CM September 2021

ROUND TABLE
TAKING ORDERS
David Popper and Jenny Chu of HighRadius were joined
by the CICM’s John Kane FCICM to discuss the importance
of automation in the Order-to-cash (O2C) process.
PERHAPS obviously, Orderto-cash
(O2C) refers
to a company’s order
processing system, from
sales (the ‘order’) right
through to customer
payments (the ‘cash’). By optimising
this process, companies are able to
eliminate inefficiencies and enhance the
performance across the entire business.
Automation has, for a long time, been
seen as the key to process optimisation,
and COVID-19 has helped to accelerate
the speed with which automation has
been adopted.
David Popper, Digital Transformation
Lead EMEA at HighRadius, makes the
point: “Pre-2020, many companies had
digitisation on the road map though this
was still some way away. But with cashflow
taking such a hit over the last 18 months
and recognising the role that automation
can play in supporting a healthier
cashflow, organisations are accelerating
their adoption of O2C technology.”
Having been an early adopter of cloudbased
systems, HighRadius uses Artificial
Intelligence (AI) to increase O2C efficiency
with technology that serves more than 600
customers in various sectors.
THE BENEFITS OF AUTOMATION
Automation can deliver significant
benefits. On a basic level, it streamlines
operations and frees up time that
would otherwise be spent on manual,
administrative-related tasks. But the
benefits go beyond this. David Popper
outlines six examples to show the impact
of technology on the accounts receivable
function:
1. PROACTIVE RISK MONITORING
AND REAL-TIME BANKRUPTCY
ALERTS:
With unlimited access to customer credit
reports, credit teams can track changes to
a customer’s credit risk in real time. Using
AI and up-to-date metrics bears greater
significance in the midst of the pandemic,
where many company records are now
outdated and fail to reflect their current
financial position.
2. PRODUCTIVITY IMPROVEMENTS
WITH AI-POWERED COLLECTION
EFFORTS:
Automated reminders are sent to
customers ahead of their scheduled
payment date, freeing credit team
members for the more pressing tasks
and the more challenging customers.
HighRadius’ technology also provides a
daily plan, ordering tasks by a matter of
urgency, so teams can spend more time
‘doing’ rather than planning.
3. INVALID DISPUTE IDENTIFIER:
This tool is said to provide four times
better recovery rates. It asks the question
of whether a customer is delaying
payment because of a genuine dispute
that needs to be addressed. If this is the
case, credit managers are able to focus
on resolving the problem, rather than
wasting their time chasing debts that
cannot yet be paid.
4. CASH APPLICATION:
This process of matching a customer
payment to an invoice is a crucial part of
the accounts receivable system. AI enables
cash to be applied before collectors start
their day, so collectors are freed from the
task of contacting customers. HighRadius’
software provides a 95 percent straightthrough
cash posting rate.
5. CUSTOMER-CENTRIC PAYMENT
PORTALS:
For small and medium sized businesses,
there is often one person responsible for a
variety of roles, and when this is the case,
reaching out as a collector often doesn’t
work. By providing a payment portal,
customers can pay how and when it suits
them, enhancing their overall experience
and increasing the likelihood of receiving
payment.
6. MORE VISIBILITY OVER THE
WHOLE O2C PROCESS:
AI enables scenario-based reporting,
so that cash collection can be predicted
across a range of circumstances.
John Kane FCICM, Head of Strategic
Partnerships at the Chartered Institute
of Credit Management (CICM), says that
the HighRadius system also provides
both top level and specific overviews:
“Automation provides a bird’s eye view on
how a company is performing, but it also
gets down into the details, for example if
a company is performing badly, it allows
you to identify why this is the case.”
BENEFITS IN PRACTICE
Clearly, there are a range of benefits that
can be gained from automated processes,
but looking at a credit team that has
adopted these O2C technologies provides
a clearer indication of the advantages that
automation holds.
Jenny Chu, Regional Marketing
Manager EMEA at HighRadius, cites
the example of Sanofi – a French
pharmaceutical company with a global
outreach. HighRadius worked with
them to achieve 100 percent operation
excellence.
The company, which is present in 170
countries, had a poor cash conversion
rate due to poorly organised and manual
processes, as well as a lack of inter-team
visibility which made it harder to monitor
accounts and make smart decisions.
With the aim of creating better
executive visibility, improved operational
efficiency and to use a single model across
its entire cash collecting community,
Sanofi chose the HighRadius cash
application solution.
“We helped integrate our cloud solution
with their existing enterprise resource
planning (ERP) system across the world,”
Jenny explains. “This has resulted in
better visibility for senior management
and enabled 48 percent of payments to be
managed automatically after one year and
a 50 percent reduction in workload thanks
to a focus on high impact jobs.”
All of this is not to say that the role of the
credit manager is over, rather automation
is enhancing the efficiency of credit
teams: “Technology can undoubtedly
support businesses, but it cannot replace
credit teams,” John continues.
“When we talk about efficiencies, we
do not mean reductions in staff. Instead it
is about maximising the time credit teams
can spend working on the tasks that are
most pressing and of the highest value.
Essentially, automation allows credit
managers to do what they do best.”
Advancing the credit profession / www.cicm.com / September 2021 / PAGE 58