For many organizations today, accounting activities, especially those done by accounts receivable (AR) teams are very manual processes. From working on several spreadsheets at once, managing five or more disparate systems to having to rekey everything by hand. These processes are not only tedious, they are an inefficient time suck that creates unmanagable data silos.
These data silos need to be connected so users can collaborate easily and improve efficiency. Automation can increase the connectivity between silos to enhance data collection, analysis, and reporting in order to improve the collaboration of users to increase operating efficiency. AR automation solutions are connect information silos and enable collaboration of users.
With organizations tightening their belts, here are two reasons why you shouldn’t delay your AR automation project.
Eliminates the Need for Repeated Data Entry
Working as fast and efficient as possible is the goal of well-oiled accounting teams, but entering and reentering data from spreadsheet to spreadsheet to ERP to invoice to payment system to spreadsheet to email and back again, mistakes are inevitable. In fact, a recent study found that 49% of invoice disputes are the result of ‘invalid or missing purchase order information.’ These keystroke errors can be prevented with AR automation. Beyond, this, leveraging automation as a “second set of eyes” ensures you have everything you need to get your job done faster and more efficiently.
The system can be set up to notify you when an invoice for a customer is missing a predetermined piece of information, like a purchase order number. If an invoice is missing the data, the system will alert you to the problem; letting you update your customer in real time, avoiding disputes or late payment.
Through AR automation, you can access all of your customers’ important information quickly and easily in one place, without having to navigate from one screen to another or jump in and out of programs to find what you need. You’ll have instant access to information such as contact information, important dates, activity counts, disputes and broken promises, aging, open issues, open and overdue invoices, payments, average days to pay, a summary of communication, and more are at your fingertips 24/7.
Improves Customer Connections
Are your customers each unique and different? Do some pay on time, like clockwork, while others are 15 days late despite your best efforts? How often are you connecting with customers today?
Many companies send an invoice and do nothing until the invoice is late and then they start playing catch-up because they do not have the time to deal with sending letters/emails and making phone calls to customers to help avoid this situation.
AR automation allows you to schedule how you want to communicate with who, however frequently that should be. The system will automatically send reminders and notifications when the invoice is created, as the due date approaches and when the invoice is past due. It can even send a thank you note once the payment has been received. For each of those automated communications, you can set the rules that define when they are sent to specific customers and utilize customizable templates to support your brand and strategy.
Having a difficult time sorting and developing an activity management strategy? A strong activity management strategy leads to a greater understanding of the team’s workflow and the activities (and customers) that take the most time and energy to complete.
With AR automation you can quickly pull up a customer accounts, review it, and take the necessary actions without wasting time digging through old emails, looking up information, and reading notes you’ve scribbled in the margin of spreadsheets.
Those with manual processes spend only 20% of their time soliciting customers for payment, collectors with accounts receivable management automation spend 60% of their time talking with customers. AR automation allows teams to reallocate their time away from clerical duties and focus it on communicating with customers, settling disputes, and other more critical tasks that lead to faster invoice collection.
Time and again, customers who use AR Automation are seeing greater efficiencies and significant reduction to DSO. With a connected accounting solution, like award-winning Lockstep, for your finance team to coordinate work with customers and vendors, you can go digital and enjoy the benefits of office automation.
Award-winning Lockstep® connects the world’s accounting teams to help them work better together. The pioneer in Connected Accounting, Lockstep develops tools and platforms for fintech developers and accounting teams to automate workflows between the accounting systems that are at the heart of all businesses.