The Perils Of Passing Over An Order To Cash Software
AR DEDUCTIONS MANAGEMENT
Awareness of the importance of an efficient and effective order to cash (OTC) software continues to grow among Finance Executives as it has become major factor in achieving visibility and control of accounts receivable (AR) deductions. Without an OTC software, an organization risks being held captive to manual, time-consuming processes that have become outdated in this new normal business environment.
Remaining oblivious to the ever-evolving capabilities and advantages found in the OTC software gives financial and business professionals the false sense of security that they are in control and their operations are running smoothly. However, staying with the old methods of handling customer deductions through Excel spreadsheets and disjointed third-party systems can create long-term, long-term economic consequences.
The simplest Way to illustrate the risks involved in forgoing an OTC software is the concept of opportunity cost: time spent cranking out manual calculations and using disparate systems leads to huge losses in productivity. Also, scattered sources of customer data leads to difficulty in providing auditors with fast access to meaningful, accurate data points. Without reliable visibility and control into customer deductions, it is difficult to ensure that correct deductions are made, yielding misspent labor cost and inaccurate pricing, leading to larger missed deductions not caught.
Furthermore, with the recent trend in corporate negotiations in extended payment terms, organizations are missing out on the opportunity of collecting late deductions more quickly and in timely fashion, providing maximum working capital. Additionally, manual review of deductions results in lack of consistent analysis.
To avoid these potential surprises, Finance Executives must rely on an OTC software that integrates customer payment, deduction processing and resolution, payment terms, and collection cycles and processes into streamlined, comprehensive view. The software should have the capacity to automate and standardize deduction processes and provide real-time visibility into cash and deductions activity allowing for smarter decisions in managing deductions.
The risk of failing to deploy an OTC software is real, and Finance Executives need to fully understand that using the wrong solution could be detrimental to the organization. Choosing an OTC software should be strategic decision, and will prove to be beneficial to your organization in the long run. Not only does OTC software increase visibility and control of AR deductions, but also allows for quicker access to working capital and improved customer experience, resulting in more competitive pricing, more accurate deductions and more satisfied customers.
