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Move Beyond a Simple Tickler to Optimize A/R Collection

21 September, 2015
3 min read
Brett Johnson, AVP, Global Enablement
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What you'll learn

  • Enable automated tickler with the AR database to reduce manual work.
  • Improve productivity and efficiency by eliminating paper from the AR environment.
  • Prioritize, handle and report activities automatically and with ease.
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To be effective in your collections efforts, you must have a process in place to handle the scheduling and execution of follow up activities. Traditionally, these activities have been handled manually. AR employees have relied on desk calendars or tickler files where they manually jot down whom to call and when. A low-tech clerical task, it does the job but it’s not efficient. If the account pays and you don’t need to place a follow-up call, you still have to dig to check status before aborting the follow-up. Also, if you are using a calendar, you may have the tickler notice in front of you but not the contact information you need. In the current AR environment, a manual tickler process is inefficient and time-consuming.

A step in the right direction is using a tickler notepad that comes as a part of many accounts receivable software packages. However, people frequently run into similar problems as when using a manual paper process. It’s easy to schedule too many follow-up activities since there is no visibility into the larger schedule. Workloads can get even more backed up than when using a paper method. While contact information may be a click away, the note in the online account file is still just a note – the collector still needs to look up account information and invoice status before making calls. They need to be processed in place to make an automated tickler file truly work.
What needs to occur is the integration of the tickler file and/or computerized notepad with the AR database. When this is done, you can then take steps to do the following:

  1. Prioritize collector’s daily workload – Spread out those follow-up activities in a manageable schedule so that they can get done as planned.
  2. The system should automatically update itself when invoices are paid and delete the appropriate scheduled follow-up communications. This eliminates the risk of making that embarrassing phone call to ask where the money is only to discover it has already been paid.
  3. Determine the next appropriate step to take according to client-specific collection strategies. After the initial follow-up call or email, what is the next automatically scheduled step? When the outstanding amount reaches a certain threshold do you switch from an email follow-up to a call?
  4. Automatically record all collection activities. This sort of contact history is essential for getting to know the customer’s tendencies and if an outstanding invoice turns into a dispute requiring resolution.
  5. Generate transaction-specific correspondence (i.e. invoice copies, proofs of delivery, etc.) with ease – in this way there is no delay when a customer makes a request.
  6. With today’s technology, you should not have to leave your desk to send a fax or make copies – one click should pull up client contact information, and another click should open an email, prepare a fax or a collection letter.
  7. Provide reports on collection activities – Because you are recording all account activities, your solution should generate reports on average payment times, days past-due and any other sort of parameter that will help bring visibility into your client relationships and determine trends that require additional attention.
  8. Filter and sort tasks requiring different types of communication – You should be able to prioritize your task list in order to optimize collections by first follow-up accounts with broken promises or scheduled follow-ups and then those with the biggest outstanding balances.

Not only will these steps improve your efficiency, but the collections department as a whole will see an increase in productivity and performance. With a transparent, automated tickler process, the man-hours spent performing these tasks is greatly reduced.
Download our whitepaper on Whitepaper: The Imperative for Eliminating Paper from Receivables and Credit
Are you using automated ticklers or doing it manually?

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