Advances in technology have enabled collections†teams to increase operational efficiencies and eliminate some of the redundant, manual tasks that drain collections†productivity. This has had a direct impact on DSO†with companies noticing a reduction anywhere in the range of 5% to 10%. Most of the technology deployed for collections†management†is focused on solving at least one of the functional areas of the collections†management†process.

Figure 1: Functional Areas in Collections†Management

In this section, we discuss some of the technologies which are already helping collections†teams perform better. Electronic Invoice Presentment†And Payment As discussed earlier, customers not receiving invoices is one of the biggest reasons for delayed payments. The switch to electronic†invoice presentment†and payment (EIPP) helps collections†teams ensure timely invoice delivery. Additionally, electronic delivery also provides the ability to keep a close watch to monitor if the invoice has actually been viewed or accessed by the buyer. Another aspect that helps in speeding up payments†is the ability for buyers to pay electronically through a single system. Most EIPP systems accept customer†payments†through ACH†and credit cards. At the same time, invoice and payment security remain top concerns for collections†teams when evaluating EIPP solutions. However, a bigger concern, which directly impacts the effectiveness of such solutions, is the rate at which buyers in a particular industry or market are willing to adopt these electronic means of invoice delivery and payment. Automated and Dynamic Customer†Prioritization Prioritizing collections†is one of the main challenges faced by organizations today. Collections†management solutions that allow segmentation of customers and have the ability to assign some collections†strategy to each of these segments are a necessity to handle the growing business volume. Such solutions eliminate the manual work required by the analyst to create a daily or weekly collections†items list. The technology is capable of working in the background to evaluate factors including the size of the customer, past payment history†and behavior and other aspects to create a collections†list. Team leaders benefit from such systems that guide the collections†teams with recommended strategies and actions based on the particular category to which the customer†is attached. In the end, the biggest benefits are clearly two-fold ? standardization of collections†activities based on customer†categories and the elimination of the manual work required to prepare the collections†worklist. Automated Customer Correspondence By establishing a single system for all customer†correspondence, technology is able to empower collections†teams to perform both strategic and tactical correspondence†activity with customers without spending disproportional amounts of time. By creating ready-to-use templates out of the most commonly used communication†across customer†accounts, it is possible to significantly reduce the amount of time taken to correspond with customers. Such systems make it possible for an analyst to select a group of ten customers in a batch, for example, and send an email to them via a single template which collects information relevant to each in their individual correspondences A major load could be removed from collections†analysts by enabling these systems to respond to the ad hoc information requests from customers. Copies of due-invoices and other necessary documentation are†automatically attached to the main correspondence. Collections†management technology is creating a huge impact on how collections†teams work today. Most teams adopting new technologies deliver better collections†outcomes with fewer resources while addressing the overall agenda of their organizations to maintain positive customer†experiences without impacting cash flow†and working capital. To learn more about technology solutions used by leading companies for credit and collections management, visit www.highradius.com