3 Can’t-Miss Best Practices for A/R Automation

Jared King Avatar
Jared King
Photo credit: EduBirdie.com

Automation has impacted business at all levels, bringing with it efficiency, scalability and change. And automation technologies - whether deployed for industrial manufacturing or financial data analysis - have completely changed how many businesses operate.

The same is true of accounts receivable management. What used to be time-intensive manual processes can now be set up one and never touched again. Invoicing, chasing and accounts receivable management can be done easily and, well, automatically. Human errors are reduced and, often, customer service is increased.

That doesn’t mean that there aren’t guidelines to follow. There are tasks that should definitely be done electronically and some that would be more effective with a human touch. There are considerations with combining legacy systems with new platforms.

Automation can make a material impact on your organization, but it should be done with a mindful approach. There are many best practices for implementing automation for accounts receivable management. But if you want to maximize success, these are the three that stand out as can’t miss:


Prioritize the Customer Experience

One very customer-oriented benefit that accounts receivable automation often delivers is a customer payment portal, which allows users to access and manage their billing relationship at their convenience, 24 hours a day and 7 days a week. A modern, well-designed and capable portal allows customers to do business how they want to. If you’re going to embrace automation, customer payment portals are a requirement, and they have to be done right.

While it’s impossible to guarantee that all customers will pay all accounts on time, you can make it vastly more likely by removing as much friction as you can. A single-screen experience that allows you to onboard, service and help retain clients is a win-win for all parties.

Customer payment portals also allow you to better report on how effective your accounts receivable management process is. It helps you to easily compile data and report out on where your organization stands.


Decide What Should be Automatedand What Shouldn’t

Automating can replace many manual tasks, but shouldn’t replace all of them. There are standard parts of the automation process like subscription billing, payment processing and reporting that are absolutely appropriate for automation.

Some things require a human touch, however. There are parts of the chasing process that require a personalized email or even a phone call. If there’s a customer that has been with you for a significant amount of time that is suddenly having difficulties making regular payments, an impersonal reminder about late fees probably isn’t the best response. Instead, value that relationship by touching base personally to find out what the issue is. It may speed up the payment process or ensure that they remain a customer.

You should also reconsider automating any process that includes a sales component - such as checking in with a new customer shortly after they’ve started using your product. Like the above example, that involves relationship building.


Prepare your Organization for Structural Change

Humans are naturally resistant to change. We like stability, dislike upsetting that and embrace being creatures of habit. Introducing automated billing and invoicing is a significant disruption of “how we’ve always done things.”

Organizational change is hard, even if the new process will reduce the burden of your employees. They should be part of the process early and get them trained well before launch. Give them a sense of ownership in this new process and let them have a say in how to best execute it.

Don’t execute a full automation effort on day one, either. Start with a single process as a sort of pilot program to start. It will be easier in your staff, reduce the opportunities for mistakes and be better for your customers.

Speaking of customers, they’ll need to be included in this process as well. Consider a limited launch of your new automated process with select customers to limit potential damage from mistakes and to solicit feedback on what works and what doesn’t. 

There’s also potential issues with incorporating new technology with the old. There are countless platform currently in use - from bespoke solutions that still run in DOS to more sophisticated options running on the cloud. 

Embracing automation is an increasingly inescapable - but still stressful - change. However, the benefits in productivity, customer satisfaction and the bottom line make it a necessary part of a modern business. By being mindful of where you should place your focus, you can make the transition seamless, for your business and customers.

Jared King Avatar
Jared King

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