Robotic Process Automation (RPA) tools currently reside at the “Peak of Inflated Expectations” in the Gartner Hype Cycle for Artificial Intelligence, 2018.

As always with technology, during the discovery cycle everyone is tempted to think that it will solve all problems, hence the next stage of the Gartner hype cycle — disillusionment.
There are two ways to use tools & technology:

• You have a hammer, you see a nail, you hit it and it works.
• You have a hammer, you see a screw… you hit it and it “kind of” works.

Indeed, when you have a hammer, everything looks like a nail. In order to avoid inadequate usage of technology, I will try to explain what RPA is as well as its appropriate scope of use.

RPA is a program or a set of programs, that have been developed (usually using a “macro” language) to manipulate other programs. This program runs on a desktop and performs the operation (the macro) as if it were a user, hence why it is often named a bot. For example, it can open your email, grab some text inside an email and copy the text into your CRM or ERP user interface.

Usually with macro-languages, a macro-recorder helps you “implement” the macro. If you want to see how it works, try it with Excel: Search “recording a macro” in Google and it will propose dozens of video tutorials.

How is RPA different from a macro in Excel?
According to Wikipedia: “RPA tools differ from such systems including features that allow data to be handled in and between multiple applications.”

Simply formulated, it is a macro tool that can work with several applications, connecting the dots in manual processes. This is a great evolution; however, you may agree that this proposal alone isn’t mind-blowing.

So why the hype?

The claim (which causes the hype) is the following: RPA systems develop the action list by watching the user perform that task in the application’s graphical user interface (GUI) and then perform the automation by repeating those tasks directly in the GUI. This can lower the barrier to use of automation in products that might not otherwise feature application programming interface (APIs) for this purpose.

It is a way to automate manual processes and save both time and money, which obviously is very appealing. However, the sentence “that might not otherwise feature APIs for this purpose” is important. This sentence begins to answer the question about the scope of use of RPA. If you have an API you should use it, it’s much more reliable and maintainable than a robot.

But what if you don’t have an API? Let’s say your customers or vendors are forcing you to log into their homemade portal to download orders or invoices. This may be a good use case for RPA.  If you need to log in every morning into 30 portals and check if there are orders or invoices, there might be a good ROI (Return On Investment) in automating this task with RPA.

Consider the cost of training your customer service team to use these 30 portals, the risk of losing an order, and a simple ROI calculation will give you an answer. However, you also need to take into consideration the fact that the portal user-interface may change. Be prepared for maintenance, as while APIs typically guarantee upward compatibility, it is not the case for a GUI.

Now let’s look closer at the first part of the claim and what is really causing the hype: “RPA systems develop the action list by watching the user perform that task in the application’s graphical user interface (GUI) and then perform the automation by repeating those tasks directly in the GUI.”

This is a more compelling vision. With Artificial Intelligence (AI), a bot just observes what a user does and learns by itself what needs to be done and how to automate even a complex process. As Gartner says: “When choosing a vendor, also ask for future AI-based options.”

RPA is an advanced macro tool that automates simple tasks but to get to the next step, the real thing resides within AI — hence why many vendors use a bit of AI and start calling the technology “cognitive RPA.” This level of cognition is what influences the TCO. If you have to maintain hundreds of bots, what will be the maintenance cost over one year, two years, etc.?

When you select a vendor, here is a list of questions that are relevant:

• What is the level of “cognition”?
  • How intelligent is the bot?
  • What exactly does it learn?
  • Does it learn only once?
  • Does it need to be taught?
  • Does it continue to learn after it has been implemented?
  • What happens if something changes?
• What is the TCO?
  • Do I need IT resources?
  • Do I need developers?
  • For how long?

In Esker’s Order Management solution, we use machine learning to study how users extract data from sales orders. The machine-learning engine identifies where data is located, its format and whether it is always in a fixed place or moving up and down (like a floating total for example).

The engine learns continuously: if something changes, it will learn the change. This AI-driven technology is part of the application, it does not need any IT resources to maintain it, it does not need developers, it just learns by itself.

Now that you better understand this technology and what it is able to do, how will you leverage it in your business processes?

Check out more posts in this series

What’s the Difference? [RPA, AI and Machine Learning Series]

We recently published a case study with Remarkable Liquids after speaking with VP of Execution Jason and Project Manager Mac Deaar about their use of TermSync, Esker’s collections management tool. Below is an edited and condensed version of our conversation.

Esker: Let’s start off with a bit of background; what does Remarkable Liquids do, and what do you both do at the company?

Jason: We’re a craft beer distributor. We distribute to all of New York state and also New Jersey. We distribute craft beers, ciders and even things like mead. I’m the vice-president of execution and oversee all the human resources function and the office staff.

Mac: I’m a project manager. I handle various things like reporting to New York state for past due accounts, anything with state liquor authority, and compliance.

Esker: Great. What particular challenges did you experience that led you to look for an automation solution like Esker?

Jason: There’s a New York state rolling calendar where if beer is sold in a two-week period of time, it’s due on a certain day. But if you buy beer between X date and Y date, it’s due on Z date. If they don’t pay by that date, then we report them to New York state and all distributors (including ourselves) are prohibited from delivering without collecting COD (cash on delivery).

Mac: For accounts reported by any distributor for a past due invoice over a certain amount of time, no distributor in the state can deliver to that account without that delivery being paid COD.

Jason: So a lot of it came down to collecting payments in a timely fashion. This [Esker] gives our customers an option to pay quickly and on time. Customers can see their own account and check their past due invoices. It also frees up our sales reps from having to waste time running around collecting checks and whatnot. It’s another way for us to not have to deal with the old “the check is in the mail” excuse.

Jason: As a small, young company, accounts receivable is hugely important. We knew that our time to get receivables into the bank was longer than we were comfortable with. So this also was to help us speed up payment.

Esker: And how has Esker been able to address that challenge?

Mac: It allows us to get the payment on time. Esker has helped us build reports on who to send. We actually use it to send messages to customers through the collections management tool.

Jason: VIP [an ERP system] and Esker are able to work together to understand when people are being reported, when they need to pay, and the payment amount. The files flow through so that they show up when they’re paid via Esker. They’re going to show up in VIP within a fairly short period of time on our AR system.

Jason: We’re also really pushing it with our sales team. Like I said, we don’t want them wasting time running around picking up checks. The AutoPay feature allows us to be pretty much insured that we’re going to get payment. We’re definitely seeing a steady amount of growth in additional Esker customers each month.

Esker: Could you tell us a little bit more about your experience with the AutoPay feature and how that’s changed your AR process?

Mac: It’s really great from the perspective that the sales reps no longer have to deal with that account for payment. It completely removes it from their responsibility, meaning all the sales reps have to deal with is placing the order. We no longer have to track that account down for payment. Once they’re on AutoPay, it’s great for us. That really speeds up the process.

Jason: Even though we’re a small company, our territories are large. Compared to other distributors that have been around for many years, we don’t have nearly as many sales reps. We have to ask them to do more, and tracking down payments is not a fun part of the job. If we get somebody on to AutoPay, it’s no longer something that we need to worry about (as opposed to tracking them down, making a plan, and communicating that with the office). So that’s great.

Mac: The majority of customers that sign up actually do it on their own. I would say that very few sign up because we tell them they should. They just sign up initially when they’re coming on as new customers, or they’ll see the AutoPay button in an email.

Jason: I think the ease of allowing customers to sign up, I mean, just having to click on an email — it’s a simple process to get started, and it’s been helpful. Our customers don’t want to have a complicated process. They want to simply understand what it is and what they need to do to make it happen.

With the efficiencies that Remarkable Liquids has gained through features like AutoPay and payment reminders, its lean sales team is able to better focus their attention on what they do best: securing new customers and contributing to the growth of the company. Along with seeing on-time payments increase and providing a better experience for its customers, Remarkable Liquids has also seen a reduction in DSO and has collected more than $3.4 million through its Esker solution.  

For a quick overview on the things we talked about here, check out the full case study.

Potter Electric Signal Company has been manufacturing products in the life safety market for 121 years now. Being a highly innovative and experienced business, Potter Electric started working with Esker in 2016 to automate its accounts payable (AP) and, more recently, accounts receivable (AR) processes.

We had a conversation with the Vice President and Global Corporate Controller for Potter, Elizabeth Cassady, to talk about how that decision came about and the results she’s seen since. In Part 1, we talk about the AP process in particular. Note: This interview has been condensed and edited for clarity.

Esker: Thanks for speaking with us today, Elizabeth. To start us off, can you tell us a little bit about Potter Electric and your role at the company?

Elizabeth: Sure. Potter Electric was founded in 1898 and manufactures products in the life safety market. We have three divisions: sprinkler monitoring devices, fire alarm panels and security devices.

I am the Vice President and Global Corporate Controller. I’m responsible for all of the Potter’s accounting functions worldwide and have been with the company for just about three years.

From an accounting and finance perspective, we use Epicor as our ERP system and Tableau as a business intelligence tool. We use Esker for accounts receivable and accounts payable.

Esker: What caused you to start looking for an AP automation solution?

Elizabeth: I often say the impotence for looking was actually when my accounts payable manager approached me asking for a third monitor for our accounts payable clerk. Our ERP system does not have an automated three-way match, so the three-way match between the PO, the receiver and the invoice was done manually. It seemed ridiculous for one person to have three monitors and to have to do that all on our own. That really prompted us to look outside of our ERP solution for something that could automate that three-way match for us.

Esker: How did you start to search once you realized you wanted an outside solution?

Elizabeth: We started the search in late 2016 and settled on Esker within about a month or two. It was just a Google search. I came from a public accounting background so the private company world was new to me to begin with. I had never really dealt with AP automation, and my clients had never dealt with AP automation either. So between me and our IT department, we came up with three companies that we decided we liked. Esker was the only solution of those three that offered a broad range of solutions not just in the AP space, but also AR and other functionalities.

Our company is in a rapid period of growth, and we didn’t want to pigeon-hole ourselves with a solution that could only do one thing for us. We thought that Esker could expand and grow with us, and that’s why we ultimately chose to go with Esker over the other solutions that we looked at. We started the search in late 2016 and settled on Esker within about a month or two.

Esker: Could you talk more about the growth and when it started?

Elizabeth: It started in 2016. We released our own Potter brand of fire panel and have experienced 20% growth year over year since. We expect that percentage to increase even more this year, so the scalability that came with implementing Esker was great.

Esker: Other than the scalability that Esker offered, what else made Esker appealing as a solution for accounts payable?

Elizabeth: The ability to customize a solution that would work for our business. Most of the other solutions did not have that as an option. We’re now comfortable that if something changes in our company, we can go back to Esker and do something different. That was really appealing when we were in the decision process and it turned out even better than we thought or expected.

Esker: About how long did that whole process take?

Elizabeth: It took about six months to get all of our customizations done. I want to say we probably signed the contract in March or April and went live November 1st.

I can’t say enough about the customizations we did. The software development team worked very hard for us. They even traveled to St. Louis for a couple of days to sit with us and go through how we wanted the solution to work. We processed invoices with them so they could see what we needed the system to do. That was immensely helpful in us creating a solution that was right for us.

Esker: What has come out of working with Esker on the AP side?

Elizabeth: Right now, for PO-related invoices, we’re at about 50% touchless processing which is very good. That 50% is allowing us to focus our time on the remaining half of invoices that aren’t able to be touchless. We are undertaking a process this year to work with receiving and purchasing departments to help them understand how they can help us get that to 75%. Then after that, we’ll take a look at the remaining population and decide if they are capable of being touchless at all. That’s the difference though — our team has more time to spend on those kinds of conversations for improving efficiency.

We have much better visibility now through the dashboards to see exactly where invoices are in the approval process and how long it’s taking certain approvers to approve. The Esker solution is so easy to use, and I use it from my phone all the time. We had issues in the past with approvers taking a long time to approve requisitions. I’m not sure if it’s because of the ease of use, people just getting things approved quicker, or if it’s that email reminder that gets sent out, but we’re not having that issue anymore.

Check out Part 2 of our conversation with Elizabeth to hear about how Potter Electric has also leveraged automation in its collections management process as well.

Our conversation with Elizabeth Cassady at Potter Electric continues as we switch focus to the accounts receivable process. If you missed Part 1, you can find it here. Note: This interview has been condensed and edited for clarity.

Esker: So far we’ve been focusing on accounts payable. When did you turn to Esker for help with your collections management process?

Elizabeth: That was probably last summer. The collections process within Epicor was extremely manual. My collection person liked to say that she’d start at the beginning of the alphabet and by the time she got halfway through, it was time to start over at the beginning again — you never reached the end.

My accounts receivable manager attended your user conference and came back totally energized to move forward with Esker as a solution on our AR side as well. She had seen it in action there and talked to a couple of other customers who had used the tool very successfully, so we decided fairly quickly to move forward with Esker.

As I mentioned, we had chosen Esker so that we could use it to help us grow, so it was more of a matter of when, not if, we would move forward. Our experience at EAUC accelerated that for us.

Esker: Do you have any specific benefits that you have seen as a result?

Elizabeth: We have seen increased collection activity, and I think our day sales outstanding (DSO) has decreased about three days. It’s kind of seasonal in our business. Winter is a slower period for us and for our customers, plus our customers tend to pay slower. I think this summer we’ll see a dramatic decrease in our DSO compared to prior years.

It’s also pointing out those problem accounts — the ones that truly do need to be called on. Esker allows my team to focus their time on the customers that don’t respond to the automated payment reminders and really do need that verbal nudge to pay us, which I think is great.

Esker: You mentioned the automated payment reminders. What other features are you using that you’re seeing a benefit from?

Elizabeth: One benefit, I think, to our customers is that they can click on the link that goes along with an emailed invoice and go right to their portal to pay us. From my perspective, the fact that a customer can go online and pay their account via credit card is huge because prior to this, the customer had to call in and we had to take their credit card number, which put liability on us. With the customers handling that through the secure portal with Wind River, we’re not even involved anymore and it’s safer for everyone. I like the fact that we’re not dealing with credit card numbers anymore.

The other big benefit for us as a management team is the dashboards that lay out collection calls needed. The timing of those calls, how many calls are made on time, how many calls are made late — having that visibility and knowing what the staff is doing on a daily basis is so helpful. We’re in the process of developing goals surrounding the different KPIs that are tracked so that we can have concrete goals that we’re all working to achieve. It definitely helps with managing the team and workloads and providing visibility into cash flow, expected cash flow, etc. That has been very helpful.

Esker: Is there anything else you would like to add about your experience with Esker?

Elizabeth: I can’t say enough good things about our implementation team. They really did a good job of sitting with us and understanding why we wanted the system to do this, or why we wanted it to do that. They talked us through what was needed in the system versus what we were asking to do. If there was a native solution, they would point us towards that; if it was something that we could do differently to make the native solution work, they would point us towards that. If that wasn’t going to work, they were very eager and willing to help us write the code to make it work. It’s a solution that works very, very well for our company.

Thanks to Elizabeth for speaking with us! If you’re interested, you can find the completed case study here.

Craft Collective is an emerging, young wholesale beverage distributor on the East Coast. We recently published a case study about its use of Esker’s Collections Management tool after talking with founder and CEO Adam Oliveri. Below is an edited version of our interview.

Esker: Adam, thanks for joining us on the call today. Let’s start off with a bit of background. Could you tell me a bit more about Craft Collective, your role in the company and the mission behind it?

Adam: Sure. I’m the founder and CEO, and we break things down between myself and my co-founder, Brian, between internal and external things. He handles all the marketing and sales aspects of the business, and I handle a lot of the internal and physical operations for facilities and warehouse and all of that. So, AR (accounts receivable) ends up being something I oversee as well.

At the most basic industry categorization level, we’re a wholesale beverage distributor. Brian and I are long-time friends that went to college together at the University of Rhode Island. We were both doing different things in different industries, but always wanted to start something together. Brian and I are both passionate about the craft beer industry and culture, and the brewery scene was starting to really emerge in the late 2000s and early 2010s. We saw an opportunity to start a business that provided services to breweries in a segment that wasn’t really being provided by traditional distributors. Craft Collective has been in business now for almost five years, and we have around 60 employees with us.

Esker: That’s awesome Adam, congratulations! Now, if you could take us back to the beginning when you started searching for an automation solution. What was your manual process like before Esker and some of the challenges that you were experiencing?

Adam: Virtually all of our payments prior to using Esker came in through checks that were either mailed or held for pickup at a physical location for our salesman. We had customers that would wait until the day that the invoice was due to actually mail the check, which meant we wouldn’t get paid on time. Checks got lost in the mail from time to time or customers would say that they mailed a check to us — holding them accountable to that wasn’t really possible.

On the customer pickup side of things, they’d write a check and hold it there as leverage to get the salesman to come in. It had us going places that it really didn’t make sense for us to go for sales or service purposes.

Basically, it always took longer than it should have to get paid. And we had to put more resources into that area than we should have needed to in order to deal with the volume of payments that we were handling. Up until about two years ago, I was still opening all the envelopes on my way home in my truck. That was fine when it was daylight out when I was going home, but it would get a little hairy when I was driving home at night and stacking them on the dash there. You’re saving lives as well here!

Esker: Hey, well that’s a new benefit for us! Haven’t heard that one before. But yeah, that all sounds really tedious.

Adam: Yeah. It was a lot for one person to do who had many jobs. But now a good portion of our payments are coming through Esker, so it alleviates the pressure a little bit. We get paid faster, and it’s more convenient for some of our customers who are a little more forward thinking or who don’t have the cash pressure on their end that causes them to play all the kinds of games that a check-oriented payment process allows for.

Esker: How has Esker helped with these issues?

Adam: There were two major things that interested us in using Esker. The first was the portal where customers could log in and see their invoices, ask questions and interact with staff in a way that is much more manageable and trackable than email. And then the second was the ability to actually pay those invoices, schedule them and do all activities related to actually moving the money.

Customers are interacting with us through the portal, asking questions and requesting copies of things that they don’t have or downloading copies of things that they want to have. We are sending messages to customers through the system about late invoices or invoices that are approaching a period that the state considers to be delinquent in this regulated industry. The portal gives people an option to pay those potentially missed invoices more quickly, which is just a better experience than stressing them out about getting us a check.

Accepting payments through the portal has caused our day sales outstanding to go down, and there’s just a bit more flexibility there in terms of the payments that come through ACH. In our industry, our customers are bars and restaurants and things like that, and they bounce checks a decent amount as a category. ACH transactions just have less risk associated with them, so we have less money held up in that limbo stage. Having Esker has also decreased the number of customers we’ve had to put on the delinquency list.

Esker: What do you mean by “delinquency list”? Can you explain that a little more?

Adam: If a customer is past due on a certain date, the state considers them delinquent and they have to be sold to on COD (cash on delivery). I think about half of the time a customer reaches that delinquency stage is because they just lost or misplaced a paper copy of an invoice and then failed to pay attention to any of the three to five follow-up situations after that. Nonetheless, it happens. The biggest problem that situation creates is that it causes our customers to question their relationship with us. And we lose customers if the salesperson can’t navigate that interaction well. Because nobody wants to take blame for anything, they just point fingers. And oftentimes the finger gets pointed right back at us when we have to put them on that list. It’s not a good place to be in, and we certainly want to avoid it. Esker has helped us to avoid that.

That actually brings up another benefit that we’ve noticed, which is that the sales reps are less stressed out about AR than they were before. Prior to Esker, anytime there was an issue with payment or a check needed to be picked up or something, the salesperson would have to be on top of it alongside their other selling responsibilities. Now there are less instances where they need to get involved and less problematic AR situations that are tying up our salespeople’s time.

Craft Collective processes roughly 200-300 ACH payments a month through Esker. The company has seen improved relationships with customers, better staff productivity, and decreased stress among its sales staff as well. Learn more about all the benefits Craft Collective has seen by checking out the full case study here.

Core Health & Fitness is a manufacturer of fitness equipment, most notably the StairMaster, Nautilus Strength, Star Trac and Schwinn brands. We recently published a case study about its use of Esker’s Collections Management tool after talking with Corporate Credit Manager Sy Mares. Below is an edited and condensed version of our conversation.

Esker: Sy, thank you for joining us today. We’re really excited to talk with you and hear about all the things you’ve done with your Esker solution. Could you start by stating your name, title and what you do at Core Health & Fitness?

Sy: Sure. My name is Sy Mares. I am the corporate credit manager for North America, Latin America, Asia and part of the Middle East. We have global accounts in the UK, Germany, Spain and throughout the globe. Core Health & Fitness is a manufacturer of fitness equipment, and we sell to gyms all around the world.

Esker: What is your IT environment like at Core Health & Fitness?

Sy: We use Oracle and Salesforce to drive our sales and opportunities. Once an opportunity makes itself into a sale, we push the order from Salesforce into Oracle. Once we release an order, Oracle invoices the customer.  Each night, the system completes an upload into Esker. It’s very simple.

Esker: Were you a part of the process in getting Esker set up?

Sy: I was. In fact, I found Esker! When I first started with Core Health & Fitness eight years ago, we were utilizing a different collections management platform. But it felt really outdated and not nearly as dynamic as I wanted it to be. A generic email would go out to the customer without any of our logos or branding. We were unable to email invoices through the outdated platform to our customers — we would have to print them or attach a file to an email, or download first and then upload again. There was also no way for a customer to dispute an invoice online. So I started investigating other options.

Esker: Well, we’re glad you found us! After you chose Esker to replace your previous solution, what was the implementation process like?

Sy: It was really smooth. The Esker team basically gave us a document with all the information they needed and the format they needed it in. Our IT group looked at it, and they were able to write the script. It was relatively easy for them and within a month we were running parallel systems. After running parallel for a few months, we dropped the previous platform and started with Esker 100%. When we first thought of bringing on a whole new platform, our IT team was expecting it to be very difficult and to take something like three to six months, but we were fully integrated within a month and a half.

Esker: What stood out to you about Esker’s automation solution in particular over the other options?

Sy: There were so many things. We ended up going with Esker due to the dynamic reporting, customized dashboards, KPI reporting, cashflow reporting, performance reporting, and the fact that it offers live data that managers can use to mentor, coach and motivate their teams.

The executive summary dashboard is fantastic. We utilize that internally so we can show the finance coordinators what accounts they manage, what regions they manage, and customize it so that we can run our own KPI dashboards and measure the success of each individual. That helps us identify how many touches a customer is having and what the interaction is like. The customized KPI reports come in handy.

But one of the tools that really got me was the root-cause analysis. I’m a process-minded individual. I want to make sure cashflow and margins are at their peak, and I know that if there’s a problem with the process, we’re actually increasing our overall cost. So, with the root-cause analysis, we created various different types of disputes of root causes for an invoice not being paid, whether it be wrong pricing, should’ve been charged tax, quality issues, what have you. By creating all those root causes, if an invoice goes past due, my team confirms the reason from the customer and assigns the appropriate reason why. Then I’m able to run reports that show the root causes of our aging and can go to order management and say, “Hey, last month we had $100,000 worth of credit and re-bills because we had a pricing error.” After that, we can look at the issue and say okay, is it the user or do we have that price coded incorrectly in the system? Then we’re able to fix the problem and shouldn’t have it again in the future.

It doesn’t matter what line of business you’re in. I was in the beer industry before I got into the fitness industry, and prior to that was office products. If you’re able to identify the root cause of why you’re not getting paid, then you can look into what the overall process is and see if there’s something that can be changed so that it improves the overall turnaround of collecting your cash.

Esker: Definitely, that’s a great point. What other benefits have you seen since implementing Esker?

Sy: Most organizations use DSO as a measurable, but in our industry, it’s a little bit difficult to utilize DSO because there may be a sale that we decide to do an internal leasing program on, which then extends the overall timeframe in which it’s going to be paid — it’s not strictly 30 days. Instead we use the current ratio, which is taking your current balance and your zero to 30 balance, adding those together, then dividing that by your overall balance to get how much of your receivables are current.

In 2011, our current ratio was 65%, meaning 35% of our receivables were aged over 31 days. That’s millions of dollars that we weren’t collecting because of dispute issues and what have you. In 2012, we improved it to 75%, and then 65% in 2014. We implemented Esker going into 2015, and that year we jumped up to 84% current. It’s held steady between 85-87% most years since then, but today we’re at 95% current on a $19-20 million revolving balance, meaning 5% or less is over 31 days. That’s unheard of.

Esker: Wow, that is incredible! How did Esker play a role in that, if at all? Was it because you were able to identify those root causes or were there other things that helped too?

Sy: There were a lot of factors, actually. When we first started using Esker, one tool I took advantage of was sending out statements and daily invoicing. With the previous platform, we had to print and mail those invoices and statements, and a customer did not have access to their profile to manage their account. Giving the customer the ability to log into their account and download their statements, download their invoices, save them, print them, whatever they’d like, helped to start turning around the cash a lot faster because the customer was getting their invoices in hand that next day. At the same time, instead of having a monthly statement, we set up the rule to send out a statement every Tuesday.

So our customers get an updated statement on a weekly basis of what their balance is or what’s past due, instead of monthly. That’s an automated process that had an immediate impact, and we started seeing the cash flow increase and improve within a months.

Be sure to check out Part 2 of this post where Sy talks about the customer experience and the global roll out of Esker to other Core Health & Fitness subsidiaries.

Core Health and Fitness a manufacturer of fitness equipment, most notably the StairMaster, Nautilus Strength, Star Trac, and Schwinn brands. We recently published a case study about its use of Esker’s Collections Management tool after talking with Corporate Credit Manager Sy Mares. Below is Part 2 of our conversation with Sy. You can find Part 1 here.

Esker: How do your customers feel about using Esker? Do they enjoy it?

Sy: Our customers love it. We’ve gotten a lot of comments about how easy it is to manage their account through the Esker portal and how appreciative they are that they get their invoices next day when a product ships. Our customers are able to have access to their statements and for audit purposes, they can go back as far back as they need.

We recently conducted a customer survey and found out that a couple customers had given us a not favorable NPS because they wanted us to accept credit card payments rather than just ACH. We were able to fix that problem pretty quickly by turning on that feature in Esker and did another survey to find that our NPS came back at nearly world class level. And it’s because of the services that we provide. It’s not just the product that we sell, it’s “how easy is it to do business with us?” It’s important to us that from a customer’s perspective, we want a platform that presents a positive journey for the customer. We wanted a platform that was seamless and transparent and offered immediate service to the customer.

Esker: So Esker has been helpful in improving your customer experience and differentiating you from your competitors?

Sy: Absolutely.  But it’s not just our customers that have given a lot of great praise about Esker — it’s also our partners! We’ve had some of our distributors that, when I presented Esker as a tool we were using, I also presented it as a tool for them to implement into their business. And we’ve had several do that. One of our largest distributors in the North America, they just turned on Esker and love using it. It’s so easy. They have one person that manages their receivables now because Esker basically does everything for them. We have distributors that sell our product globally and they are all in Esker. They carry balances in China, Japan, Thailand, all around the world, and they’re able to access their account anywhere.

Esker: How many of your customers use Esker? Do you have a percentage?
Sy: Every one of them.

Esker: They all do?

Sy: All of them. Every one of our customers is in Esker. Most of our customers are relatively the same in that they need a statement, they need an invoice, and we need payment. We only have maybe a small handful out of those thousands of customers that need or require some sort of customized report or EDI type transmitted document. With some customers, they would say “I can’t pay unless I have an invoice”. Well, we don’t invoice until we ship. And we can’t ship until they pay. So with your help, we went through and created a process where when an order is entered in the system, the account coordinator will email the customer their order confirmation, which looks similar to an invoice and they’ll copy in the finance coordinator. The finance coordinator will go into Esker, create the profile, upload the order confirmation and email the customer with a beautiful email introducing them to Esker. It’s free service to them and they can pay online, be it ACH or credit card.

Esker: Wow, that’s amazing.

Sy: We also globalized Esker by implementing it in our UK and Germany offices and training them on the system as well.

Esker: Tell me more about that! How does Esker work with your multiple subsidiaries? What benefits have you seen from doing that?

Sy: So we rolled out in phases, starting with North America to work out all the kinks before rolling out to UK and then Germany. Implementation was very smooth since we already went through the North American implementation and we knew what was required. Within a week we had UK and Germany set up.

As far as the benefits we’ve seen, I like using the term “plug and play”. I want to make sure that if there is a process, everyone’s following that same process. The benefit of globalizing is again the reporting, the process to which we are sending out customer information, and the fact that now all our locations and subsidiaries can get paid sooner. We want to be sure that all the tools are available to everyone.

Germany also is taking advantage of the translation features available in Esker. On the account level, we’re able to change things on the customer side on their behalf so they can see it in their language. And that was really helpful!

Esker: I know you’ve worked pretty closely with your Customer Experience advocate and our support team. What has that experience been like?

It’s ridiculous, in a good way. Everyone I’ve worked with is fantastic. Once, one of my employees suggested having a search bar and within months we got a notice, “Hey everybody, there’s this new search bar”. I don’t know if it was because of his suggestion or what but the fact that Esker listens to their customers and then does something about it is fantastic. That’s service and Esker provides excellent service and support. Everyone’s timely. You don’t have to wait hours or days to get answers.

Esker: Is there anything you’ve been able to achieve through Esker that you’re particularly proud of in terms of our own personal career?

Sy: Implementing Esker itself was a highlight for me. If I left this company and went somewhere else, I’d want to take Esker with me. No matter where I go, I’d fight tooth and nail to get a company to get rid of any other platform they’re using and get Esker put in. I’m very glad to be a partner with you guys.

Check out the full Core Health & Fitness case study here.

At first blush, the odyssey of salmon returning to their home rivers and streams from the faraway ocean in order to spawn may seem to have nothing at all to do with the accounts receivable (AR) process. Chinook salmon journey upwards of 1,000 miles, climbing nearly 7,000 feet in order to lay their eggs and die (if they don’t get eaten first by hungry bears).

Though it doesn’t involve anywhere near the same level of physical endurance, the manual task of submitting invoices directly into customers’ accounts payable (AP) systems often feels nearly as long and treacherous as the final expedition salmon make. Relying on people to input data and manually move invoices from internal ERP systems to customer portals means the journey to payment is regularly beset by errors, potential compliance failures, delayed payments, and unhappy and unfulfilled employees.

Thankfully, AR departments now have tools that dramatically streamline and smooth out the processes necessary to get invoices paid accurately and on-time. Taking advantage of Robotic Process Automation (RPA), Machine Learning (ML) and Artificial Intelligence (AI) can help eliminate the unpopular manual tasks involved with collecting payments from customers and free up your qualified staff to do things that can deliver genuine value to your company.

The promise of these tools is far more than hype. As just one example, look at the big investments companies are making in RPA. Research firm Gartner, Inc. reported that global spending on RPA software reached $680 million last year, up nearly 60 percent from 2017. Gartner noted that banks, insurance companies, telecom companies, and utilities were leading investments in RPA and that it expects spending on the software to reach $2.4 billion by 2022. Another statistic highlights exactly why the investment in automation is large and growing quickly: about 50 percent of businesses still rely on manual data entry to manage their receivables.

Whether it’s AI, RPA or ML – or some combination of the three – what makes these tools so powerful in the AR department is their ability to quickly and accurately handle the most onerous manual tasks, including submitting invoices directly into customers’ AP systems. It helps to understand on a very basic level how this is possible. Take the case of ML, which is an AI technology that uses sophisticated algorithms to do what humans do – just faster and more accurately. One way to think about what AI, ML and RPA bring to the AR process is this: It’s a bit like cloning your most meticulous and hard-working staff to handle what can be an enormous number of tasks, all of which require precision.

What’s even better is that ML – unlike we humans who can get sloppier with our work as the hours pile up – gets better and better at processing invoices and noticing anomalies the more documents and data it’s exposed to. AR automation has a lot of benefits. Obviously, increased accuracy, improved consistency, enhanced control, reduced costs and better customer relationships are fundamental.

While customers, and your company as a whole are going to reap substantial benefits from a more highly automated AR process, the thanks you may receive first are likely to come from your staff. Instead of spending their time performing all of the menial tasks required to get an invoice paid, the highly trained professionals in your office can devote their skills to activities that will deliver increased value to customers and your company.

Even better, they will no longer feel like a salmon at the start of its journey.

For most credit managers and accounts receivable (AR) leaders, monitoring AR performance is an important part of the job. That’s why getting instant access to relevant Key Performance Indicators (KPIs) is such a valuable tool. But among all the figures and data, which are the most relevant for you to track and share within your organization? And why does sharing matter?

Sharing certain KPIs matters because expanding the cash culture throughout the organization is a major part of an AR leader’s job. Furthermore, AR performance should be everyone’s concern so it’s a good way to keep people involved and mindful about one of the company’s biggest assets.

For most of my professional life, I have been helping companies improve operations in one area or another. When looking to make improvements, leadership often asks three questions:

1. Do we have the right (or sufficient) people in place?  
2. Can we improve our process?
3. Do we have the right technology in place?

Often the subjects surrounding these questions are grouped together. For example, people might say, “We need to focus on People, Process, and Technology.” It makes sense that they are lumped together, as they are all interconnected; however, they are not all equal. Their connection is obvious if you have old or outdated technology — it can prevent businesses from streamlining internal processes. Likewise, if the process itself is already bad, then adding technology might not help. Lastly, if employees are not trained on the technology or don’t follow the process, issues are bound to arise.

So, where do should businesses start? I like to think of a saying my old manager said: “People are greater than process and technology.”

If there is quality staff but a lack of the latest technology or best practices, running a successful company or department is still possible. In today’s business landscape with a low unemployment rate, we are seeing that it is not always a matter of not having the right people, but rather having enough people. Sure, adding technology can allow companies to do more with less, but you also need people in place to implement that new technology. Having the right people with a clear vision to review processes also helps to ensure they are still meeting everchanging company needs. This is where many businesses turn to consulting companies that not only help evaluate a specific business process, but also recruit and staff enough people to provide the necessary bandwidth to take on new projects.

It was Steve Jobs that said, “It doesn’t make sense to hire smart people and tell them what to do; we hire smart people so they can tell us what to do.” If businesses start with the right (and enough) people, they will help improve internal processes and evaluate and implement the best technology. If you would like to learn how one consulting company and Esker’s Technology are helping customers improve their finance department, you can see an upcoming webcast this week titled Optimizing Working Capital: Digital Transformation in Accounts Receivable, Part 1 of a 2-part series.

Despite the fact that we live and work in a digital age, accounts receivable (AR) processes at many businesses remain a very manual and antiquated affair. Whether it’s manual invoice creation and delivery, back and forth emails and phone calls to manage deductions, or the sticky notes and spreadsheets for post-sale collections, it all represents money slipping through the cracks in the form of staff inefficiency, high operational costs and poor customer experience.

Fortunately, businesses who are ready to jumpstart their AR operations and embrace digital transformation aren’t out of options. Automating all or parts of the AR lifecycle has proven itself to be an effective strategy for addressing the aforementioned manual challenges and driving greater business growth, profitability and innovation.

Obviously, I could now go on and on about how Esker is a leading provider of cloud-based AR automation solutions and all the benefits that entails. However, in this instance, it only feels right to let our customers do the talking for us.

Here are 21 things companies have said about Esker’s Accounts Receivable solution:

On Increased Speed, Productivity & Time Savings

• “Esker’s automated collection tools have been a great benefit to our accounting staff. Now, they’re focusing more on customer engagement rather than manual administrative tasks.” Vice President of Finance | Hillcrest Food Service

• “Esker has been a huge benefit to me as an AR manager. Not only is my team far less stressed and overwhelmed, I’m no longer working 11-12-hour days and have more time to focus on larger scale projects that impact the company.”
  Accounts Receivable Manager | Oneta Company

• “We were looking for a one-stop-shop that could enhance our post-sale CRM and accelerate our AR and O2C cycles. We found that with Esker.”
  Controller | ProScreening

On Visibility & Reporting

• “Before, if I wanted to know what my team was doing on a daily/weekly basis, I’d have to meet with each one of them individually. With Esker, I literally click a button and the data is in front of me. What used to take 12-15 hours a week can now be done in a matter of minutes.”
  Credit Manager | Temperature Equipment Corporation

• “Esker’s AR solution has allowed us to pinpoint and improve where our receivable problems exist. Now, we can better manage what we’re doing and intelligently answer questions about why and where we’re placing our resources.”
  Corporate Controller | ProLift Industrial Equipment

• “The visibility Esker offers not only allows our team to collect faster and more efficiently, it also helps us deduce where the improvement lies and why invoices aren’t getting paid. It’s simply a great fit for our company and does exactly what we need it to do.”
  Credit Manager | Lubrications Technologies, Inc.

On Automated Invoice Delivery & E-Invoicing Support

• “Thanks to Esker, we’ve been able to help our customers move to e-invoicing and better understand the complexities of the administrative field.”
  Director of Administration and Continuous Improvement | Xylem Water Solutions

• “Esker’s intuitive and scalable solution has enabled us to automate the processing of paper invoices while progressively moving to e-invoicing. Esker’s teams are dedicated, professional and have a perfect understanding of our needs.″
  Project Manager | Nexecur

• “Today, we have a complete AR solution capable of sending invoices in all formats — paper, PDF with e-signature, and EDI — to all of our customers, including those in the public sector.”
  CIO | Eurofeu

On Improved Payment Capabilities

• “Esker gives our customers the ability to pay quickly and on time. It’s a great way for us to streamline our processes, while providing our customers a solution that helps maintain compliance. With the efficiency that’s gained, our lean sales team is able to focus on securing new customers.”
  Vice President of Execution | Remarkable Liquids

• “The autopay feature has been really beneficial for our customers, while giving us greater assurance that we’ll receive a payment. The amount of money coming in through esker continues to grow steadily. The solution will be crucial as we continue to grow.”
  Project Manager | Remarkable Liquids

• “What it’s done, particularly the payment option, is given our staff time back in their day to focus on higher value activities. Our AR department used to have to field calls and manually process payments for our customers; now, it’s a much more efficient and self-service process.” Director of Operations & Acquisitions | Toshiba Business Solutions

On the Solution’s Ease-of-Use

• “I’d had a lot of exposure to AR systems, so I knew what I wanted and, more importantly, what the team needed. Esker’s AR solution passed the test with flying colors — it’s just so intuitive and easy to use.”
  Credit Manager | Temperature Equipment Corporation

• “What drew us to Esker’s AR product was its ease of use and installation. It sounded too good not to try — and it’s been everything we’d hoped it would be.”
  CCE–Credit Manager | Crescent Parts & Equipment

• “The discipline that esker drives in the accounts receivable process is phenomenal. In my 20-plus years, it’s the best product I’ve ever used based on its simplicity and ease of navigating.” Global Director of Financial Services | Trek Bicycle

On Seamless Implementation

• “Esker was perfectly compatible with what we had in place and the implementation couldn’t have been more painless. After just a few weeks of going live, we had customers and team members telling us how slick the solution was.”
  Director of IT | LinPepCo

• “One of the big benefits during implementation was how flexible Esker was. They worked with us to translate the interface into 14 different languages, engaged with our international partners on payment strategies, and even helped us in improving the look and feel of our statements. It was a true partnership.”
  Global Director of Financial Services | Trek Bicycle

• “Esker’s solution is extremely intuitive for day-to-day AR teams. In less than a month, we were off and running — the lack of barriers was greatly appreciated.”
  CFO | Fireproof Records Center

On Using Esker Beyond AR

• “We liked the fact that Esker was the only vendor we looked at that offered a broad range of solutions, not just in the AR space but also with AP and other functionalities. We are in a period of rapid growth and thought esker could grow alongside us in terms of the solutions offered to our company.”
  Vice President | Potter Electric Signal

• “Beyond invoice processing, we would like to use Esker to automate and deliver other business documents from SAP, such as customer reminders or even to manage documents entering SAP.”
  Administrative & Finance Director | Samsung Electronics France

• “We are very pleased with our collaboration with Esker and confident about the future. In fact, we recently deployed Esker’s AR solution in the U.S. and Australia, and hope to eventually move to accounts payable automation as well.”
  Director of Information Systems | Arkadin

Check out more stories!

Organizations never get a heads up before a time of unprecedented business disruption. And when the ability to collect cash is hindered, emerging from a period of disruption with a strong bottom line is nearly impossible. So, how can businesses continue to collect cash during times like these? And how can business leaders better prepare their organizations for future times of uncertainty? We’re here to help answer those questions!

In Episode 2 of Esker On Air, host Scott Leahy chats with Customer Experience Advocate Joe Anderson about strategies for effectively managing accounts receivable (AR) processes during difficult times and the importance of equipping your AR teams with flexible solutions that promote business continuity.

The current business environment

If there’s one thing that’s blatantly obvious as a result of our current, disrupted business environment, it’s that some companies where more equipped to handle it than others. With the goal of collecting as much cash as possible, AR leaders are under a lot of pressure to act fast and make necessary changes to keep bottom lines above water during tough times. To speed up your collections, you should:

1. Assess your current collections status. In order to make informed decisions and effectively prioritize collections, you need a clear picture of your current standing.
2. Conduct a thorough review of customer categories, aging balances and at-risk cash
3. Use this information to adjust current collection strategies and tailor the process to collect cash quickly

Adjusting collection strategies and managing customer relationships   

In times like these, AR teams should focus on collecting what can be collected. One way to do this is to suspend typical collection activities to start targeting either customers with the highest amounts that need to be collected, or customers most at risk based on industry, payer ratings or past-due status.

Customers are already one of the biggest assets to any business, and maintaining strong relationships during uncertain times is vital to the future success of your business. One way to both accelerate cash collection and strengthen customer relationships is to make it easy and convenient to pay you. Here are some ways to increase ease of payment:

1. Move customers to e-invoicing. E-invoicing avoids the various costs and drama associated with postal mail.
2. Be flexible with payments. Allow customers to renegotiate payment terms and/or spread debt out over a longer period of time.
3. Provide incentive to pay. Offering early payment discounts encourages customers to pay quickly — benefitting both your business and your valued customers.
4. Let customers use their preferred payment method. Allow customers to pay in a way that is easy for them (check, ACH, credit card) to promote faster collection. Better yet, provide a self-service portal where they can make payments on their own.

Challenges of a remote AR operation and how to overcome them

When most people think about AR and collections, they typically think of someone sitting on the phone and making collection calls all day long. If that were actually how it worked, collecting cash during times of disruption would be a piece of cake. However, there are a whole bunch of important steps that have to happen before any collection call is made that require collaboration between AR teams and other departments.

For instance, before collectors can know who to call, credit teams need to communicate payment terms and credit limits with sales and customer service representatives. Then, once collectors know which accounts need to be called, it can be another battle entirely to find up-to-date contact information, payment history and account statements if the AR team doesn’t have a solution for storing all relevant customer information.

The key to AR teams working remotely is breaking down silos that impede collaboration and efficiency, and one of the best ways to achieve that is by automating the AR process. Not only does automation provide teams a way to continue operations remotely and collect cash faster, but it also empowers staff members to work better together.

In order to capitalize on the assets of AR, organizations need best-in-class management strategies in place. These eight strategies are excellent starting points for any business interested in achieving best-in-class accounts receivable management.

8 Accounts Receivable Management Strategies for a Best-in-Class Process

1. Embrace Technology
   Today, too many accounts receivable departments view technology as a threat to their existing staff members rather than what it actually is — a highly specialized team member.
2. Go Beyond DSO to Maintain Accountability
   Measuring metrics beyond DSO enables your team to track performance, hold them accountable, and achieve the results they’re searching for.
3. Push for e-Invoicing
   Studies have validated that e-invoicing can result in cost savings between 60 and 80% compared to traditional paper-based methods.
4. Confirm Invoice Receipts
   The most common reason customers give for making late payments is never receiving the invoice.
5. Follow up Early & Often
   Automation tools allow you to easily achieve on-time payments via automatic friendly payment reminder emails so that no human involvement is necessary.
6. Optimize Team Efficiency
   As much as one-third of an accounts receivable representative’s time may be spent prioritizing who to call and searching for their information.
7. Offer Self-Service Tools
   According to Forrester, approximately 72% of people prefer self-service over phone or email support.
8. Use Root-Cause Analysis
   Using automated accounts receivable management tools, your team can identify, track and categorize root causes for late-paying customers, deductions management and other areas.

These eight strategies are an excellent starting point for any business interested in achieving best-in-class accounts receivable management. To truly become the best, make sure to periodically review your process to ensure your approach remains successful.

It all boils down to this: Any organization that wants to modernize its accounts receivable process can do so. All it takes is a little help from technology and a willingness to evolve beyond the status quo.

Download the eBook, 8 Accounts Receivable Management Strategies to Make Your Process Best-in-Class, so that, when you’re ready to transform your process, you have all the information you need to be successful.

Days Sales Outstanding (DSO) is a common measure for how long it takes a company to collect on an invoice. The goal is to reduce DSO to have the lowest DSO possible and quickly recover payment on accounts receivable (AR). A high DSO value means it takes a company a lot longer to collect and could lead to cash flow problems due to the longer time between the sale and the time the payment is received.

DSO is calculated using the following formula:

DSO = (AR balance / Credit sales) x Number of days in that period

For example, if your net credit sales (sales that aren’t paid immediately) are $950,000 and your AR balance is $125,000 for a year-long period, it takes you an average of 48 days to collect from your customers. If you have 30-day payment terms, this number means you need to speed up the rate at which you receive payment.

DSO = ($125,000 / $950,000) × 365 days = 48

A high DSO has a tremendous impact on cash flow and revenue and can prohibit you from investing in your company’s growth. Reducing DSO, even slightly, can go a long way toward improving financial health. There are several strategies to reduce DSO and improve an organization’s cash flow, such as:

1. Make it easier for your customer to do business with you
   Offering multiple payment methods — such as credit cards and automatic payments, or an online option for customers to view invoices and statements — provides greater flexibility for the customer and improved cash flow for you. Are you making it easy for your customers to pay and communicate with you? Check out Esker’s payment portal.

2. Stricter credit approval
   Are you performing credit evaluations on all new customers? Are your credit terms appropriate and followed by your sales department? Does your customer service department flag new orders that do not have a completed credit app? Do you have a procedure in place for updating credit information on a regular basis?

3. Invoicing 
   Are your invoices accurate and sent out on time? Are payment terms and due dates clearly written on invoices and any other communication sent out to the customer? Have billing addresses and accounts payable email addresses verified before bills are sent out? Do you provide incentives for early pay? Are you sending out automated payment reminders?

4. Receivables management strategy
   Do you consistently follow up on customer disputes and late payments? Are you measuring performance against goals? Do you regularly review aging reports? Are you reporting on collections forecasting? Do you have an understanding as to why customers are paying late (e.g., invoice discrepancies, product issues, etc.)?

5. Collections
   Do you have a collections process in place? Do employees have the tools they need to prioritize, call and email collection efforts? Are they well trained? Do they have enough time to follow up on all past-due accounts? Are they able to efficiently keep sales and customer service in the loop on disputed invoices?

7. Incentives
   Are you offering discounts? Do you offer incentives to customers to receive quicker payments, such as early payment discounts? For example, you could offer a discount for paying within a week or 10 days when your payment terms are net 30. This discount can be easily offset by speeding up cash flow, savings on loan fees and better discounts from creditors.

8. Customer purge
   No one wants to walk away from a customer, but do you know which customers are routinely inconsistent, unresponsive or continually paying invoices late despite offering outstanding services? Has your company considered dropping bad customers from your business list? DSO increases are often driven by a few large customers. Has your collection staff worked closely with those customers to understand what is driving the slippage?

DSO is the most widely used measurement utilized by credit and AR professionals to analyze the success of their collection efforts. The more quickly you collect , the better your cash flow situation will be … and a small improvement to reduce DSO can go a long way!

There’s a big focus on digital transformation across the entire enterprise. In fact, Information Age calls out that 47% of CIO’s are seeing an increase in the pace of transformation.

CFO’s are sharing that they need to protect their organizations and get them through to the other side of Covid, and many have shared with me their need to ensure that they prioritize cash flow, minimize risk, eliminate inefficiencies, reign in rogue spending and improve visibility of cash in general.

In the last month, a VP Finance and a supply chain owner whom I spoke with have looked at the two solution wheels below and mentioned that they perceive Esker as a bit of a unicorn, given the many areas they could potentially improve via the platform. Other research analysts with large think tanks have shared the same sentiment — one in which I regard it as a great compliment. I’m more excited now than at any point in my last 21 years here at Esker knowing the many ways business and IT leaders are leveraging the technology for their companies and their careers. As it turns out, unicorns are not just for my daughter’s bedroom walls.

To give you a little more context, picture a rainy day in Indianapolis over a decade ago, where I showed business leaders a slide that illustrated automation opportunities of plenty. I could see eyes glaze over and the look of fear that a lengthy sales pitch was about to be unleashed, and all they really wanted was to focus on one business process, nothing more.

CIOs and business leaders are still choosing technologies that provide the greatest return and the least risk, but there has been a shift in the last few years toward lowering numbers of vendors and doing more with key SaaS platforms.

For example, in the last five calls I have had with CIOs, the same trends and comments were shared: “We have too many vendors and did not do a good enough job of leveraging the opportunities we had with each vendor. We are seeking vendors that can bring automation across both order-to-cash and procure-to-pay cycles, and ideally those modules would share data to provide us with predictive insights. Those insights might include warnings that a customer’s credit situation has changed, and maybe they need to be put on a different payment plan. The alerts might warn us that a key supplier needs to renew the code of conduct, share annual compliance documentation and let us know there is a new risk to be investigated.”

Having reintroduced the slide below that shows the different areas companies are tackling right now, initially I was expecting rotten eggs, tomatoes or some deep sighs. But the reaction has been quite the opposite. Nearly every time a CFO has said, “Hold on a minute, I want to see this.” One actually said, “I’m giving you most of my morning because I need help processing our sales orders faster, collecting receivables and applying our cash better, and tightening control around our AP spend. Relax, if you did not have all these capabilities, you would not be getting my time. I want to study this slide!”

Controllers have said, “Ah, cool.” But upon probing, they have shared with me that they value the ability to improve their AP process. And then, in time, tackle expenses and move upstream, and better control procurement without needing to deploy a technology that might take 18 months and cost several million. For many leaders, they like the idea of deploying in an Agile manner, tackling one process at a time. Yet it’s easier to get approval from the c-suite or steering committee as those stakeholders have wider needs for efficiency and automation.

In some cases, these trends have been driven by companies seeking to retire aging or unsupported workflow document management technologies, and those tools were often processing a variety of documents: from sales orders, AR and AP invoices, and remittance documents. For others, current and planned ERP migrations and acquisitions/divestitures have fueled interest as cash will remain king for quite some time, and these processes are still paramount.

Many agree that broken, paper-based processes were quickly exposed when we began working remotely. For many leaders, they see these processes as costing money and an inefficient use of staff. Others see it as an opportunity to innovate and come out on the other side stronger. As Gartner recommends, “Don’t let a good crisis go to waste.” You may have opportunities to apply that advice on either side of O2C and P2P cycles.

It is said that in times of crisis, cash is king.

With COVID-19 still casting its rather ominous shadow over the business landscape, it would appear that these words are undeniably pertinent as we enter Q4 2020.

The last seven months have forced companies to do more than simply adjust to remote workforces. Virtually all CFOs and COOs have had to reexamine their pre-pandemic strategies — specifically, shifting their focus to protecting the financial health of the organization at all costs. A large part of which requires minimizing the common supply chain disruptions that all too often negatively affect working capital.   

Now, similar to the Great Recession of 2009, this moment represents a unique opportunity for many companies to seize or sustain a significant competitive edge or risk damaging their financial health across the supply chain.

Rethinking the Supply Chain

Traditionally, turning inventory has occupied the top spot of most supply chain leaders’ to-do lists. However, due to ongoing economic instability and uncertainty, more and more of them are being asked to focus their attention on activities such as minimizing the amount of money tied up in inventory as well as the money held up in other parts of the organization.

This has resulted in a shift of mindset — thinking of the supply chain, not as a construct made up of disparate parts, but as something more holistic where every process has to work in concert to achieve a common goal.

Within order management, for example, incorrect or incomplete orders slow down order entry cycle time and on-time deliveries which, in turn, impacts cash collection and cash flow. One weak link within processes such as accounts payable (AP), order management or accounts receivable (AR) can make all the difference.

Automation: More Than Just Another Technology

Document process automation has been around for decades. However, while it’s often regarded as a “down the road” aspiration for businesses looking to save time and money, it is quickly becoming a necessary solution for maintaining a successful and sustainable business model thanks to its much broader and more transformational impact. Intuitive cloud-based platforms, such as the one Esker offers, help today’s businesses connect every part of the procure-to-pay (P2P) and order-to-cash (O2C) process.

By creating a collaborative environment of end-to-end efficiency, companies can shore up back-office activities such as paying bills, processing orders and collecting cash, while transforming the way customers and suppliers interact within your organization.

Automation solutions give supply chain leaders an added level of intelligence over the people, processes and technology that constitute their day-to-day operations. Powered by RPA- and AI-driven technology, users have the ability to:

• Coordinate the entire cash conversion cycle — from P2P to O2C — through a single platform
• Perform critical P2P and O2C tasks in real time thanks to end-to-end connectivity between all applications
• Oversee live KPIs, individual or team performances, and the lifecycles of orders and invoices — with customizable dashboards and reporting
• Automate all documents regardless of format, language or transmission method
• Manage local specificities via support of multi-languages, multi-currencies & local compliance requirements

Cash flow is the lifeblood of a business — ready to learn more about the benefits of automation? Esker has you covered. Check out our latest educational eBook, Supply Chain Automation: Optimizing Cash Flow in the Age of Uncertainty.

Customer service shouldn’t be conditional — if a customer is involved in any capacity, providing an optimal customer experience should be a top priority. Yes, that includes the often-taxing collections processes.  

Customer service doesn’t stop when companies are dealing with outstanding customer accounts. When it comes to the collections process, companies that remain focused on delivering exceptional service, having honest and consistent communication, and treating every customer with respect — regardless of what invoices are due — will set themselves apart. Bain & Company reported that businesses can grow revenues 4% to 8% above their market when they prioritize providing a better customer experience.

Businesses can — and must —provide excellent customer service, even during the collections process. Here are three keys to delivering a quality experience.

Be easy to do business with

Whether escalating outstanding accounts to third-party collections agencies or managing receivables in-house, AR teams must emphasize customer experience throughout the entire collections process. The collector’s ability to sensitively work with customers’ accounts payable (AP) teams to navigate difficult financial periods while recovering what’s owed can set the tone for a lasting relationship. 

One way businesses can improve customer experience is by providing an online self-service tool where customers can easily access copies of invoices, view statements, provide supporting documentation for disputes, request payment plans, apply credits, make payments and more. Dunning communication and interactions with collectors can be captured and viewable for customers in an online portal, so expectations for what’s due and when is front of mind. But the main reason to have a customer self-service portal is that your customers expect it — instead of simply being “nice to have”, it’s now required to meet customer standards.

A self-service portal is not, however, a replacement for providing traditional customer support or the ability for customers to speak with a real person in an AR department. A self-service portal should be part of a larger customer service strategy that allows for a seamless omnichannel experience. Core Health & Fitness improved customer experience and had a 30% increase in collections after automating. Read their story here.

Refine your strategy

If it’s been a while since an organization has reviewed its collections process, AR leaders should carefully analyze credit policies and collections team structure, and ensure that collectors have the right customer segments and priorities. Some customers require far more work and focus — this is the perfect opportunity to re-assign customers or regions based on collections team performance and cash-collection rates. Take time to investigate low-hanging fruit: Is there any way you can provide a more effective customer experience and collect payments quicker by offering early pay discounts, further extending payment plans or accepting credit cards for your customers? 

Another means to emphasize service is tailoring payment reminder communications according to customer segments and demographics, and revisiting strategies and messaging to make sure customers are being reached in the right way. Millennial AP staff might want to communicate through email and chat messaging, while other customers may feel more comfortable with speaking to a person on the phone. Read LinPepCo’s customer success story to learn how it significantly reduced DSO and virtually eliminated customers in the 90-day-past-due category by setting up autopay.

Be flexible if you can

Remember that there’s life after collections; the customer relationship doesn’t end after the debt is recovered. Customer experience needs to be a priority from the first collections message sent, to even after the debt has been paid. Most are aware of the concept “bad things happen to good people”, and it’s imperative to understand that this applies to businesses as well.

Life happens. Worldwide pandemics happen. There can be extenuating circumstances that negatively impact customers and create financial burdens. Financial downturns can have a severe and lingering impact, even on customers who have faithfully made payments to businesses for years. Be a problem-solver that’s there to help the customer. Enterprises must see the situation for what it usually is — a hiccup in an otherwise good customer’s financial life that requires additional support, flexibility and patience to help get them back on track. 

There is just no substitute for a customer base that remains loyal, even when having to collect an outstanding debt. Businesses that commit to providing the best possible customer experience, delivering a great experience, and educating and advocating for customers will benefit from rich dividends well after their customers’ financial troubles subside.

“What we see in companies that are doing really well is that they’re trying to be easy to deal with for both their suppliers and their customers.”

– Dan Reeve, Director of Sales and Business Development at Esker

As companies continue striving to maintain and/or achieve efficiency in times deeply affected by global business disruption, the main focus of many business leaders has shifted to the order-to-cash (O2C) cycle. In a lot of cases, invoices were still being managed in manual, paper-based environments — until the pandemic sent most office workers home, that is. Now accounts payable (AP) and order management are high priority for digitization, and companies are quickly learning that the systems they currently have in place aren’t designed to accomplish what they need now and in the future.

Esker’s Director of Sales and Business Development, Dan Reeve, recently sat down to talk with Scott Luton and Greg White from Supply Chain Now for an in-depth conversation about increasing supply chain visibility and cash flow, and the people, technologies, best practices and critical issues affecting O2C efficiency today. Listen to their discussion to discover how companies that are successfully improving their efficiency are doing it without disrupting neither their customers nor suppliers, and where in the O2C cycle AI-driven automation like Esker can be implemented to make the overall process smarter and more effective for businesses.

You’ll learn proven tips and strategies for unlocking new value and visibility in O2C cycles to improve cash flow in tough times, and hear Dan’s expert advice/answers on hard-hitting questions, such as:

1. What is the O2C cycle, and why is it such a priority?
2. How does enabling visibility in procure-to-pay (P2P) and O2C cycles help organizations and influence a supply chain leader’s decision to take action?
3. What bottlenecks are popping up in different stages of the O2C process that really disrupt a company’s supply chain and other aspects of the organization?
4. Is there anything business leaders are overlooking when they look to move at the speed of 2020 and beyond?
5. What do you see finance and supply chain leaders doing to compensate for/correct or protect themselves and their organizations in times like this?
6. Are there particular things/features leaders are looking for in an O2C solution that can help mitigate risk?
7. What are some things supply chain leaders should look out for as they evaluate O2C automation solutions?

Right now, cash flow management and emerging technologies are at the top of many C-level priority lists, and AI-driven O2C automation has the ability to combine them so supply chain leaders can achieve greater efficiency that still meets overall business needs, such as:

• Uniting people and processes to improve collaboration
• Streamlining payment and cash flow to bolster bottom lines, even in difficult times
• Improving experiences for both customers and customer-facing staff
• Creating new revenue opportunities to promote future profitability
• Enabling workplace flexibility to allow for seamless operation should business disruption occur

Listen to the episode now and learn how to create a highly efficient and future-proof O2C operation.

 Positive cash flow is what keeps businesses running smoothly, leaving it up to collections management to turn money that’s owed into money in the bank. Sounds easy, right? Not so much.

Many AR departments continue to rely on manual methods in the collections process. From sticky note reminders about contacting a customer to enormous Excel spreadsheets containing customer information. If only there was a way to automate the parts that should be automated while giving your team a clear view of daily tasks, KPIs, and everything else they need to do their job efficiently.

That’s where Esker steps in. This video explains how a cloud-based automation solution connects with your current accounting system to help your collections management team work smarter, not harder. Check it out and let us know what you think in the comments below!

In a perfect world, when someone owes you money, they pay you. No questions asked, no hassles necessary — what’s owed is paid in full and on time.

Unfortunately, we all know that world doesn’t exist.  

Despite the fact that the global economy is recovering ever-so-slowly from 2020’s COVID-related chaos, companies that continue to be pinched by financial difficulties are, predictably, doing whatever they can to conserve cash — including paying late or not at all.

In other words, the ongoing crisis has exacerbated a problem that had already existed for AR departments. Worse yet, the longer a B2B account sits delinquent, the less probability it will be fully collected.  

So, what’s a business to do? It can be a struggle to nudge slow-paying customers without coming across as aggressive or rude. On the other hand, your company is beholden to cashflow just as any other and unpaid invoices should be viewed as a threat to your business.

Why Collections Messaging Matters

There is no shortage of tactics to help facilitate the collections process. However, success often comes down to one elemental factor — communication. A strong partnership with your customer’s AP department can make all the difference. Ensuring proactive communication should always include:

• Monthly review of outstanding invoices
• Discussion of disputed invoices
• Action plan to resolve disputed invoices

8 Email Tips

In addition to the three strategies mentioned above, below are eight simple tips to get the most bang for your buck when it comes to collections messaging:

1. Be strategic. Emails are more effective when addressed to a specific individual rather than a list or group. Make sure you’re talking to a person capable of handling your request!
2. Be specific. Clearly state the action you want the customer to take, excluding any irrelevant or potentially confusing information.
3. Be professional. Place just as just emphasis on the look and feel of an email as you would spelling, grammar, tone, etc. If including logos, they should be clear and formatted correctly.
4. Be proactive. Some customers use delaying tactics to stall for time (e.g., asking for invoice copies, payment history, etc.). Don’t give them the opportunity — anticipate potential questions/requests and provide all the necessary details upfront.
5. Be timely. This means not only sending your emails at a time when you’re most likely to get a response, but also setting a timeframe for a response. Let them know the actions you “may have no choice but to make” if they do not respond.
6. Be accessible. Make it easy for them to connect with you if they do have legitimate questions or concerns.
7. Be tactful. Don’t be shy about escalating an issue if and when the time comes. Attach previous correspondence and documentation to support your decision.
8. Be direct. What payment forms do you accept? Where should remittance go? To avoid questions such as these, tell your customers exactly where and how to send payment. This sounds basic, but can save so much time and confusion!

Want to learn more about these tips and optimizing collection correspondence? Watch this 20-minute on-demand webinar hosted by Esker’s Bri Maas, as she lays out just what AR leaders need to beat the winter blues and heat up their collections strategies!