Cash Is King, but Not at All Costs, Right?

This article is sponsored by BlackLine. Unified AR?solutions can help improve the financial health of your business. You can go here to download a whitepaper from Institute of Finance and Management showcasing the benefits of employing intelligent solutions in your collections process.?

We all know the saying “cash is king” because, without it, companies wouldn’t be able to function. However, using this notion as your governing thought could lead to potentially irrational behavior, at least in the long term. Why is that??

If you care about cash before anything else in the company, you might take action against customers to collect your cash that damages your relationships. It could be to a point where said customers don’t want to do business with you again. Of course, not all customers are good customers, but before there is cash there are customers. In other words, without customers, there is no cash.?

Hence, when designing your collections process, you need to carefully consider how it will impact the customer experience. Don’t get me wrong—customers need to pay what they owe you. But you would like the customer to come back, at least if you run a more transactional heavy business.?

That said, there may not need to be a contradiction between running an optimized collections process and having happy customers at the same time. In fact, the collections process could help make your customers even more satisfied with your products and services. Let’s explore that point further.?

Integrating All Invoice-to-Cash Applications?

One of the major challenges with the typical collections process is that companies have split the process into multiple parts, such as invoicing, collections, credit monitoring, and disputes resolution, just to mention a few. When different teams are responsible for different sub-processes, companies risk that their customers will experience multiple touchpoints during the collections process. This creates frustration and gives the impression that you are difficult to do business with.?

Therefore, it is critical that companies unify all these processes into a single platform. This ensures that even if multiple teams are involved, there is one touchpoint for the customer and one platform to manage all tasks related to the collections process. Apart from unifying all processes on one platform, you also get additional benefits such as:?

• Increased opportunities for automation since you now have the entire process on one platform. You can move on from single process-step RPA solutions to more intelligent automation solutions that consider the entire process and use machine learning alongside analytics to understand customer behaviors.
• Better reporting and dashboard capabilities enable you to avoid suboptimization through different teams only looking at their own KPIs. You can also take a more holistic approach to a customer and any process inefficiencies you might uncover while generating insights that can improve decision-making.
• Intelligent workflows optimize task management and ensure that customers get a seamless experience when encountering your collections process.
• Scalable and secure solutions help avoid manual and error-prone Excel sheets and reduce exposure to phishing emails and other scam attempts.

You will quickly be able to reap some of the tangible benefits and at large reduce DSO while giving customers a better experience doing business with you.?

Denouncing the False Choice Between Cash and Customer Experience?

If you ever felt you had to make a choice between a good customer experience and collecting cash, let’s denounce this false choice once and for all. It is possible to achieve both at the same time. It requires that you unify your collections process and ensure that customers only have one touchpoint with your process—regardless of if they’re being invoiced or submitting a dispute.?

By taking a customer-centric approach in your collections process, you will create a win-win situation—cash collected faster and happier customers. You may also discover added benefits from generating enriched insights about customer behaviors and how you can properly price your products and services by taking this into account.?

How does your collections process work today and what are your customers saying about it? Is it a pain point or a non-issue? How are you utilizing cloud-based tools in the process? These are important questions to answer and hopefully, you will also see the potential for improvement. What’s the next step in improving your process??

You can go here to download a whitepaper from Institute of Finance and Management showcasing the benefits of employing intelligent solutions in your collections process.

You can read previous articles and posts from my collaboration with Blackline below:

• What would you do with 20% extra time?
• A Week In The Life Of An Accountant Post Finance Transformation
• Intercompany accounting headaches
• 4 Best Practices To Achieve Intercompany Accounting Excellence
• Cash in bank = cash in hand, right?
• Your post-transformation plan
• The trillion-dollar opportunity
• The Technology-Enabled Accounting Team of the Future
• Automating the AR process
• How To Drive Value Creation With Automated Cash Application
• How To Automate Accounts Receivables
• What does it take to create a good customer experience?

You can read a lot more articles about FP&A, Business Partnering, and Finance Transformation below. It all start's with “Introducing The Finance Transformation Nine Box”?where you set the ambition for your transformation. You should join the?Finance Business Partner Forum?which is part of Business Partnering Institute's online community where we will continue to discuss this topic and you can click here to follow me on?Twitter.

8 Changes For FP&A To Make To Transform Strategy?(part of a ten-article series about FP&As involvement in the strategy process)

An Open Letter To The CFO: Are You Ready To Transform FP&A?

The Future of FP&A – Two Ways To Take the Reins

All Successful Business Partners Are "Leaders"?(part of a five-article series where we unfold our business partnering capability model)

Should We Keep Talking About Business Partnering??(part of a 17-article series where we deep-dive on our business partnering framework "BP on a Formula")

How To Create Value Through Business Partnering

Everyone Can Adopt A Business Partnering Mindset?(part of a six-article series about FP&A Business Partnering)

From Business Partner To Working Within The Business?(part of an article series where I interview finance professionals about their careers in FP&A and Business Partnering)

Is Your Product Optimized For Value Creation??(part of a toolbox series where we look at what tools FP&A professionals should leverage to drive value creation)

How Business Partners Turn Analysis To Insight?(part of case study series where I interview business partners about how they drive value creation using real cases)

What Defines A Finance Master?

The New Career Path For Finance Professionals

How Finance People Can Be More Successful

The CFOs Roadmap To Transforming Finance

How To Become A Finance Business Partner

Financial Analyst vs. Finance Business Partner

You’re A Finance Business Partner, Now What?

Building A Team Of Finance Business Partners

Anders Liu-Lindberg?is the co-founder and a partner at the?Business Partnering Institute?and owner of the largest?group dedicated to Finance Business Partnering?on LinkedIn with more than 10,000 members. I have ten years of experience as a business partner at the global transport and logistics company?Maersk. I am the co-author of the book “Create Value as a Finance Business Partner” and a?long-time Finance Blogger?on LinkedIn with close to 65.000 followers and 140.000+ subscribers to my blog. Recently I became an advisory board member at?Born Capital?to help identify and grow the next big thing in #CFOTech.