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In this blog, we cover 7 accounts receivable goals every AR team should look to achieve to ensure success in the coming years, alongside the technologies that'll help you achieve them.
Setting effective accounts receivable goals and objectives is critical to accelerating cash flow. And digitally transforming your AR processes to both automate and make them more human is crucial to achieve some loftier objectives—like retaining top-tier accounting talent, for example.
AR teams who rely on manual processes, however, will encounter roadblocks and impediments to growth. It’s unlikely that these teams will achieve their long-term accounts receivable collection goals or fully realize their function’s potential. Conversely, those who embrace automation—and recognize that goals should contribute to building engaging customer experiences—will enjoy more sustainable cash flow and heightened customer lifetime values.
But automating your accounts receivable should not be a goal unto itself. And that’s because the AR function has implications beyond just facilitating revenue and should be seen as a key touchpoint in your overall customer experience. Instead, automation should be a tool that helps you achieve your goals. Yes, you should inherently want to be more digital, however automation alone will not bridge the communication gap that so frequently causes payment disputes and gives AR teams headaches.
That’s why in this article, we’ll cover 7 accounts receivable goals every AR team should look to achieve to ensure success in the coming years, alongside the technologies that’ll help you achieve them. Any—or all—of these goals should be on your list for 2023, but it’s all dependent on what you’re hoping to accomplish—and on how much you’ve digitized and transformed your accounts receivable to date.
Click on a goal to jump directly to it:
💡 Consider this: there are many accounts receivable goals and objectives that finance teams can strive to achieve. These might include some more tactical—like sending invoices without delay—and others more strategic—like choosing to bill your customers electronically or to enact a new system for resolving disputes. The seven goals we highlight in this article tend to represent the top goals B2B companies should focus on this year.
That said, while we’re putting forth the most important goals to consider, it’s our recommendation that you first are clear on the factors impeding your existing processes. Elsewise your struggles will persist, regardless of your aspirations.
Unsure what challenges you’re currently experiencing? Take our 6-minute assessment and identify the most pressing problems your AR team faces today.
Accounts receivable goals and objectives are tangible, achievable, actionable intentions that finance leaders set for their AR teams or for the broader business. They provide focus and targets for the business to work towards. And today, most businesses view digitization as a key part of goal setting.
However, despite digitization being more important than ever, few businesses have fully digitized their accounts receivable department.
Spoiler, even the highest-adopted AR automation tools have only been embraced by less than 50% of the 1,000 executives we polled on the state of digitization in B2B finance.
That said, businesses are beginning to digitize AR—in fact, those that already have are seeing significant efficiency gains. However, many businesses have a long way to go.
We know this, because 60% of those executives agree that their company’s AR departments haven’t yet been prioritized as much as other departments for digitization. So, how strategic your finance leader wishes to be—or how transformative their aspirations are—will often depend on how many of your accounts receivable processes have been digitized. Luckily, there’s no better time than now to focus on digital transformation.
Without further ado, here are 7 accounts receivable goals and objectives you should consider setting to ensure your business is well-equipped to accelerate cash flow, drive efficiencies, and deliver exceptional customer experiences:
If you haven’t already, put this accounts receivable goal at the top of your list for 2023. You stand to gain major time-savings from transforming your accounts receivable, and much of this comes from bettering tasks like invoicing, collections reminders, payment processing, and reconciling information in your ERP. These are the typically routine tasks that eat up much of your AR team’s time.
Eighty percent of finance executives happen to report reducing time-consuming, error-prone processes as a top benefit of AR automation.
There are many advantages to being able to easily and securely accept payments online from your customers preferred payment methods—including credit, debit, ACH, virtual cards, bank payments, and more.
Benefits include improvements to cash conversion, faster payment collection and processing across all sales channels, and optimized processing costs—making this accounts receivable goal highly desirable. In fact, 70% of finance executives report the ability to accept digital payments as a top benefit of AR automation.
Cash application is an important part of your business, but doing it manually brings challenges, such as:
With advanced cash application automation technology, you’re able to harness powerful tools that make your cash application process smarter, faster, and stronger. Having this capability makes capturing and reconciling payment data easy, eliminates data entry errors, and speeds up cash flow.
Everything you need to turn AR into a value driver once and for all.
Help your AR team do what it does best: drive the business forward—not spend hours performing administrative duties.
In solving inefficient processes, you open the door to greater career development for your team of AR professionals. Automating the tedious, time-consuming work AR teams perform regularly—like preparing invoices, making collection calls, and processing payments—and empowering them with the technologies needed to prioritize customer experience, frees them to perform more strategic work.
Achieving this accounts receivable goal will make team members happier and more engaged as they get exposure to greater challenges that will set them on the course for career growth
Seventy-five percent of finance executives report increasing bandwidth for accounting and finance teams to take on strategic initiatives as a top benefit of AR automation.
Miscommunication in the invoice to cash process leads to tangible, negative effects on revenue. Fortunately, AR automation tools do have the capability to remedy that. And yet, not all AR automation solutions are created equally; and most traditional solutions don’t improve communication between your team members and your customers.
That’s why when looking to achieve this goal it’s important to seek out AR automation tools that prioritize ease of communication and collaboration between you and your customers. These tools can bridge the gap between AR being either exclusively hyper-efficient or a core contributor to customer experience—and can ensure AR teams are delivering not only against their efficiency targets, but simultaneously building flourishing, collaborative payment experiences.
Sixty-five percent of finance executives report fostering a culture of collaboration and an excellent customer experience as top benefits of AR automation. Meanwhile, 35% recognize that their existing difficulties communicating with customers are preventing them from capturing revenue faster.
With record numbers of employees choosing to leave their jobs in the last two years, or quiet quitting in their seats today, finance leaders who want to avoid the damaging impacts of high turnover should turn their attention to the accounts receivable goal of enabling long-term remote work and prioritizing employee satisfaction.
Digitizing the billing and payment process can ensure work from home continuity by eliminating the tedium of collecting on outstanding receivables, and empowering AR professionals to take on strategic work. In fact, 73% of finance executives report an improved ability to attract and retain accounting and finance talent as a top benefit of AR automation.
Delivering always-on access to complete, shared invoice and account information helps eliminate tedious manual workflows and create superior customer experiences. The latter is an increasingly sought-after competitive advantage that’s ripe for prioritization from within accounts receivable.
Sixty-five percent of finance executives report that providing shared access to information and data over the cloud is a top benefit of AR automation.
Regardless of which accounts receivable goals you strive for, remember that automation alone is just one piece of a very large puzzle. The AR function has influences beyond capturing revenue and should be seen as integral to your overall customer experience initiatives.
To bridge the communication gap that so frequently infects AR and causes payment disputes; and to accelerate cash flow and drive efficiencies, you'll want to transform your accounts receivable. And to do so, you'll need the right technologies.
Take our 6-minute assessment and get your personalized accounts receivable transformation roadmap. Learn exactly where you are in your digital AR journey, how you stack up against peers, and how to set your AR team up for success.
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