Five Ways to Take Control of your Invoice-to-Cash Process – guest blog by Data Interconnect
23 January 2020.
Data Interconnect recently undertook a survey with CCR Magazine of 100 credit management leaders at major UK companies. It aimed to understand how the industry’s Invoice-to-Cash (I2C) processes are moving forward. We found significant challenges with every part of the I2C process – from onboarding customers, invoice delivery and dispute resolution to risk management, collections and cash allocation. If you are struggling to take control of your I2C processes, then these five tips may help!
Costs, budgets and IT resources were identified as barriers to introducing an invoice to cash automation solution within the finance department with 60% expressing concern over a lack of IT resource and 68% citing budget issues. You can address these concerns by choosing a SaaS based solution delivered via the cloud which reduces up-front Capex expenses and requires minimal input from IT departments. I2C solutions are very cost effective and their impact on DSO and Cashflow as well as reducing costs and risks means they typically pay for themselves.
When asked what would drive investment in – and have the most positive impact upon – I2C processes, automation was a clear winner in both categories (68% and 57% respectively). Automating manual processes frees up staff time to focus on more value-added activities.
Cross-departmental collaboration was cited as the biggest challenge to improving AR cash-collection efficiency by 56% of those spoken to. Replacing piecemeal systems with a single solution that spans the entire I2C process is the quickest way of resolving this.
62% of respondents reported integration as a key feature for driving investment in I2C process automation. Choosing a solution that has a scalable and integrated end-to-end approach across billings, collections, dispute resolution and allocation will enable your organisation to grow its credit management capability and excellence over time. By contrast, solutions that are not integrated in this way will subsequently add to IT costs.
Given the importance of cashflow to companies of all sizes, it was extraordinary to hear that half of those we interviewed said that getting the buy-in of senior management was a significant challenge in improving AR cash collection efficiency. It seems that, even though the smooth running of the Finance department is crucial to the overall success of any company, executives simply don’t have sufficient visibility of the problems that exist within it. It’s clear that Finance and senior leadership need to talk – and that Credit managers need to escalate the need for automation within their organisation.
If you would like to find out more about the problems that the Finance Department are facing when it comes to progressing its I2C processes, then download our Guide on Taking Control of the Invoice-to-cash process.