1405, 2018

Strategies for Optimizing Your Accounts Receivable (Updated for 2018)

By |May 14th, 2018|Categories: Blog|Comments Off on Strategies for Optimizing Your Accounts Receivable (Updated for 2018)

While customer-centricity, disruption and innovation continue to be keynote themes at conferences this year, teams across North America continue to power their day to day operations with the same tools and approaches they were using when the Y2K bug was dominating headlines. Today, I’d like to share some inspiration with you around the topic of optimizing your accounts receivable process, with a focus on the shift in mindset that leading companies are adopting as they prepare their teams to drive an exponentially greater impact on DSO and working capital through 2018 and beyond. Across industries, leading AR teams are prioritizing the delivery of great experiences, an emphasis on the importance of the customer relationships, and a shift towards working in real-time. Let’s unpack each of those in a bit more detail. 1. Deliver Great Experiences The reality is that the benchmark for great experiences is not being set by B2B organizations today - it’s being set by the B2C brands that have recognized that digital platforms are a primary interface with their customer base, and continue to iterate on ways to create frictionless interactions for their customers. While the accounts receivable process continues to heavily rely on offline touchpoints (printed Read More

905, 2018

5 Reasons To Take A Holistic Approach To Your Accounts Receivable Process

By |May 9th, 2018|Categories: Blog|Comments Off on 5 Reasons To Take A Holistic Approach To Your Accounts Receivable Process

I recently attended a convention keynote where the presenter spoke to the impact the Fourth Industrial Revolution on all aspects of business. This Fourth builds on the digital revolution, with the fusion of emerging technologies that are growing at an exponential rate. It is disruptive, especially with the recent focus on RPA and AI, with automation leading the charge in all aspects of our lives, professionally and personally. Yet when we think of one of the most fundamental areas of finance, Accounts Receivable, we still see AR teams taking a traditional approach, full of manual processes, disjointed practices, and segmented core functions, such as presentment, collections and payments. So how do these AR teams catch up, scale, and maybe even get ahead of the curve? It’s simple - they need to take a holistic approach to their AR process. Most AR departments only solve half of the receivables problem with their current resources. Here are 5 reasons that you need to take a holistic approach to the AR process: 1. Improving the efficiency of your invoice-to-cash cycle will get you paid faster. As an AR team, DSO is likely one of your strongest - and most feared - metrics. When Read More

2504, 2018

Low Cost Money Taking A Toll On Corporate Finances

By |April 25th, 2018|Categories: Blog|0 Comments

The High Cost of Low Interest is the title of The Hackett Group’s US Working Capital Survey. The survey is available here. The survey is free to download, but registration is required. Hackett’s 2017 survey will be available later this year. James Daly, CEO of Euler Hermes Americas, published an article in based on the earlier survey. Since we know that the Fed’s intent is to keep raising interest rates, left unchecked current practices are going to grow increasingly costly. Both the survey and the CFO article are worth reading. The survey’s conclusion is that “lax working capital management habits learned in easy credit years are starting to take a toll.” The survey calculates working capital based on the latest publicly available annual financial statements of the 1,000 largest listed non-financial companies in the United States, according to statistics gathered by FactSet. The study reveals that in 2016, the 1,000 US companies borrowed another $413 billion, adding 9.3% to their overall debt level, even though cash on hand stayed essentially the same (up 0.4%). These 1,000 companies are $4.86 trillion in debt, more than double their level of indebtedness in 2008. The study notes “that might not seem too Read More

2802, 2018

The Future of Operational Finance

By |February 28th, 2018|Categories: Blog|0 Comments

A recent promotional piece from Deloitte describes how Operational Finance should be the epicenter of upheaval. But Deloitte’s experiences with companies around the world leads it to believe that most companies are “sleepwalking” into this future of inevitability – with nearly 50% of the time currently still being spent on data extraction and modelling, leaving precious little time to support decision-making and change management. Deloitte’s cross- industry benchmarks indicate that more than 60% of the time spent within the entire Finance function is spent on operational Finance activities. Many of these activities are still manual, where the median performer: Processes 23% of accounts payable vendor invoices automatically Processes 59% of accounts receivable customer remittances automatically Has automated 19% of total key controls   Sound familiar? Deloitte says each organization should ask where it sits on the evolutionary spectrum. Today, the role of the CFO is under greater scrutiny, internally and externally, and faces never-ending pressure to cut costs, grow revenue and ensure control. Economic uncertainty, increased regulatory requirements, financial restatements and increased investor scrutiny have forced them into the spotlight. It’s not surprising that CFO turnover is on the rise. Deloitte has advice: Establish the strategic direction to understand the Read More

612, 2017

3 Secrets You Didn’t Know About Accelerating Collections

By |December 6th, 2017|Categories: Blog, Collect Smarter|0 Comments

When it comes to the invoice-to-cash process, the most common pain point next to cash application is collections management. If you’re in finance you can relate to the manual steps, time-consuming efforts, and constant back and forth with customers... all while your receivables continue to rise. The collections frenzy is all too real in organizations today. Collections teams are in a sense firefighters: they put out raging fires, respond to collections crises and rescue the cash they’re owed from bad debt. Once they’ve put out one fire, it’s off to the next one burning down the street. A common trend for most organizations is to fix this issue by adding headcount, this, however, is a temporary fix. Not only do collections continue to rise, but also the number of people needed to manage it. The result? More overdue accounts, handled by a growing collections team. This situation is not fiscally sustainable. So how can you better manage the collections challenge? First, we must recognize the nature of collections: traditional, reactive and lack of real-time insight. In a manual process, collections data represents a static point of time (ERP reports, XLS sheets), narrowing your team’s view of overdue accounts to a rear-view Read More

1911, 2017

The Deloitte Working Capital Series

By |November 19th, 2017|Categories: Blog, Save Time and Money|0 Comments

Deloitte has published its Working Capital Series, that includes Strategies for Optimizing Your Accounts Receivable; Strategies for Optimizing your Accounts Payable; Cash Management; and Strategies for Optimizing Your Inventory (read report here). I enjoyed the Strategies for Optimizing Your Accounts Receivable. It is a short and worthwhile read. The series argues that given the cost of new capital, no business can afford to let its existing capital go to waste. However, often a business doesn’t realize how much cash is trapped on its own balance sheet. Freeing up that cash – by optimizing its working capital – delivers more than improved operational efficiency. It also gives a company the added liquidity it needs to fund growth, reduce debt levels, lower costs, maximize shareholder returns and even outperform its competitors. The article notes that most businesses have AR policies that dictate when to bill, how much to bill and when to collect. Unfortunately, not all businesses enforce those policies effectively – or even adopt the right processes at all. In many cases, it comes down to culture. A business that prioritizes sales often falls into the trap of extending credit to customers, offering discounts or ignoring payment terms if it means Read More

2709, 2017

Why Financial Institutions Are Banking on Integrated Receivables

By |September 27th, 2017|Categories: Blog, Gain Insight Into AR, Make Customers Happy|0 Comments

Are you behind on your Integrated Receivables Strategy? An integrated receivables hub is needed more than ever to future-proof business and banks are taking notice. But this wasn’t always the case. Three years ago, integrated receivables management was beginning to surface on the radar of banks, but most didn’t take action. According to Celent’s 2014 survey of US large banks, 92% rated integrated receivables (IR) management as most important to their future growth. But according to Treasury Strategies, only 1% fully implemented a solution. Why? Banks accepted the notion of integrated receivables but hesitated because of lack of control and high costs. To add to this, lockbox technology - a great revenue source - was greatly improving at the time. Optical character recognition technology (OCR) eliminated the need for banks to manually keystroke remittance information. This allowed them to seed more accurate data, reduce paper and process remittance information faster. But even in light of this advancement, today one foundational problem still exists - payment information is siloed in disconnected systems and in different remittance formats. This makes reconciliation and cash application inefficient both today and in the immediate future. According to Aite Group research, 60% of corporations are not Read More

109, 2017

Improving the B2B Customer Experience

By |September 1st, 2017|Categories: Blog, Make Customers Happy|0 Comments

An article published by McKinsey correctly argues that adopting a customer-centric mindset is just as critical in B2B dealings as it is when serving retail customers. The article, Improving the Business-to-Business Customer Experience says that more and more executives are developing B2B customer-experience strategies with striking results. McKinsey says that B2B customer-experience index ratings significantly lag behind those of retail customers. “B2C companies typically score in the 65 to 85 percent range, while B2B companies average less than 50 percent. This gap will become even more apparent as B2B customer expectations rise.” Driving these expectations are digitization and the increased use of smartphones. This is establishing new standards for fast, seamless customer service in all settings. “Real-time responsiveness and easy-to-use apps for daily banking chores or ordering groceries are setting a high bar for speed and ease of doing business in B2C industries, and these expectations are migrating to B2B.” McKinsey says that digitizing the customer experience is a lever often left unused by B2B companies. “There is great potential in the B2B realm in using concepts such as self-service, online interfaces, and automated decision rules. For example, the use of digital “track and trace” interfaces enables B2B clients to Read More

1508, 2017

FinTech for Commercial Real Estate? Here’s 12 Reasons Why.

By |August 15th, 2017|Categories: Blog, Collect Smarter, Gain Insight Into AR, Get Paid Faster|Tags: , , , , |0 Comments

According to KPMG, this year in Q1 2017 global investment in FinTech companies hit $3.2 billion across 260 deals… and this is just the beginning. The way the internet changed publishing and music, FinTech is now changing industries like commercial real-estate (CRE) by modernizing the old-school processes used by finance. It’s no secret that collecting receivables for CRE companies is a challenge and managing multiple tenants can be frustrating. Without an effective platform to communicate rent charges, CAM fees, and tax across multiple locations and divisions, cash flow can be stifled with no real insight. FinTech is the answer for today’s CFOs and Property Accountants who need innovative technology to meet the digital appetite of customers, improve their experience, streamline processes, and access real-time data to make real-time decisions. A financial technology gaining traction with CRE companies is tenant platforms powered by accounts receivable (A/R) automation. With the ability to manage all tenant rental charges, payments and collections in a cloud-based platform, AR automation eliminates manual processes to save time (reconciling payments, reissuing invoices, chasing down tenants’ sales numbers) and refocuses efforts on high-value activities like tenant experience. Take Brixmor Property Group for example. They needed to improve communication with Read More

3107, 2017

Need a competitive advantage? Try a digital transformation

By |July 31st, 2017|Categories: Blog, Gain Insight Into AR, Save Time and Money|Tags: , , , , |0 Comments

Competition is the frenemy of every business - it’s a sign your offering is valuable to the market but it creates pressure to keep the customers you already have and find new ones quickly before the competition does. With digital on the rise, there is an opportunity for companies to get ahead-of-the-curve and champion digital transformation as a competitive advantage. How big is this opportunity? A Frost & Sullivan report projects that U.S. B2B e-commerce sales will reach $1.9 trillion by 2020, as global B2B online sales will reach $6.7 trillion. This is a lot of business to leave on the table for your competitors if you put off your company’s digital transformation. An undeniable way to make customers stickier is to allow them to conduct business with you, the way they want to. What does this mean in B2B? Adapting to their purchase behavior which is trending online and offering flexible payment types. This is where a digital transformation of your accounts receivable process including adopting an electronic invoice payment and presentment (EIPP) platform comes into play. Even though paper checks continue to reign over the supplier payment space, according to a 2016 Payments Fraud Survey, 71% of companies Read More

1506, 2017

The Great ReWrite: Leverage It Or Lament

By |June 15th, 2017|Categories: Blog, Uncategorized|0 Comments

I recently had the pleasure of listening to business and technology visionary Leonard Brody at the Gartner CIO Summit. What a fascinating session. He is an award-winning entrepreneur, venture capitalist, bestselling author, and two-time Emmy-nominated media visionary. Brody is now a partner with Creative Artists Agency among other interests. He was previously Co-CEO and a Director of NowPublic which was one of the pioneers in citizen journalism and quickly became one of the largest news agencies in the world. He is also a Venture Capitalist and acts as an advisor to venture capital funds in the US, Europe and Asia. So when Brody spoke, I listened. He has one over-riding message: Move away from the idea of a singular innovation … and toward the idea of The Great ReWrite … it is what we are living right now, in real-time. Everything is undergoing dramatic transformation … individuals and companies have to be part of it, even create it or be lost in it’s wake. Technology advancing at lightning speed underlies all of this. Brody knows all of this first-hand. His uncle was the late Izzy Asper, who once controlled the CanWest media company with more than $6 billion in revenue, Read More

2305, 2017

The creative destruction of accounts receivable

By |May 23rd, 2017|Categories: Blog, Get Paid Faster, Make Customers Happy|0 Comments

When Joseph Schumpeter coined the expression "creative destruction" in 1942, he had no idea how creative the marketplace would become and how swift the destruction would be. Today’s corporate world, already in unprecedented turmoil, will only get stormier. According to a report released last spring, half of S&P 500 companies are expected to be replaced over the next ten years. The report, entitled Corporate Longevity: Turbulence Ahead for Large Organizations, was developed by the global consulting firm Innosight*. The company’s analysis of S&P shows that the 33-year average tenure of companies on the S&P 500 in 1965 narrowed to 20 years in 1990 and is forecasted to shrink to 14 years by 2026. We are seeing record M&A activity and the growth of startups with multi-billion dollar valuations. These are just two indicators that a period of relative stability is ending and that an increasing number of executive suites will lose control of their firm’s future. Most of Schumpeter’s destruction is caused by new technologies and the innovative ways companies are bringing their goods and services to market. What was leading-edge ten years ago will likely be out of date tomorrow. Products, approaches, procedures and business processes that have worked Read More

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