Blog | Netsend http://netsend.com e-invoicing and e-billing solutions for business Mon, 15 Jan 2018 14:17:50 +0000 en-GB hourly 1 http://netsend.com/wp-content/uploads/2016/10/cropped-Netsend_Stacked_CMYK_square-1-32x32.png Blog | Netsend http://netsend.com 32 32 eIDAS and Changes to Electronic Signature Legislation http://netsend.com/blog/eidas-changes-electronic-signature-legislation/ Thu, 11 Jan 2018 11:36:45 +0000 http://netsend.com/?p=3494 The post eIDAS and Changes to Electronic Signature Legislation appeared first on Netsend.

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Electronic signatures are widely used by businesses today.  It’s remarkable to think that they were only granted the same legal weight as their ‘wet ink’ counterparts from 1st July 2016 (in Europe).  Legislation around electronic signatures and associated ‘trust services’ continues to evolve, with the eIDAS (electronic IDentification, Authentication and trust Services) Regulation – Regulation (EU) No 910/2014 of the European Parliament and of the Council – providing an update to legislation across the EU.

The new eIDAS regulation has consolidated and replaced a confusing patchwork of laws pertaining to electronic signatures, making them consistent across every EU country.  With electronic signatures used to sign international documents, the eIDAS regulation ensures all parties produce and receive signatures that are legally binding.

eIDAS updates the original Electronic Signatures Directive (Directive 1999/93/EC), setting out a legal framework to enable mutual recognition of electronic identification systems between Member States, and establishes trust services that can be used to support, or in place of, electronic signatures.

For a more detailed explanation of how eIDAS changes existing legislation, take a look at our Trust Services for Electronic Documents white paper.  This blog post explains some of the key points to consider.

“The new eIDAS regulation replaces previous electronic signature laws and is now consistent across every EU country”

 

eIDAS Changes to Electronic Signatures

Previously, electronic signatures could be used by both individuals and by corporate organisations.  eIDAS updates this to make a distinction between natural and legal persons, requiring that an electronic signature relates to an individual – not an organisation – henceforth.  This change switches the onus on to individual responsibility, ensuring greater awareness of the legal responsibility of those applying signatures as part of automated processes.

 

eIDAS Changes to Advanced Electronic Signatures

eIDAS redefines Advanced Electronic Signatures to allow for mobile technology to form part of the identification and authorisation process – through connection to a Certificate Authority for the issuance of a digital certificate.

 

eIDAS Changes to Qualified Electronic Signatures

Qualified Electronic Signatures (QES) are an extension of the concept of Advanced Electronic Signatures.  QES are only possible to create from a qualified electronic signature creation device (SSCD) – which must store the signature creation data.  Such a device is qualified by issuance of a Qualified Certificate, from a qualified trust service provider.  In turn, a qualified trust service provider is granted such status by the Supervisory Body.

The electronic signature creation device provides a level of security above and beyond an Advanced Electronic Signature, which is appropriate in certain scenarios.

 

What are Trust Services?

Trust services are introduced, as a concept, via eIDAS to provide additional routes to verify integrity of document content and sender.  eIDAS sets out a legislative framework to put these services into practice in the EU.

Electronic Seals

As part of these changes, eIDAS introduces the concept of electronic seals.  Electronic seals are similar to electronic signatures, but only available to legal persons (rather than natural persons) – such as corporate entities.  These provide a route for corporate entity to apply a stamp of authentication to a document, without the fine-grained individual responsibility implicit in an electronic signature.

As the name suggests, an electronic seal works a little like its traditional, physical, counterpart.  The seal guarantees that the contents of the document has not been tampered with, as well as guaranteeing the authenticity of the sender.

Time Stamps

Time stamps are used to verify that the data contained in the document existed, and remains unchanged from, the data at the time and date of the stamp.  This is particularly useful to anchor documents, such as contracts or bills, to a time and date.

Delivery Service

The Electronic registered delivery service prevents risk of loss, theft, leakage or alteration of documents being sent from one party to another.  The service also provides evidence of receipt and proof of delivery.

Website Authentication

Website authentication, by way of electronic certificate added to the site, validates the authenticity of the site and link to entity or person(s) owning the site.

 

The Business Benefits of eIDAS

In the competitive and fast-paced world of business, capitalising on changing legislation provides a competitive edge.  Working with an expert partner, such as Netsend, enables your business to quickly offer the benefits of trust services and the full range of electronic signature types to your customers.

Whether incorporating the latest changes from eIDAS within internal document distribution processes, or as a way to improve security and assurance with partners and customers, these recent changes make document transactions more secure than ever before.

Move beyond the benefits of simple electronic signatures and turn trust services to your business advantage.

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How to beat the Christmas Post (with electronic delivery) http://netsend.com/blog/beat-christmas-post-electronic-delivery/ Wed, 13 Dec 2017 16:15:03 +0000 http://netsend.com/?p=2257 It’s the time of year to be jolly… but actually, when you’re trying to get important documents over to clients, you might be feeling a little less jolly.  The infamous Christmas Post has a lot to answer for.  As millions of cards and presents enter the system for just a few weeks, this throws delivery […]

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It’s the time of year to be jolly… but actually, when you’re trying to get important documents over to clients, you might be feeling a little less jolly.  The infamous Christmas Post has a lot to answer for.  As millions of cards and presents enter the system for just a few weeks, this throws delivery timescales into disarray.

Have you ever tried to get a document to a client urgently on the lead up to Christmas?  What normally takes a couple of days can take weeks.  That level of uncertainty and delay is a problem when waiting for signed documents, and can lead to significant cashflow impact when invoices and payments are directly affected.

With the volume of post increasing massively on the lead up to Christmas (up to 10 million parcels per day at its peak), it’s simply too much for the infrastructure to handle effectively.  This resulted in 4.8 million reported delivery problems over the Xmas period in 2015.  Last year saw £148 million worth of lost or damaged post this Christmas in the UK. And according to Citizens Advice, online shoppers will typically spend two-and-a-half hours sorting out a delivery problem this Christmas – because an item is late, turns up broken or doesn’t arrive at all.

In a survey carried out in December 2016, more than one in five had a parcel go missing*

A third of consumers who receive a damaged parcel don’t take action. For those that did try to complain, more than 40 per cent ran into problems – such as difficulty contacting the retailer or delivery company on the phone.

So, how can you avoid this as a business?

Electronic Document Distribution – for reliability and speed of delivery

As every Christmas shopper knows, the online world is without the queues and traffic of the high-street.  This is also one of the attractions of electronic document distribution, enabling businesses to send documents swiftly and securely irrespective of season.

Furthermore, electronic documents can be produced and sent automatically.  The paradigm of accounts receivable automation has sprung up in response to the demand for more streamlined and cost effective ways to generate and distribute invoices and other AR documents.

In the context of the accounts receivable department, electronic invoicing is growing at a rate of 20% year on year globally.  It’s not hard to see why, when you consider the value of getting invoices out quickly, as this brings the cash into the business sooner; Christmas post, or not.

Know when your documents arrive

Beyond the simple ability to avoid postal traffic, electronic document distribution systems, such as Netsend, afford the sender insight into how the document distribution is progressing at every step of the journey.  There is enormous value in determining who has actually received time-sensitive documents, and even whether they have opened them and, where appropriate, agreed to the content.

With an electronic document distribution system, it’s possible to see at a glance who has not yet responded to documents.  Reports can be generated for direct follow-up, or statements and/or dunning letters can be generated automatically to nudge slow-responders into action.

You’re not just saving time, but saving money too

Electronic documents are not just the fastest and most secure way to ensure business documents are delivered, they also present a significant cost saving.  Reducing the reliance on print and postage for the distribution of business documents brings paper, stamp and printing costs down considerably.

Many businesses go as far as outsourcing the remaining print and postal requirements to be handled through a single document distribution solution, such as Netsend.  This simplifies the process of distribution, as documents are directed to the distribution system and then either sent electronically (in most instances), or automatically printed and posted for recipients who are yet to convert to accepting electronic format documents.

Save throughout the year and be ready for next Christmas

Businesses making the most effective deployments of electronic document distribution are committed to onboarding as many customers to the new process as possible.  When you consider the average saving of €6.60 per invoice sent electronically, rather than by post, it’s clear that efforts to convert recipients are highly valuable.

At Netsend, we achieve an average conversion of over 80% within 6 months.  The industry standard sits a little lower at 60% after 1 year, but there are many techniques, as well as product nuances that can encourage an audience to convert to electronic documents more quickly.

Get in touch today and find out how quickly you can benefit from electronic document distribution, saving all year round and side-stepping postal strikes and seasonal fluctuations like the Christmas post.

 

*Shock figures reveal how many parcels are lost or damaged

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Business Process Improvement (BPI) http://netsend.com/blog/business-process-improvement-bpi/ Fri, 01 Dec 2017 09:04:35 +0000 http://netsend.com/?p=3421 The post Business Process Improvement (BPI) appeared first on Netsend.

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Business process improvement, or BPI, is an important undertaking in any business – whether as a formal and rigorous process, or as a guiding principle to enhance profitability in a broader sense.

BPI is defined by TechTarget as the following:

“Business process improvement (BPI) is a strategic planning methodology aimed at identifying the operations or employee skills that could be improved to encourage smoother procedures, more efficient workflow and overall business growth. This process can also be referred to as functional process improvement.

 

The purpose of business process improvement is to meet customer demands and business goals more effectively. Rather than drawing out change management in incremental steps, BPI seeks to bring drastic transformation in an organization’s performance. In IT, business process improvement addresses the root causes of process or system deficiencies to harmonize IT and business goals. Process mapping, which assesses business operations to pinpoint problem areas and adjust workflow, is often the first step in a larger business process improvement effort.”

 

Warning signs – the need for Business Process Improvement

Identifying the need for Business process improvement is crucial to maintaining an effective and healthy business.  Whilst BPI could arguably be applied as a continual improvement cycle, there are specific warning signs that show your business needs BPI.

 

Email

Email is central to many business functions, providing a valuable service.  However, overuse of internal email indicates problems with existing processes.  Consider the ideal characteristics of business processes; running smoothly without questions from operators or exceptions to handle.  This would generate very little email – perhaps only the end result of the process; directed towards customers or business partners.

When processes are inefficient, where there are gaps to bridge, poorly handled complexities or lack of support for anomalies, staff resort to email to clarify and handle exceptions.  Improving processes will reduce exceptions, and reduce the reliance on internal emails to seek solutions.  Keep a handle on internal email volumes and address processes that are leading to the generation of these.

 

Extensive training times and/or documentation for processes

Another clear indicator of poor business processes is the abundance of documentation to define them.  This can also be measured by the time taken to train a new employee in the operation of the process.

The less efficient a process, the more explanation is required to run the process effectively.  Keep an eye out for bulging ‘documentation’ files, extensive allocations of time for holiday handover, or long induction cycles.

The less efficient a process, the more explanation is required to run the process effectively.

Working from spreadsheets

Spreadsheets are another important business tool.  However, over-reliance on spreadsheets points to inefficient business processes and the need for BPI.  From an employee’s perspective, spreadsheets bring order to chaos, so the abundance of spreadsheets is an indicator that staff are struggling to bring chaotic (inefficient) processes under their control.

Solid management and review procedures should identify where staff have an over-reliance on spreadsheets to handle processes.  In these instances, you know there’s a wild process to be tamed through BPI.

 

Scalability challenges

It may seem a nice problem to have, but challenges around scalability, due to process inefficiency, come at exactly the wrong time.  Businesses should be agile enough to embrace opportunities to scale, or they risk being locked into a flat level of business, or worse, a decline.

Where a business process is challenging to scale, it implies too much variability and exception handling.  Rigorously defined processes are typically easier to scale than those requiring judgement and experience to select an appropriate solution at any stage.

Check your business can scale if and when needed, where would the bottlenecks lie and how can these be refined and improved before they present a scalability problem?

 

Business Process Improvement – the first steps

Business process mapping is typically the first step to take once processes have been identified in need of business process improvement.  This forms part of good workflow management practice, which also takes into account business process modelling (a more detailed representation of the process in question).

Business processes cannot be improved upon if they are not clearly understood and mapped.

Mapping a business process should start with defining the start and end points of the process, what triggers the process and how does the end point map onto connected processes.  Each task in the process should then be clearly documented with yes/no decision points identified and subsequent loops or branches defined.  Where a process requires a more complex decision, this presents an opportunity to simplify as part of process improvement.

Business processes cannot be improved upon if they are not clearly understood and mapped.  The next step, after mapping, should be modelling – taking into account the full range of variables the process may need to handle.  Feeding example, or live, data into the process model will highlight bottlenecks and uncertainties.  This all sheds important light on the process before moving on to remodelling or reengineering to improve performance.

 

Business Process Improvement through Digital Transformation

Once processes are clearly mapped and modelled, many businesses find opportunities to digitise repetitive and mundane tasks – freeing up human resources to handle more valuable and dynamic workloads.

Various different opportunities exist for digitising processes, from end-to-end outsourcing of the process to a business process outsourcing (BPO) partner, to configuring a robot (program) to replicate the steps taken by a human – robotic process automation (RPA), to integration with an as-a-service solution (SaaS, PaaS or IaaS) to offload some of the process handling to externally hosted solutions.

At Netsend, we offer a fully-integrated solution which replaces many of the mundane and repetitive steps in document creation and distribution, often deployed as an automated e-billing/e-invoicing solution.  This programmatic approach to process automation ensures 100% reliability and removes human error from the equation – something that costs businesses precious time and money when occurring in cashflow sensitive process such as billing.

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How Business Process Outsourcing is Evolving http://netsend.com/blog/business-process-outsourcing-evolving/ Thu, 30 Nov 2017 14:32:37 +0000 http://netsend.com/?p=3394 The post How Business Process Outsourcing is Evolving appeared first on Netsend.

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Business Process Outsourcing (BPO) has evolved considerably as the market has matured.  Some years ago, BPO may have been considered to simply be a way of getting work done cheaply, but now the depth of BPO offerings is far smarter than just offshoring to a low-cost labour force.

 

The decline in Offshoring for BPO

Firstly, let’s address the eternal rumour of the decline in BPO.  Yes, in a number of sectors, and in specific regions, offshoring as an approach to BPO has decreased in popularity.  This is understandable – BPO is now more sophisticated with the automation revolution of RPA (Robotic Process Automation) and greater emphasis on quality, rather than quantity, through the paradigm of KPO (Knowledge Process Outsourcing).

Specific insight into the impact of RPA on the jobs market in India can be seen in recent reports from HfS Research, a US-based business advisory firm.  HfS Research estimates that automation is likely to lead to a 14 per cent decline in India’s IT workforce with 4,80,000 IT jobs at risk by 2021.  As RPA becomes more sophisticated, it is likely to consume an increasing percentage of work outsourced to individuals.

It is estimated that there will be a 14% decline in India’s IT workforce, with 4,80,000 IT jobs at risk by 2021

One region that has experienced a recent decline in work from BPO is the Philippines – with a widely reported 34% fall in investment pledges, from the IT_BPM industry, in the second quarter of 2017.

Offshoring is understandably viewed more cautiously these days, with the increasing awareness of risks from environmental factors – from storms, floods and the like to political and religious unrest.  But what is lost from offshoring is more than readily taken up by the growth in onshore BPO options.

 

The benefits of RPA as a BPO option

Business Process Outsourcing definition

We address the topic of Robotic Process Automation (RPA) in more detail in a separate post, but it’s worth mentioning here how RPA is gathering momentum quickly as it becomes easier to emulate, and improve on, rules-based behaviours via robots running either as part of an in-house system, or via connection to an as-a-Service offering from an expert partner.

With the advent of more sophisticated solutions, via RPA or KPO for example, businesses increasingly consider BPO as a method of improving service, rather than simply reducing costs.

If an outsourced service can reduce errors, provide better analytical insights and complete tasks more quickly, this presents a competitive advantage.

 

BPO to provide insight and advantage

In an increasingly digital world, business decisions are fuelled by analytical insights best gained from electronic systems.  When processes are held in-house on legacy systems, it’s often hard to drill down into performance specifics, or extract broad analytical insights.  BPO service providers are aware of this and strive to deliver valuable, actionable, insights back to the business via a range of analytical tools.

 

Traditional BPO vs. as-a-Service model outsourcing

According to the Information Service Group’s (ISG) latest annual report, the annual contract value (ACV) for traditional IT and business process outsourcing, globally, declined by about 25% – whilst the as-a-Service increased by 38% in the same quarter (Q4 2016).  Within the as-a-Service model, Infrastructure-as-a-Service (IaaS) is seen to outpace Software-as-a-Service (SaaS) by 3 to 1 for ACV.

“The market migration from traditional sourcing to as-as-service sourcing is gaining momentum, as enterprises increasingly embrace the digital opportunity to transform their operations, enhance their engagement with customers and better leverage their connections with suppliers,” said John Keppel, partner and president of ISG.

Whilst globally the trend is towards as-a-Service, this is driven primarily by the dominance of this outsourcing type in the Americas and Asia Pacific regions.  EMEA is seeing an acceleration in growth of as-a-Service outsourcing, but traditional sourcing still constitutes the majority of the ACV for this region.  Rate of change, acceleration of growth, in as-a-Service outsourcing is the key metric to watch though as this market evolves to become more digital.

The annual contract value for traditional IT and BPO declined by 25%

The Global ISG Index indicators for 2017-2018 imply an expected growth of as-a-Service by 20%, leaving traditional sourcing behind with an expected growth of just 2.5%.  The future appears to be increasingly digital.

 

Capitalising on the benefits of as-a-Service outsourcing with a human edge

Expert partners, such as Netsend, present businesses with the opportunity to capitalise on the benefits of as-a-Service outsourcing, and Robotic Process Automation, through a solution that is refined and implemented by people who deeply understand the business challenges this will answer.

With any new paradigm, there will be those too eager to jump straight to the end goal, perhaps trying to develop or deploy as-a-Service or RPA solutions directly themselves and causing more harm than good.  Bringing in an expert partner to assess the business needs, refine and deploy the ideal solution, and even maintain this over time, will prove more efficient and remove the risk of incorrect deployment.

Talk to us today to hear more about how we support global businesses through the outsourcing of their document distribution and e-billing needs.

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What is Robotic Process Automation (RPA)? http://netsend.com/blog/what-is-robotic-process-automation/ Mon, 20 Nov 2017 16:28:23 +0000 http://netsend.com/?p=3349 A popular question this year has been “What is Robotic Process Automation (RPA)?” and more specifically “What are the benefits of RPA for my business”. The robots are coming.  It’s a fact that businesses need to embrace.  In a typical office, so many day-to-day tasks are completed by following repetitive behaviours, adhering to a strict […]

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A popular question this year has been “What is Robotic Process Automation (RPA)?” and more specifically “What are the benefits of RPA for my business”.

The robots are coming.  It’s a fact that businesses need to embrace.  In a typical office, so many day-to-day tasks are completed by following repetitive behaviours, adhering to a strict set of rules.  How many of us recall the mind-numbing copying, or transcribing, of data from one place to another in our early careers?  As you knew at the time – humans are more valuable than this.

Robotic Process Automation enables businesses to free up staff to focus on valuable problem solving, creative challenges and direct customer or partner interactions – areas where automation simply isn’t possible (at least in this day and age).  Through RPA, tasks that involve repetitive, rules-based, behaviours can be assigned to a robot (typically a software-driven system, rather than an archetypal mechanical robot).

Research by McKinsey & Company indicates that the automation market is likely to be the third most impactful change for businesses over the remainder of the decade (just behind the growth in mobile internet and wireless technologies).  In another report, McKinsey and Company suggest that up to “45 percent of the activities individuals are paid to perform can be automated by adapting currently demonstrated technologies”.  It’s time to consider not whether RPA is relevant to your business, but how it is relevant.

45 percent of the activities individuals are paid to perform can be automated by adapting currently demonstrated technologies

What are the benefits of Robotic Process Automation?

    • Accuracy – once programmed, an RPA ‘bot’ will not deviate from the task, copy-pasting is 100% accurate, information is never miskeyed and quality never wanes due to fatigue.
    • Scalability – bringing more bots online to tackle greater volumes of the same process is a simple task of cloning the original bot, no training required. Modifying a bot’s programme to extend their remit can be just a tweak to a few lines of code.  RPA enables businesses to rapidly scale up, or down, without the need to train, hire or restructure employees to meet changing demands.
    • Speed – working at the speed of a machine, bots can process vast amounts of information, far more quickly than a human. With the advent of Artificial Intelligence (AI) and Machine Learning, RPA paves the way for self-refining processes that improve in efficiency and speed as time goes on.
    • Security – when programmed correctly, RPA presents a reliably secure workforce. Gone are the worries of accidental data leakage, malicious acts, or vulnerabilities from the exploitation of human weaknesses.  Security becomes a matter of encryption of data transfers, hardening of firewalls and something that can be outsourced to an RPA partner, rather than an HR concern.
    • Visibility – every action a bot takes can be recorded for review and auditing at a later date. Total transparency and visibility of all activity is achieved through RPA.

How to implement Robotic Process Automation

There are various ways to bring RPA into your business, typically it is advisable to partner with a specialist for automating whichever aspect of your business you wish to focus on.  Some solutions are driven by code level commands, and some use a full abstraction layer that accesses the user interface of your business systems as a human would.

The initial set up of Robotic Process Automation is key to its success.  Taking the time to ensure all eventualities are covered and any outliers or extremes can trigger a manual checking request will save time later.  Where data is transferred between systems, ensure this cannot be intercepted and establish a protocol for handling breaks in communication.

RPA only works when processes can either be digitised, or are inherently electronic in nature.  In addition to this, automation needs to follow rules.  Without complex AI, it’s hard for RPA solutions to handle tasks which require evaluation or judgement of any kind.  RPA is best suited to repetitive, rules-based, tasks, leaving the decision-making process for humans.

Robotic Process Automation and Accounts Receivable

Accounts Receivable is an area of business ideally suited to Robotic Process Automation.  Many businesses underutilise their AR teams, losing time to repetitive tasks that can be automated via RPA.  Automating repetitive tasks frees up AR teams to focus on the areas that require human expertise, such as dealing with anomalies and answering questions.

At Netsend, we have been helping global businesses automate AR processes for over a decade.  We can help you pinpoint the most repetitive AR processes, establish secure and dependable automation routines for these and roll out automation in a scalable manner – even across multiple countries, business units or brands within a parent company.

Our approach requires minimal time and technical support from your IT department, enabling fast deployment based on proven approaches refined over years of experience.  Netsend integrates with existing Accounts Receivable infrastructure directly – removing the need to export or copy data from one system to another.

With Netsend, the output of the automated processes needn’t be restricted to electronic format communications.  If certain customers still require paper-based communications, Netsend offers a centralised print and postage service to deliver each communication at a fraction of your existing cost.

Talk to us today to find out how we do this for businesses all over the world.

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Improve Accounts Receivable Performance through Better Communications http://netsend.com/blog/improve-ar-performance-better-communication/ Mon, 23 Oct 2017 09:49:18 +0000 http://netsend.com/?p=3273 The post Improve Accounts Receivable Performance through Better Communications appeared first on Netsend.

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Improving Accounts Receivable performance can provide a valuable impact on cash flow for any business.  This improvement can be thought of as spanning a number of focus areas, these are:

  • Communications – types, frequency and content
  • Production – systems and tools to create communications
  • Management – reporting, proactivity and escalation processes

We look at each of these here and outline recommendations to review your existing processes and improve AR performance.


Communication tactics to improve AR performance

The communications process in AR is all about striking the right balance between chasing prompt payments and maintaining good customer relations.  Invoices are sent with plenty of notice, and ideally customers pay promptly with no further reminder.

In reality, many customers require a little extra nudge.  Often this takes the form of a statement – outlining invoice details and reminding of the need to pay.  Or a dunning letter, which is typically sent after progressing from polite reminders and direct contact to the need for a firmer demand for payment.

Conventional wisdom is that if an invoice is not paid within an acceptable period, a statement is sent, followed by direct contact and then, if needed, a dunning letter.  However, it is valuable to identify whether a customer has actually seen the initial invoice, or statement, before sending the next communication.  One of the most common excuses for late payment is ‘not having seen the invoice’, but tools exist to reduce the risk of this now (see the later section on managing AR communications).

In the world of digital communications, many businesses are moving over to electronic invoicing as part of an e-billing intuitive.  This presents many benefits to the business, such as improvements in efficiency and accuracy, but increasingly electronic formats are preferred by customers too.

Consider your customers’ needs, do they have automated Accounts Payable systems, or require invoice submittal to a Value Added Network (VAN)?  In such cases, connectors exist to mesh invoicing systems from AR with their customer-side counterparts.  In some cases, customers will prefer to receive communications by email, or even SMS.

There have been countless studies showing how communication preferences have changed from Generation X, to Y, to Z.  Think carefully about your customer demographics, should you be targeting younger customers with SMS, WhatsApp messages, or other channels?  Where is the sweet spot for email communications, and when do you need to fall-back on sending printed letters by post?


Improve AR performance through better production

Once you have mapped out your customer communication needs and preferences, you need the tools to effectively deliver these communications.  Leading e-billing systems, such as Netsend, offer the ability to send communications in a variety of media types, spanning print and post, to email, to EDI and direct integration with AP systems and VANs.

Where possible, invoicing and other AR communications should be automated – flowing directly from accounting systems to reduce the risk of human error in the copy-paste of information.  Outsourcing to an e-billing specialist, such as Netsend, enables the AR team to deliver accurate communications quickly and efficiently, allowing them to focus on more profitable tasks, such as chasing late payments and dealing with anomalies.

In the era of electronic communications, it makes sense to allow customers access to their invoicing archives – through an online portal.  The use of such a portal can also provide a location for customers to self-service requests for reprints, or even pay invoices online with a card.


Managing AR communications to improve performance

Where modern, electronic, solutions are deployed for AR communications, there is an opportunity to use these to record engagement levels.  Forever removing the risk of customers claiming not to have received, or read, an invoice or similar communication.  Through the advent of such tracking, reports can be generated on a regular basis to understand who has indicated intent to pay, or paid, and who hasn’t even engaged to any degree.

Armed with the insight into who is engaging, or expressing intent to pay, AR teams can more effectively organise proactive communications to remind customers to pay, or identify who they need to pick up the phone to.

Given the linear, procedural, nature of AR communications, it’s not hard to see how many steps in the escalation process can be automated – further improving AR efficiency and performance.


Conclusion

A carefully balanced approach is required to ensure the best communications, production and management practices are in place and aligned to deliver optimal AR performance.  Working with an expert partner to outsource aspects of AR processes, such as electronic invoicing and associated communications is one of the most effective ways to achieve this.

 

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How to Solve the Sales vs. Credit Control Battle http://netsend.com/blog/credit-control/how-to-solve-the-sales-vs-credit-control-battle/ Fri, 13 Oct 2017 15:56:44 +0000 http://netsend.com/?p=3262 The post How to Solve the Sales vs. Credit Control Battle appeared first on Netsend.

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It never ceases to amaze me that many squabbling factions can still comprise a successful business.  The case of sales vs. credit control is a classic example of this.

From the perspective of a sales person in a business whose main customers are credit controller departments, I’m privy to a unique perspective on this age-old divide.  In the most successful businesses, these two departments work seamlessly together – two equally valuable sides of the same process.  In businesses where this isn’t the case, there’s room for growth and improvement in efficiency when these departments are drawn together to work more effectively.


The Sales Perspective

As sales teams strive hard to win deals, it’s understandable that frustration is felt if credit control refuse to extend credit to close a deal.  Those who have worked in, or close to, a sales department may have heard inaccurate, but popular, reference to credit control as ‘the risk department’ or ‘order prevention’ at times.

There are many sales people out there who will go to great lengths to avoid involving credit control in the sales process – fearing they will shut down a promising deal, for undue worry about their ability to pay.

But stop and think about it.  If a deal is genuinely at risk of going unpaid, is it worth ‘closing’ anyway?  Credit control have no negative agenda, they are simply watchful to ensure credit isn’t overextended and cashflow is reliable.  So, let’s understand their side of the story…

The Credit Control Perspective 

Where credit control can be accused of being too cautious, the inverse can be true of their view of sales.  Credit control departments have to pick up the fallout from sales committing to working with unreliable clients who may struggle to meet invoice payment deadlines.

There’s a popular saying in credit control departments – “It’s not sold until it’s paid for”.  It’s no good winning the biggest deal, if the money can’t be brought in.  Businesses rely on cashflow, and it’s up to the credit control department to ensure that the money is brought in.

Understandably, it only takes a few bad experiences before credit control departments can be heard referring to members of the sales team as ‘sharks’ who will ‘sign anyone up, regardless of the risk’.

We should pause for thought here too, as how many sales people are educated on risk factors for payment, or encouraged to work collaboratively with credit control to ensure deals are landed that stand the best chance of success?

Reconciliation for Success

Reconciling sales and credit control, through better mutual understanding, and communication, is key to addressing any divide.  It’s common for businesses to focus on improving performance by training and educating within the narrow band of each employee’s designated role.  But great value can be achieved by interdepartmental training – particularly between complimentary departments such as sales and credit control.

Encouraging a tighter working relationship between sales and credit control will ultimately enable the business to chase more profitable business

Consider how much less time would be wasted if sales teams filtered out high-risk opportunities, which would be shut down by credit control anyway, before they progressed things too far.  Encouraging a tighter working relationship between sales and credit control will ultimately enable the business to chase more profitable business, more quickly, and ensure greater reliability in cashflow.  Benefits could also be measured in improvements in DSO or delinquency.

Taking the concept of sales and credit control collaboration further still, credit control could proactively furnish sales teams with information about any existing clients who have an uplift in credit-rating.  This would imply that they are growing, or at least present a lower credit risk.  Sales teams could use this insight to drive higher sales volumes with these clients.

Better Tools, Better Working

Tools such as credit information resources can provide inter-departmental value, as mentioned above, but what other tools exist to improve this working relationship?  At Netsend, we find that some of our clients rely on Netsend to provide deep insight into what is being sold where.  In some cases, detail of specific product sales, in specific locations, is only apparent from invoicing records.  Beyond this, our clients use Netsend to identify late-payers and address these, as well as calculating credit risks based in insight not available to credit information resources.

Sales teams can also benefit from knowing when a customer is facing payment reminders, so they can either hold back from trying to grow a troubled account, or even assist in the communication process to bring the cash in more quickly.

Ultimately sales and credit control are two sides of the same process, and both rely on the overall health of the business (i.e. cashflow) being optimal to ensure ongoing security and growth within their departments.  Working more closely together, and sharing data from appropriate tools and services, leads to a more efficient business and better working environment for all.

 

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Best Practices in O2C Project Management http://netsend.com/blog/best-practice-in-o2c-management/ Mon, 04 Sep 2017 11:40:05 +0000 http://netsend.com/?p=3212 By Chris Caparon, COO at Cforia The consensus directives coming from North American CFOs to their finance and accounting teams include 1) Ensuring business performance by establishing new cost efficiencies, financial plans and analytical approaches and 2) Managing operating risk through risk management strategies and systems. However, the challenge lies in dealing with projected business […]

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By Chris Caparon, COO at Cforia

The consensus directives coming from North American CFOs to their finance and accounting teams include 1) Ensuring business performance by establishing new cost efficiencies, financial plans and analytical approaches and 2) Managing operating risk through risk management strategies and systems.

However, the challenge lies in dealing with projected business changes and the ever-increasing departmental demands with flat or shrinking staff and more complex management requirements, while:

  1. Reducing Days Beyond Term (DBT) and accelerating the conversion of receivables into cash
  2. Mitigating credit risk and portfolio roll-up of global client exposure
  3. Reducing write-offs and diminishing bad debt reserve requirement
  4. Shortening the discover and resolution cycle times of client disputes and deductions
  5. Increasing customer O2C lifecycle satisfaction and making it easier to do business with

So, what are the best practices in order-to-cash project management? To answer the question, we need to look at a compilation of data points, and in this case, the findings have been observed over 14 years and 200 enterprise O2C implementations. These companies are managing over $240 billion in open Accounts Receivable portfolios today.

The top ten O2C areas are:

  1. Accounts Receivable Methodology
  2. Invoice Dispute and Deductions Resolution Handling
  3. Order Hold/Release Decisioning and Processing
  4. Application of Invoice Payments
  5. Lockbox Handling
  6. Generating Reports and Departmental Performance Analytics
  7. Billing Process Methods
  8. Multi-ERP Consolidation & Global Customer Management
  9. Credit Risk Management
  10. O2C Organizational Effectivity

From Paper to Digital

On average, 50-60% of the AR portfolio is being touched within each 30 day O2C cycle. The collections methodology is primarily call-centric, which means that there is little automation within the process. This lack of automation leaves AR departments working off disparate, paper-driven processes.

There tend to be lots of manual filing cabinets with literally thousands of well-used, sometimes decades old file folders. Teams might be working from printed, aged, trial balance sheets and creating collections and resolution notes in the margins of the report. Often there are many other manual, Excel, Access or other non-database driven prioritization of activities, which are not centralised and are specific to the work queue of the individual collector, resolver or credit analyst. With these decentralised, separate workflows in place, collaboration and overall AR visibility is near impossible.

Such environments tend to have little to no hierarchical account aggregation for mid-sized, large, chains and strategic accounts – no way to see the whole exposure of the parent-child portfolio. There are many off-system/manual credit or collections workflows and processes which have little consistency between individual resources, remote locations, or operational disciplines.

A key element to converting receivables to cash are Promise-to-Pay (P2P) reminders, which are located in Lotus Notes, Outlook Calendars, spreadsheet or manual processes. This is a critical success factor to impacting working capital.

There tends to be little ability to separate receivables sub-ledgers to optimise the collections and disputes performance activity and collections/resolutions are “managed to the rule” rather than “managed to the exception”. What this means is that virtually everything needs to be touched, versus segmenting the activity which can be automated to achieve 100% portfolio touched in each 30 day cycle and that there is simply no time to address a large number of small transactions or client accounts.

Observations of Best Practice

Collections environments exhibiting “best practices” are those that can be characterised by the following characteristics:

  • Teams have the ability to automatically segregate the receivables that are at risk based on sophisticated algorithms, taking into account payment behaviour patterns, historical performance, degradation of performance, credit bureau data and trade data which is blended and weighted
  • This optimises collections, dispute resolution and credit resource effectivity based on activity and calling priorities. This needs to be an automated process so that when resources arrive, their day is planned and can be executed in a “best practice” methodology to minimise the time required to identify high-value daily targets and prepare for daily activity

Your team needs near-time visibility into orders and payments to be most effective. VF Corporation reported “Netsend offers VF Corporation complete transparency. We now have the real-time visibility needed to enable proactivity”.

“Through improved efficiency and visibility, Netsend saves us hours every day”
Head of AR, The Guardian

Introduction of AR Portals

Best practice environments use reporting, analytics, dashboards and automated workflows in order to streamline O2C sub-process and critical steps that deliver the biggest working cash impact. This is true of not only resource activity/productivity but of automated communication and electronic calls-to-action to your clients.

Having links embedded in automated email messages, empowered with solutions like client portals, such as Netsend, for 7/24/365 customer self service enables them to access their digital invoice archive, whenever, wherever.

In many (non-best practice) environments, at least 60% of client inbound calls are about invoice queries that could well be instantly resolved through a self-service portal.

Implementing Best Practice in Your Business

Those using AR portals can create custom statements, make disputes, request contact from a resolver or pay bills immediately via a link provided. These types of businesses use a single solution for managing all aspects of AR collections, so they are not constantly flipping between separate systems which contain bits and pieces of the O2C lifecycle.

These AR collections methodology best practices yield on average a ROI of approx. 25% reduction in DSO, approx. 80% reduction of inbound call volumes regarding invoice related issues, approx. 40% improvement in O2C resource productivity and enable significant sale volume growth rates without having to add corresponding headcount.

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PEPPOL Latest: 2017 Progress http://netsend.com/blog/peppol-latest-2017-progress/ Mon, 07 Aug 2017 13:39:07 +0000 http://netsend.com/?p=3145 The post PEPPOL Latest: 2017 Progress appeared first on Netsend.

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As PEPPOL adoption increases across the UK, we thought it’s time for a recap on our ‘What is PEPPOL’ article and a review of recent PEPPOL news and progress in 2017.

PEPPOL stands for Pan-European Public Procurement On-Line, an EDI (electronic data interchange) protocol, designed to simplify the purchase-to-pay process between government bodies and their suppliers.  PEPPOL facilitates electronic ordering, invoicing and shipping between government organisations and private companies.

The need for PEPPOL has arisen from historic inefficiencies and limitations in the way that government bodies procure from their suppliers.  Traditional purchase processes have evolved little over the last few decades, the advent of PEPPOL seeks to shake things up for the better.

PEPPOL is notably the EDI protocol chosen by the National Health Service in the UK (NHS) to achieve efficiency improvement and meet the government initiative of saving £22bn by 2020.

How is PEPPOL growing in 2017?

Membership to OpenPEPPOL continues to grow, with Poland joining at the start of 2017 to become the 200th member.  The Polish government has started building the national services platform (PeF) supporting electronic invoicing for public procurement, with an intention of having a full roll-out by Q3 2018.

In Italy, the Emilia-Romagna Region has achieved significant success enabling the dematerialization of public purchases for the whole procurement cycle, starting from the collection of public requirements and the achievement of digital tenders, to the fully electronic management of orders, dispatch advices and invoices.

The ER region has taken an active role in developing e-procurement standards as part of PEPPOL, since 2008.  From 2014 the regional Health Trusts in Emilia-Romagna have been able to digitally exchange all of their invoices.  Moreover, from June 2016, the same Health Trusts have also been able to send and receive orders and dispatch advices electronically, based on PEPPOL standards. To date, the Regional Telematic Interchange Hub (NoTI-ER) has handled more than 100,000 e-orders, 130,000 e-dispatch advices and 1.8 million e-invoices.  Elsewhere in Europe, nascent PEPPOL projects could do well to look to the ER region in Italy for inspiration and reassurance.

In Belgium, from 1st July, companies have been able to send invoices to federal agencies in electronic format.  Belgium has been working on electronic invoicing since 2013.  In 2017, Fedict (the Federal Public Service for Information and Communication Technology) launched the Belgian electronic invoicing platform.  The biggest challenge in deploying this platform had been the existence of several networks with data in different formats, thankfully this has now been resolved.  The federal body has been working on a platform for the Belgian authorities since 2013. It is now compliant with European standards (OpenPEPPOL). The platform’s name is Mercurius.

Examples of PEPPOL progress in 2017 at UK NHS Trusts

Whilst only a handful of demonstrator sites are leading the charge for full-blown PEPPOL support, progress is encouraging.  Some examples of NHS trusts and what they have achieved to date (July 2017) are listed below:

Derby Teaching Hospitals NHS Foundation Trust

  • All patient wristbands 100% GS1 compliant
  • Scanning of wristbands at 50% of the trust’s Points of Care
  • 100% of trust locations allocated GLNs
  • Over 50% of purchased products listed in new PEPPOL-integrated catalogue
  • Product recall process in place – tracing products to patients in Theatres
  • First PEPPOL order and invoice transmitted
  • Inventory Management System in place, enabling stock review and amendment to match usage information

Leeds Teaching Hospitals NHS Trust

  • Phased introduction of GS1 compliant patient wristbands
  • 100% of trust locations allocated GLNs
  • New PEPPOL-integrated catalogue
  • Product recall process mapped, pending development and deployment

North Tees and Hartlepool NHS Foundation Trust

  • All patient wristbands 100% GS1 compliant
  • 100% of trust locations allocated GLNs
  • New PEPPOL-integrated catalogue
  • Product recall process in place
  • PEPPOL order and invoice process in user acceptance testing

Plymouth Hospitals NHS Trust

  • Wristband printing software is 100% GS1 compliant, scanning is in testing phase
  • 100% of trust locations allocated GLNs
  • Over 35% of purchased products listed in new PEPPOL-integrated catalogue
  • Product recall, Purchase-to-Pay and Inventory Management solutions in development

Royal Cornwall Hospitals NHS Trust

  • All patient wristbands 100% GS1 compliant
  • 6,649 trust locations allocated GLNs
  • Catalogue, product recall, Purchase-to-Pay and Inventory Management solutions in development

What is the easiest way to become PEPPOL compliant?

As with any business decision, the cost-case for investing in PEPPOL needs to present a return on investment as swiftly as possible.  The breadth of requirements for full PEPPOL-compliant eProcurement presents an investment conundrum for NHS trusts and suppliers alike – how to make this investment before budget is available from the savings achieved.

One of the best approaches to this challenge is to deploy PEPPOL-compliant e-invoicing as a first stage.  Both suppliers and NHS trusts stand to make substantial savings through electronic invoicing.  These savings can then be reinvested in the broader requirements of full PEPPOL-compliant eProcurement.

In the context of invoice generation, as opposed to invoice processing, solutions such as Netsend, present an attractive business case.  With a minimal upfront investment, setup costs are offset and become part of operational expenditure.  This equates to a lower barrier to adoption, enabling suppliers to extract competitive advantage and business gain rapidly.

Talk to us today and find out how Netsend is able to support PEPPOL-compliant e-invoicing.  Or you can find more information about PEPPOL in our PEPPOL FAQ Document here.

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Metrics to analyse Accounts Receivable performance http://netsend.com/blog/metrics-accounts-receivable-performance/ Tue, 01 Aug 2017 08:08:10 +0000 http://netsend.com/?p=3060 The post Metrics to analyse Accounts Receivable performance appeared first on Netsend.

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Measurement is the first step towards improving performance.  And measurement is only valuable in this regard if you’re measuring the right things.  Through the deployment of electronic invoicing, we help clients all over the world improve their accounts receivable performance, so we’ve established a clear list of the metrics that matter to determine performance improvement.

Browse the list below and evaluate your accounts receivable performance.  At Netsend, we can show you how significant improvements can be made in all of these important areas.  For instance, how The Guardian reduced their DSO by 2 days – read their case study here.

Days Sales Outstanding (DSO)

Probably one of the most important, and frequently measured, metrics for judging AR performance.  DSO is the length of time it takes to collect the money owed to the business.  Different industries, and different countries, have different average lengths of DSO.  One of the best resources for determining the average your business should be looking to meet, or improve upon, can be found in the quarterly Atradius Reports.

On average, in the UK, DSO is 31 days.  This is significantly better than the average of 44 days DSO across Europe.  With payment terms typically being in the range of 30 days, this equates to an average delay of just 1 day in the UK, but 14 days across Europe.

It’s important to realise that DSO can fluctuate significantly, so is best averaged over a year at least for general performance, or tracked more closely for regular late-payers and a means to chase sooner and shorten their typical delay time.

DSO is best contrasted against best possible DSO, with the goal of driving DSO down to as close to the best possible DSO as you can.  Best possible DSO is calculated as:

Best possible DSO = (current receivables x number of days in invoicing period) / credit sales for period

How to improve DSO?  One of the easiest ways to drive down DSO is to integrate with buyers’ payment systems and encourage automated payment – perhaps incentivising for payment within an acceptable timeframe.  Additionally, tracking invoice receipt and even intention to pay can provide an early indication of which customers’ payments will need to be chased down, and who is likely to pay on time.  At Netsend, our portal provides an easy route to track payments and our connectors provide deep integration with a vast range of payment systems and Value Added Networks (VANs).

Average Days Delinquent (ADD)

The measure of ADD provides insight into how effective AR processes are in collecting receivables on time.  ADD is calculated as:

ADD = DSO – best possible DSO

As mentioned in the section about DSO, above, it is important to use best possible DSO and actual DSO as comparative metrics – ADD provides exactly this measure.  Plotting ADD and DSO visually, over time, can provide an intuitive handle on performance fluctuations.

Collective Effectiveness Index (CEI)

CEI provides insight into how effective AR process are at collecting all outstanding money in a specific period (often one year).  CEI provides a quantitative handle on collections processes, rather than the more qualitative indication from DSO or ADD.

CEI is calculated as a percentage by:

CEI = (beginning receivables + monthly credit sales – ending total receivables) / (beginning receivables + monthly credit sales – ending current receivables) x 100

100% CEI implies a perfect collection process, so AR teams should strive for as close to this as possible.  Ongoing performance measurement should pick up any significant drops in CEI, as these indicate a problem with the collection processes.

CEI and DSO should move in different directions as performance enhancements are made to AR processes, such as e-invoicing or automation.  CEI provides an overall measure of quality of collection processes, rather than DSO or ADD which are measurements of time and reflect broader AR processes.

Accounts Receivable Turnover ratio (ART)

The ART ratio indicates cash flow and liquidity through a measurement of how frequently accounts receivable are turned into cash.  ART is measured over a period of time, typically a year.  ART is calculated as:

ART = net credit sales / average accounts receivable

As any CFO, CEO or senior financial role will be aware, cash flow is extremely important for the health of a business.  Free cash flow determines how much money is left to reward shareholders, or to reinvest for business growth.  Measuring ART keeps tabs on how effectively AR processes are supporting this.

Number of revised invoices

Whilst this isn’t a standard, formal, metric, the number of revised invoices generated over a given period is valuable to track.  This determines the quality of the outgoing invoices and can help identify needs to improve initial invoice quality through automation or better access to information.

And invoice revision that is required adds additional workload to the AR team, and time to the invoicing process.  AR automation is a proven approach to reducing inaccuracies in invoices and flows well into the wider remit of electronic invoicing.

Improving Accounts Receivable performance after measurement

Whichever metrics (hopefully all) you are measuring, you need to think what you intend to do with the learnings.  Determining that your DSO is well beyond your industry average, but without a plan to address this, measurement is meaningless.

Solutions such as electronic invoicing and AR automation present a popular route to addressing AR performance challenges.  The beauty of these solutions is that they support your existing AR team and processes, enabling AR teams to focus on more valuable work that can’t easily be automated or digitised.  The biggest threat to business success is, often, wasted time – at Netsend, our AR solutions improve productivity and enable you to focus on your business.

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