In a department not utilizing accounts receivable management software, a lot of time is spent doing manual tasks. You’re stuffing envelopes with invoices, creating and sending emails to each customer, working off of spreadsheets with highlighters and processing checks. The number of hours spent each week on tasks like this end up taking up the collector’s entire work week. However, it doesn’t have to be this way.
As accounts receivable management software makes its way into more and more accounts receivable departments, the role of the collector is changing. Those working in the accounts receivable department are no longer spending their time checking off the manual tasks on their to-do list. Instead, they have become analyzers and problem solvers. They are relied upon by their company to thwart out oncoming cash flow issues and create a full accounts receivable plan.
The role has changed because accounts receivable management software has allowed collectors to do so much more. Take for example the graph below created by the APQC showing the total number of invoices processed by a collector.
So, what’s the big difference between the bottom performers and the top performers? The use of automation. Being able to process more in a shorter amount of time isn’t all accounts receivable management software can help your team do. As their role expands since they are doing less manual tasks, you can expect your collector to be able to take on the following analyst roles:
ISOLATE ROOT CAUSES
It’s important to have an aging report and track which companies are paying you on time and to find out who your big offenders are. However, it’s more important to do something with that information. When you see the same companies not paying over and over again, find out why. When collectors aren’t doing the same thing over and over, they can dig into these reports, find out why customers really aren’t paying and cut the issue off completely.
IDENTIFY TIME AND COSTS SPENT
When you’re spending a majority of your time just trying to keep your head above water, there is no time to go through and find out exactly how much time and money it takes to get the job done. Once your team has time to do this, you may be able to find a more time and cost effective way of doing things. Maybe this is encouraging customers to go paperless, which would cut back on paper costs or using an automated phone system to curb the amount of time collectors spend reading off past due amounts to customers.
VALUE ADDED TASKS
Your accounts receivable team is worth so much more than having to go through spreadsheets highlighting the names of those who have been contacted or not contacted, paid or unpaid. Often times, the talent in your department has yet to come out once they have the time to show it. Your team can often take on tasks and roles that add more value to your accounts receivable team and give you more cash flow.