Situation
A business was experiencing a high percentage of past due invoices and needed help streamlining their workflow. With three different ERP systems, the business built up an accounts receivable backlog that included a high number of disputed invoices. The processes they were using were inefficient and resulted in collection disputes.
Actions
- Implemented AR management system to standardize and automate the workflow.
- Created new common collection strategies.
- Partnered with the client to redesign the dispute management process. Cutting down on lead time providing clear resolution paths.
- Created means for higher visibility through better reporting tools.
- Helped client to standardize processes in terms of implementing prioritization logic with a focus on top accounts, payment term enforcements, payment histories, etc.
- Helped client establish a credit hold procedure.
Results
MetaExpert helped re-engineer the entire collection process, automating the workflow and establishing a clear dispute management approach. An escalation metric was also implemented for issues of title control.
MetaExpert worked to streamline the workflow, which reduced the high percentage of past-due invoices.
Return on Investment
$15 M worth of cash flow was released, decreasing the average monthly past due amount by approximately 20%. This resulted in around $1.15M in interest savings.
ROI(corporate finance) the amount, expressed as a percentage, that is earned on a company's total capital calculated by dividing the total capital into earnings before interest, taxes, or dividends are paid.