How to modernise cash collection with automation
It’s not unusual for a cash collection team to spend hours preparing data and planning for the month ahead. You might even be in this position yourself.
Sometimes it’s updating information in or from the sales ledger, other times it’s adding notes, working out what’s been paid or even working out who needs to be called based on the value of overdue debt. Or simply; who didn’t you call yesterday that you still need to?
Over the course of a month, this can be a hugely inefficient way of working, not to mention how frustrating and time-consuming it can be. It’s only made worse by the fact that no matter how much you do, some calls still result in a failed attempt or waste of time because of a whole raft of factors.
The credit management team can sometimes feel like everyday is groundhog day and never do see the wood from the trees. They are often faced with attempting to pick their way through a huge maze of data and information, much of which is not in the same system, or even in the same department.
How many times are calls made where customers say they have already paid only to find a payment unapplied in another account, a remittance is sat in a folder in the cash apps team, not visible, or a customer is going to pay you next week regardless of you making the phone call?
Then the day, week and month closes in and it’s a race against the clock to try and make sure targets are hit and customers are called. And then its starts all over again. And again. Every month. It can be frustrating and monotonous for the whole team.
But how do you manage this? How can you change it for the better?
At least a spreadsheet can pivot data to be able to better segment a ledger than the ERP system, but again, they need updating and managing and they quickly become another blocker to efficiency during the month. At the end of the day, they don’t continue to add value they just become the norm.
Further still, most 3rd party systems are expensive, take a long time to implement, and it’s not always easy to justify a good ROI from a business case. They tend to still work on the principle of a ‘smart’ spreadsheet by segmenting the ledger and creating workflows. They can be cumbersome to operate, don’t have a real-time view, and never have the full picture, for example they can’t see a remittance in the cash team.
A smarter way to collect
Manual cash allocation and collection is still the norm, but it’s not the only option. Beyond tools that help credit management teams, there is a whole new breed of cash allocation and collection; automation.
Automation and robotic process automation (RPA) offers a smarter way to collect cash.
There are now systems (Alloc8 Collect) that support the collections team by giving them all the information they need in real time, allowing them to only call customers that need calling and where the success rate is much, much higher.
Automated cash collection solutions, such as Alloc8 Collect can give real-time views of cash coming in and remittances, even before the cash arrives in many cases. With dynamic segmentation and event management that auto updates information on promises to pay, payments in, actions closed, means that collectors are focused on the actions they need to make.
Couple all of this with built in auto escalation and prioritisation alerts and collectors and team leaders can then pro-actively manage the process. The ability to change strategies in real time and focus on different strategies during the course of the day, week or month means you can adapt at all times to any change in personal or customer behaviour.
All of this built on top of a smart intelligent engine that forecasts and predicts when a customer will pay gives you confidence and control, as the system will alert you if a customer who was forecasted to pay misses their date etc.
From a management perspective it’s really simple with a dashboard that tells you on day one of the month what cash you are likely to collect even if you did nothing.
It is truly a smart way to collect.