business would like to measure. Establishing data-driven benchmarks allows you to benchmark against industry averages to measure performance and identify areas of improvement. Common metrics and KPIs that can be tracked and managed with dso accounts receivable solution are Payment Terms and Agreement, Invoice Copy, Invoice Date, Invoice Aging, Invoice Total and Invoice Cycle Time.
Step 2: Analyze and Automate
After you have identified which metrics need to be tracked and measured, the next step is to analyze the data and institute an automated system. Automating the accounts receivable process is essential for business that want to speed up the recovery of payments. Automation can range from controlling the order-to-cash process, setting up standardized payment terms and conditions, or utilizing digital payments or digital invoices.
By automating this process the tedious task of manual monitoring and data entry of each invoice is eliminated and the workload is drastically reduced. For example, with an automated accounts receivable solution, business can easily assess if an invoice is paid in full or if customer has disputed and payment has been withheld. Automation also helps to monitor open invoice payments, warn customers before and remind them after the due date, and review customer activity and payment trends.
Step 3: Utilize Software
The last step is to select the right software (cloud-based or mobile) solution for your accounts receivable needs. There are many different Softwaresolutions available, so it is important to research the best option for your business. Consider the cost of the software, the resources required to maintain the software, and the type of data that the software will store.
For businessestarting out, cloud-based Softwaresolutions are good place to start as they are cheaper to maintain and can scale to meet the business needs. Mobile solutions are great for business that require more extensive solution with built-in features for tracking payments, resolving disputes, and automating payments.
Conclusion
When selecting dso accounts receivable solution, it is important to do research to make sure you are selecting the best option for your organization. With the right software, business are able to properly manage their order-to-cash process by implementing automated payment processing, setting up standardized payment terms and conditions, and accurately tracking customer invoices. When done correctly, business can save time and money, and achieve better success rates when it comes to collecting payments.
