When it comes to accounts receivable, the average cost of collecting a single invoice can be significant considering the amount of a collector’s time and effort that goes into it. Further, any missing field, unattached document, or incorrect information can snowball into major payment delays, cash shortages, and bad debt write offs. If you dream of a more efficient, error-free, and streamlined accounts receivable management process, automation is your answer; but getting started doesn’t happen overnight. Here are three very important steps you must take to build a strong foundation for this project.
Study Your Current Processes & What Will Change: To make your case and choose the right solution, knowing where you stand today is an important first step. What does your current process look like and what are your biggest pains within them? Which of those processes need to be addressed first and what are your goals? What will change and what will stay the same?
All of these are important questions consider and begin to answer before you move any further. Here is one that many forget: What new steps will be added in? Make sure your team accounts for anything in the new automated process that you didn’t have to do before. In all of the excitement, some departments or teams may lose sight of the last part.
Get Approval: If the decision to automate accounts receivable is coming from a top executive, or if the executive team has had a hand in the automation initiative, then this can be the easiest step of all. If your executive team is not yet aware of your desire to automate, you need to do your homework. You’ll want to be able to put together a solid case for automation including the problems it will solve for the business, research on the benefits, total cost, and potential ROI of the investment. Here are a few resources to help you get started:
- Accounts receivable automation case studies
- Accounts receivable automation ROI calculator
- How to overcome common fears of automation
Choose Your Technology: What do you need in a system? What is the end results you want to see? There are many options available on the market. Some basic level automation will provide simple features, like emailing invoices, and others will allow you to automate reminders, credit management, and everything in between. That’s why it’s important to know what changes you want to see in your current processes and ultimately how you want to use automation for maximized ROI.
A part of that is understanding the features available in different solutions. In many cases, businesses have never implemented a system like this before, so knowing what is available to you is crucial in selecting a system that will help you reach your goals. It’s not just about buying a system, it’s about finding a good fit and a system that can adapt to your needs. We have an A/R Software Buyer’s Guide and RFP Template that outlines features found in leading solutions to help you through this process.
When it comes down to actually choosing your system and planning implementation, don’t get hung up on promises. Understand how you’re going to measure project success and what resources are required for implementation. It is your receivables process and your project. Make sure potential technology partners listen to your needs and do not push to change pieces that do not need fixing. Remain focused and keep the initial implementation simple. You can always implement more advanced features later.
Learn more about automating accounts receivable management and pick up a ton of helpful resources and research to help you build your case for making the change in our resource library. Click below to read case studies, access industry research and white papers, watch videos, and more.