Controllers Council recently held a panel discussion entitled, Transform Your AR Process: 5 Proven Strategies for Success, sponsored by Billtrust.
Billtrust is a B2B order to cash software and digital payments market leader. Billtrust helps the world’s leading brands move finance forward with AI powered solutions to transition from expensive paper invoicing and check acceptance to efficient electronic billing and payments.
Our expert panelists are Steve Emberlin and Barbara Salazar. Steve is an SVP finance for many years and most recently at Care Fertility with 30 plus years of experience, multiple controllerships and earlier stints with the big four accounting firms, PwC and Ernst & Young. Steve is an active CPA in California. Barbara Salazar is a CPA and Chief Financial Officer of 7X Group that is in construction, real estate, and other industries with more than 25 years of F&A experience. Prior roles included VP Finance, CFO, and corporate controller with experience in SEC reporting, SOX compliance, and audit at PwC.
Following are key takeaways to this discussion. If you are interested in learning more, view the full webinar archive video here.
What are some of the challenges your company faced with manual AP processes and how AR automation address these issues?
Steve: In our last organization that I was a part of I referenced 100 million ARRs, not a small company, but the processes were very manual, extremely time consuming to just generate invoices. There were a lot of on the backend kind of audits of the invoices, double checking, triple checking information, following up on billings information, contact information. There were missing fields in our CRM, which was Salesforce that drove billings. So, we had a lot of Salesforce data integrity issues, and the data wasn’t clean. So, what that meant was we couldn’t do any kind of integration with our ERP system. So, Billings were very manual. We had to create a cross-functional team that was basically establishing a game plan for improving and ultimately cleaning up the data. We had to document processes and workflows establishing ownership around the data and data quality and data integrity. Ultimately, our goal was to do an integration with our ERP system and Salesforce, saving time, improving month and close and that type of thing. I would say not automating created a lot of extra work.
Barbara: In our company, we have a 3,360 customers. We do have both short-term accounts receivable and long-term accounts receivable. When you work with lawyers and get paid later, AI management is extremely important. We face numerous challenges. We did try to solve a very high headcount cost due to manual processes by using virtual assistants, but of course they’re not virtual. They’re just people working from Philippines and coordinated for a company which does reduce costs, but it causes quality because they require a lot of supervision, and the interaction of people from Philippines with your customers can be tough.
Do you automate invoicing?
Steve: At the time, it was not automated. There was a lot of kind of data dumping that was coming out of Salesforce and a lot of manual auditing and checking and double checking. There were times where we didn’t have contact information. We didn’t have proper email addresses or contact names, or sometimes the data was just incorrect. So, it just was extremely painful and time consuming. But the automation effort was underway for this fiscal year, and I believe the goal is by the end of the summer to have invoicing automated.
Barbara: Right now, we are not having invoices automated, similar issues with getting data from Salesforce. Salesforce should not be your data for AR. That’s the unfortunate reality. We are spending an extra time right now getting ready for automation that will totally speed up our processes.
Is your credit application process manual or automated?
Barbara: Credit application is part of the automation process. So right now, it is manual. But in my prior company, it was automated because we were on Billtrust. Credit application is not automated. We absolutely do it manually right now. It takes a lot of time and they are looking forward to automating it as part of our automation process.
Steve: I’ve been at plenty of organizations where there was neither a manual nor automated credit application process, where credit applications just weren’t enforced. I think part of it had to do with the customer base. When you’re selling into Fortune 100, Fortune 500, or even Fortune 1,000 or 2,000, you kind of know who they are in publicly traded organizations. And maybe the risk is low. Nonetheless still really important to at least have some kind of process.
Are you using AI or other technology to customize workflows to make collections more efficient?
Barbara: I think with AI, if you’re trying to develop your own AI, which is appropriate for certain areas like accounts payable and reconciling bank statements, it could be done, but with accounts receivable and especially collections, I would try to avoid it. It is highly risky because it is customer-facing. But when you automate, you do save more money and time. In my opinion, it is highly advisable to use AI, which I did in my prior company, and will do in my current company. But rather than develop it yourself in such a high-risk area, hire a trustworthy company to help.
Steve: I think every organization should be evaluating systems these days with appropriate price points. I think every organization ought to be looking at streamlining and automating, creating efficiencies throughout finance. And finance is historically under-resourced, under-invested in. I think utilizing AI and AI technologies to customize workflows and streamline collections is vitally important.
Does your company use a payments portal or other tools to streamline transaction processes?
Barbara: In all my AI automations, I try to use providers which do offer the payment portal. Billtrust does have a payment portal, where your customer could easily log in, select multiple options for payments and just pay you. Currently, with a manual process, there is no way to select and do your own payment portal.
Steve: Really a rule of thumb is to make it as easy as possible for customers to pay you and if that means adopting a system that has a payment portal then so be it. My prior organization, we were old school and we accepted wires and ACH payments. But as I alluded to, there was a system implementation that was underway that, to the best of my knowledge, had a payments portal.
What other tips or processes can you recommend to transform AR?
To view this question and the complete webinar, download here.
ABOUT THE SPONSOR:
Accounts receivable needs people with vision, talent, and the technological genius to streamline B2B transactions from both sides. And it needs champions of the accounts receivable (AR) department who know their teams’ time could be better spent beyond the monotony of manual keying and paper processes. Billtrust began questioning the status quo in 2001, just as a new millennium was taking off. Perfect timing for the merger of inspiration and innovation to propel real change in AR automation. Today, the company continues its mission to modernize processes for a better balance throughout the order-to-cash cycle. Learn more about Billtrust at www.billtrust.com.
