ERP systems are impressive and powerful tools and the backbone of companies around the world. As ERP resellers and developers, we know this to be true.
Like anything else though, ERP systems have limitations and if you’re currently managing accounts receivable in your ERP system, you are surely experiencing some of those limitations. Sure, your system has a module for accounts receivable management, but that doesn’t mean you should rely on it- and here’s why.
ERP systems notoriously lack the depth of functionality, insight, and automation necessary for effective collections and without proper accounts receivable management practices and tools, all you’re left with is slow cash flow, a promise to pay, and an invoice…and none of those things can cover your expenses.
If you’re unhappy with your DSO, are experiencing low cash flow, have a significant amount of bad debt, have a tough time keeping up with all of your collections activities, have numerous invoice disputes, or if you are feeling generally overwhelmed and unproductive in your collections efforts, it may be time to seriously consider moving away from your ERP for accounts receivable management. The alternative? A tool meant for the job.
Accounts receivable management software is designed to integrate with your ERP system, automate communications, centralize all of your collections information, increase your cash flow, and generally help you get paid faster than you ever have before. Below are 21 things that accounts receivable management software can do better than the collections module in your ERP system to quickly turn your invoices into cash.
- Automatically create an action list to tell collectors what to do and when for optimized productivity.
- Provide all of your collections information in one screen so you know at any given time what’s happening with your A/R collections or how you can improve your efficiencies.
- Handle disputes and dispute resolution.
- Provides a Customer Portal with Online Bill-Pay.
- Automatically send email reminders to customers about outstanding invoices (and copies of the invoice) based on rules you’ve provided.
- Attach original PDF copies of invoices to communications.
- Automatically update account information for real-time insight into your collections.
- Provides sophisticated A/R workflow management reporting.
- Flexibility to adapt and change collection and dispute management strategies.
- Automatically retrieve emails sent from customers and bring them into the system providing a centralized view of every customer interaction.
- Allows you to set service level agreements and define escalation paths.
- Track and automate all emails associated to credit collections.
- Automate the creation and assignment of actions to collectors.
- Automate closure of issues when customer payment is received.
- Automate the escalation of credit issues to managers.
- Automate the tracking of broken promises.
- Define automation and workflow based on credit class.
- Manage every aspect of your customer communication including phone calls, disputes, expected payments, and email from a single screen.
- Allows your collectors to spend more time talking to customers about payment, a proven way to speed up the time between invoicing and getting paid.
- Attach supporting files to communications such as bills of lading, proof of delivery, employee timesheets, contracts, etc.
- Provide an ROI in as little as 2 months.
As the above illustrates, using your ERP for accounts receivable management is an option, but it’s not the best one. You purchased your ERP system to optimize your operations and improve productivity so you could increase your profit- why not do the same for your credit and collections team?
________________________________________________________________________________________
