BlackLine Blog

March 17, 2021

Why Automating Accounts Receivable Is a No Brainer & Time Is the New Currency

Modern Accounting
4 Minute Read

Brian Morgan

Share Article

It’s Time to Automate Your Accounts Receivable Process

The purpose of credit is to generate sales, which are then provided on the trust that payment will be received at an agreed time. Once the payment is received, the sale is fulfilled and can be released as profit—and cash is in the bank.

Institutions have varied and different challenges, but one constant is that cash is critical. In a recent report by PwC, “64% of respondents noted they have an increased focus on working capital management.”

At a time when cash won’t be as free-flowing as in recent times, the management of cash, the need for working capital, and the realization of profits are now at the forefront for all business leaders.

Therefore, who in Finance or Accounts Receivable doesn’t want to have more time to collect cash from sales and manage the risk of providing credit to generate sales?

More cash? More time? No brainer.

A Catalyst for Change

Sometimes we get stuck in doing what we have always done, usually because we are so busy. I mean, who isn’t busy with endless video conference calls and balancing the books, educating their children, and life?

Throughout 2020, our working practices and where we perform our duties have changed beyond what we might have expected at the start of last year.

Credit and finance professionals have been forced to review how they perform certain processes and the tasks involved. Cash application has certainly been one of the areas in the spotlight as electronic payments have increased and replaced checks.

While it’s always good to have the money in the bank, this has caused a knock-on effect on the application of payments, as the remittance for the payment has been lost in transit or is in someone’s inbox—who may be furloughed or no longer with the department.

This results in an increasing amount of unapplied cash and an increase in the amount of re-work required to complete the reconciliation. This ultimately impacts the visibility into the debt that’s outstanding for the credit controllers to collect, and consuming time that AR teams would prefer to use engaging with customers.

Suddenly, the need for quick and accurate cash application is crucial. The need for visibility into each and every sales ledger account also increases in order to show real-time debtor positions.

This proves that now is the time for intelligent automation of the cash application process, and we think it’s also time that processing customer payments is not only maintained but improved.

The Age-Old Excuse: I’ll Do It Tomorrow

McKinsey’s latest report on introducing the next generation of operating model cites that “as much as 45% of employee activities can be automated by adapting current technologies. That is calling into question how businesses work, build skills, and deliver customer experiences.”

But research tells us that less than 20% of finance transformation projects have been completed and some 40% haven’t got past first base! People usually put things off because of fear of failure or lack of confidence.

The good news is that you can learn from the experience of others.

Imagine if you could see other institutions in your industry or similar businesses and learn how implementing automated cash application has positively impacted their college or university. Has it been a catalyst for significant improvement?

Now think about applying it to your own institution. Do you feel more confident and assured that the project would be a success?

The good news is you don’t have to imagine it. Talk to fellow peers who have improved their efficiency of the cash application process. Understand who has increased their automation levels above 70%. These are institutions with world-class automation that you can learn from.

Achieve ROI in 12 Weeks

One of the obstacles to overcome is that too many of us have been involved in too many projects that have gone over the promised time frame and budget. Harvard Business Review reports that “of the $1.3 trillion spent on digital transformation in 2018, an estimated $900 billion was wasted when initiatives didn’t meet their goals.”

Now, for the good news.

We deploy BlackLine Cash Application using our Rapid Time to Value model with clear, concise, and focused outcomes so that our customers can realize their business case in a matter of weeks. Because we want you to start benefiting from automation as quickly as possible, we provide peace of mind, with ROI in just 12 weeks.

Who wouldn’t want to say goodbye to chasing customers for remittances instead of having a conversation about the next order and/or payment?

BlackLine Cash is a no-brainer.

Time Is Precious & Valuable

Where are you going to spend your time and your credit team’s time? Continually fighting the clock doing what you do today? Or are you going to invest some time into transforming the Order to Cash process and create time for you and your team?

Intelligent automation of the cash application process is not just about deploying robotic process automation to eliminate manual tasks, but it is about shrinking the processing time and manual effort by layering machine learning to reduce the tasks required.

BlackLine AR has a strong track record from hundreds of customers who have benefited from increased efficiency by moving from manual processing to intelligent automation, enabling their credit team to focus on value-added activities, and maximizing their time to collect cash. Now, it’s time for you to take action.

Be Ready, Be Resilient

Change has happened, and change will continue. We can be sure about that. We know things will not return to ‘normal,’ but we don’t know what the future will look like.

So, now is the time to be resilient and put changes in place that will improve your performance in both efficiency and effectiveness today, and also make you resilient for the challenging times we face ahead.

Intelligent accounts receivable, starting with the automation of cash allocation, is now a no-brainer.

Now Is the Time

Making the investment in automating cash application will reap benefits and pay for itself in a short amount of time, in terms of direct costs, adding value, and impacting your AR department in many ways.

Improve your visibility of customer indebtedness and ensure your credit team is spending time on value-added tasks that deliver results.

Ready to get started with automating your cash application process? You can learn more here.

About the Author


Brian Morgan