Improving Collectors’ Productivity by 90%, Cash Forecasting and Reporting with AI

Speakers

Tony Hiatt

Global Credit Manager,
Ivanti

Transcript

[0:00] Announcer:

OK, so this session is 90% improved collectors productivity, how Ivanti improved cash forecasting and analytics using AI. Our presenter today is Tony Hiatt. Welcome, Tony. So a little bit about Tony. He is the global credit manager. And he has a privilege to work with Don. And he’s an experienced credit manager with a demonstrated history of working in multiple industries. So a little bit of information for you. So take it away.

[0:36] Tony Hiatt:

All right. Hello, everyone. I’m Tony. Hi, I’m the global credit manager of Ivanti. I’m going to share our story with you on the issues we had, the improvements we made and then efficiencies that we got out of it. So we’ll go ahead and start. So Ivanti, we are a software company, we do infrastructure, security, a lot of firewalls security setup. So 90% of the time your IT department uses our software. The basic steps that we took off for our digital transformation, our digital transformation at Ivanti how we enabled cash forecasting at Ivanti. The results that we have from that, and then the lessons learned after we were done.

[1:30] Tony Hiatt:

So, digital transformation, what we needed to do first was we needed the automation, we needed the processes, identify those processes that we can automate, and the changes after that automation. Okay, so we’re going to start with Process Performance. Process Performance wasn’t just the collectors and what they did and how we could track their performance. The Process Performance we needed to report visually to our executive team. So we’ll start here before automation.

[2:16] Tony Hiatt:

We just had collectors, they would pick up the phone, they would work off spreadsheets. Basically, you could sum it up, they were dialing for dollars, they would try and identify the biggest cash first because that would make the biggest impact on the agent. So a lot of the low bearing fruit was being missed in this. So the challenges, manual correspondence, we all know that you have to put it in Outlook, you have to email it out. It takes a lot of time to reach customers. The call logs we had none. We had no notes. They basically were working off Excel sheets. You can’t put a lot of history in there. We had no account history in our ERP, we use SAP. So we were able to collect notes or keep track or do reminders or follow-ups. And most of the time that they did put it in Excel, they would miss it. So they would never reach out to the customer again, that was our biggest challenge.

So also, past two invoices, customer contacts, we would have multiple contacts. But in our ERP, we were unable to store that information. So sometimes if you erase the old contact for a newer one that’s gone. We had no ability to keep that. The spreadsheets, Excel half and they go through their filter or filter, try and identify the biggest dollars it doesn’t matter how past due, it was or how current it makes the biggest impact on their agent. So that’s what they were doing, there was no way to prioritize or focus on what they need. To do so, after automation, we were able to, on the past few invoices with HighRadius, the collection cloud, we were able to send out reminders, proactive reminders. So now that invoice for that email that goes out through the system will go out to them five days before the due date to remind them, hey, these invoices are coming due. The next part of the automation is it would actually go through and do it every seven days- dunning one and that would go up to 31 days. Then dunning two would start growing out. That would go out every five days. Then dunning three would go out at 61 days with a credit whole notice letting them know no orders are going to pass because it’s over 60 days. That would go out every three days. So it would reach every account.

Our collectors no longer had to reach out to the customers, it actually brought the customers to them. They would come in and their AR inbox was full. So they actually could set their work account with the customer, work the issue and resolve it. The system was doing all the heavy lifting. It was reaching out to every customer. It was pretty amazing. I mean, honestly to see all these customers reaching out, wanting to pay bills, wanting to get it resolved instead of my people didn’t matter the amount of the invoice. It was just everybody was getting contacted. We were able to put customer contacts in the HighRadius system. So we were able to keep lots of 5, 10, 15, how many contacts we needed. We could put those in there. We could store notes, call logs. We were able to see how many accounts a collector touched and what they did on that account, Did they make notes? What kind of contact did they make? So we were able to actually match their performance with their merit-based off of HighRadius and the KPIs it provided on their performance.

[6:16] Tony Hiatt:

So, any questions on this? Yes.

[6:34] Audience:

[Inaudible question]

[6:36] Tony Hiatt:

Well, he would probably receive every seven days. So, that’s a good question, too. So what we had in there, you know, backtrack a little bit. We’re not sending a notice on every invoice that’s general. Okay. So what would the system do is say, Okay, these invoices fit into this category. So it would send out one Dunning that represented five or six invoices. And it would always go off at the most passed due and that’s the status it would put it in. That’s the Dunning it will go out. Yeah.

[7:34] Audience:

[Inaudible question]

[7:36] Tony Hiatt:

We only included what was passed due. So the five-day reminder that went out five days before the due date that is on every invoice. Okay? Because it has a lot of identifying factors in that. Notice invoice number and so forth. So no. So for example, if we had, let’s say, the oldest invoice was sixty days, and then we had a few that were underneath that it would put it into Dunning two and it would include those invoices, but if something wasn’t due, or is in current status, it would exclude that. So it’s only sending out messages on past due invoices, and it goes off of the oldest invoice is what it puts it all into. So it’ll be dunning two, dunning three, whatever that will this invoice category fits in. Also, we were able to provide statements. I know for a software company that it’s pretty sad that we can’t provide statements. I mean, we laughed about it, honestly. I mean, for a software company, we provide all of this great stuff, but our internal processes were just manual. So we are able now to provide statements and the statements are automated. They go out on the fifth of every month and now we’re able to provide that before we couldn’t. It was kind of funny.

[9:06] Tony Hiatt:

Okay, so, automated priority worklist. How we did this work list is we basically took our policy, our credit policy, how we expected them to contact, how many times we took that whole policy and made our prioritizing work list for them. So they’re not focusing just on dollars, they’re focusing on the status of that invoice. So if it’s 60 days past due $900, it’s going to be on their worklist. They have to work it, they have to touch it. So we were able to do that in the sense where they just come in to log in to the system. It has everything therefore, they know exactly what their days can do, and what they need to work first. Then that had a big impact on improving their productivity. They didn’t have to sort through Excel sheets. They didn’t have to color code. They didn’t have to spend an hour kind of deciding what they’re going to do, the first variable to help customer complaints, log disputes, which we weren’t able to do before. We had no visibility on how many dollar amounts we had in disputes, what issues we had in certain departments because of disputes. So that was a big one. The maximum account coverage, with the dunning going out automated, we came to a realization that one collector can handle 240 active accounts. So that’s their load. Now, they’re able to do that because of the automation and the correspondence. You know, before we even jumped into the automation part, we didn’t just go full-blown up to 90 days. Putting all this automation, we had to show them how to work with the system. So we started off actually with just doing dunning up to 31 days done in one and have them focus on everything over 31 days. Then we upped it again after another couple months with that they were comfortable, we stretched it to 60 days and then plan implemented dunning two then we let them get used to that and focus everything over six days. Then we put in the 90 days Dunning and arranged the workforce so that they weren’t duplicating what had already been done. And they need the flow of work that helped prioritize and made them efficient and what they did.

[11:49] Audience:

[Inaudible question]

[11:53] Tony Hiatt:

This is the cloud. This is the collection cloud. We also have radius one, the customer portal. Get into that to how we implemented that and the efficiencies that brought. But yeah, we have both solutions. Thanks.

[12:10] Audience:

For the 240 accounts per collector, how often did you expect them to contact the customer?

[12:16] Tony Hiatt:

The system did it for them, they never reached out, they would reach out and actually focus on that account. So it’s not just an email they’re sending, they’re picking up the phone. They’re calling that customer because they’ve already received the notices. They don’t need to send their contact is not just a reach out. It’s to get a hold of someone and get a resolution that takes an hour of their time to resolve that account. It takes an hour of their time. So as far as expectations on that we don’t really have any expectations on how many accounts to touch. It’s not about quantity. Now it’s about the quality of work.

[12:58] Audience:

Because I’m going to so many of these letters going out for all the right reasons. Right? A collector doing the same stuff now sending out personalized emails, possibly with similar content that has already gone out and the Dunning the expectation obviously would be for voice contact. Now in this situation, do you also measure contact rates for your customer basis? Is the response rate high enough to really get connected?

[13:22] Tony Hiatt:

Yes, we are diving into that. But yes, we do expect that we do track the contact, how they’re contacting, if they legitimately contacted, yes.

[13:38] Audience:

Is HighRadius automatically tied into your system? So you mentioned credit hold, for example, is your system able to automatically be placed on credit whole based off some of the parameters that HighRadius is putting on or is that a manual step for your team?

[13:54] Tony Hiatt:

No, actually, we have that already automated in our ERP. All we did was get the system to kind of, you know, at 61 days the system does put a customer on hold, if they are passed to when they reach that 61 the ERP automatically does it. So the system just kind of sends notification to that customer that hey, this has happened. So it does not feed in it does not push anything back into our ERP. But it does update Customer Contact every, every night. I think it goes around 1 am because I have a team in Dublin that gets in at 2 am in the morning, our time to start their day. So they work in this system in Europe. That was the other thing is we were all playing from different playbooks. We are a global company. So my team in China would do things differently than my team in Dublin. Dublin will do different things than we did. So in the sense of Reporting our information as well, it’s all different. Everybody would put their numbers out in their own way. That was another frustrating part of my executive team. I mean, I would have to gather and wait and gather information from everybody to kind of put it in the same format, the same way to present it. That was really, really frustrating. So being able to have everybody on the same playbook, you know, was a big efficiency in that part. I mean, not proud of this comment, but we were able to reduce our staff by half. So we didn’t need that many people. We were being more efficient and more effective with a lower headcount. Because we didn’t have the system, we didn’t have enough work for everybody. Some questions on this?

[15:58] Audience:

Do you ever see this scenario where you might have a customer that pays that apparent really likes the account level and then another customer that each individual site might pay? And are you able to, like send Dunning to a site level versus a parent level?

[16:14] Tony Hiatt:

Yes. Okay, we do have that. So we do have partners that sell our products for us. And then they have actually partners of their own, and customers that want to pay us directly, even though they’re putting the order through there. So yes, we have to make a new account. Obviously, to supply our product, they have to have their own account. But we do have an identifying factor on that account that tells us who they’re linked to. Now with the dunnings as far as in separate dunnings on our global level, in EMEA, we are sending German dunnings to German customers, because in Germany, they like to speak in German and that’s how they communicate. They did not respond or live Our English dunnings. So we’re able to strategically put and say, Okay, any customer that’s located in Germany gets German dunnings, the system will automatically send it to them. We’re working in France, we’re working in Spain. We’re working in Brazil. And we’re working in Japan to have their own identifying language to communicate. And that was another big factor. Because in Germany, once we start doing that, our payments start coming in from them. They started responding, they started talking with us. So we found that communicating in their language is giving us better results. So we’re able to strategically do that as well.

[17:45] Audience:

[inaudible question]

[17:53] Tony Hiatt:

Yes. So that means what we did is we mass that, so you’re able to mask them in the system. So it doesn’t go out and say, no reply, no, the email comes out and it says Ivanti collection team. That’s the email that they see when they open the email, they see the signature of that collector that is responsible for their account. And also when they reply, it goes to that collector, it goes into their email box, and they’re able to communicate with them. So these emails, as far as a customer standpoint, they’re not automated. When they reply to that email, they get something, they get that person that is on that signature. So we mask them because we wanted that we didn’t want to have no reply emails that don’t do anybody any good. You’re just sending out noise, but to have it mask and have them reply, in their mind, that email was sent by someone, not a machine. So make sense? Anymore?

[19:03] Tony Hiatt:

Okay, reporting. So talk about this a little bit. So on the reporting factor, we had no report, it was just what I was coming up with, I would do Excel, put it in a pivot, put in a KPI and try to present. That was a big issue. In the sense, you have to wait days to gather the information globally and try to put it together. It would take six, seven days after close, to be able to get the executives the picture. They don’t want the detail. They just want the picture. So we had the in-depth KPIs for employees, or the collectors to know what they’re doing. We have the dashboard for performance and monitoring, not just them. The accounts what popped up, what account is now a big issue, what one’s not because in a sense we want to see the problems. You know, we don’t want to see everything they dig in. We want what’s going to be an issue. Okay, so KPIs, we’re able to monitor how many accounts they touch, how they touch them notes, phone calls, promise pays disputes. We’re able to track that and we linked it to their merit increase. So their performance here depends on their race at the end of the year.

[20:28] Audience:

Yeah, how soon after you implemented and went live? Did you actually start using those metrics?

[20:36] Tony Hiatt:

Day one. Because that’s how we knew to make them get in the system to make the change. Some people will resist, you know, so to tell them, hey, you’re being monitored, you need to get in. That’s how we were able to do it. We did it day one. So they knew that they needed to be in the system. So we had difficulty evaluating employees and performance inaccurate appraisal processes missing, you know, this, they were missing out on ones that weren’t getting promoted that needed to be promoted because they were putting in the work and so forth and getting the raises that they deserved. So, this is an example kind of how the KPI works. And you know, it lists everybody who gives you kind of their performance way. It’s way more detailed than this. This is just one. Okay, dashboards for performance monitoring. Again, we have five minutes. Yeah, I’ll try and rush and we’ll get through these questions. Yeah. So the process of manual reporting generated by the process owners. That was one lack of single view visibility. We had no view of what our team was doing in EMEA. We had no view on Japan, China, what anybody was doing and how they were doing it. This here, day sales outstanding, these are more of the KPIs but trust me, this is not all of them. There’s a lot of KPIs, you can definitely dig in and find the ones that best serve you. That’s what we did. We, the ones we use are the ones we use that work for us. But there’s a lot there that will help you whatever you want to measure by. So effective aging analysts and fast-tracking collections. The efficiency part, I’m just going to sum this up on this is when I started with them, I had 47% over 60 days. We’re now at zero, we have no money over 60 days.

[22:51] Tony Hiatt:

It is, it is. It’s like it’s just crazy even to think about it, you know to go into the executives’ room and there isn’t one question on AR. And we get skipped over now when essentially it was like whoa, why are we so high where’s our money, our money is coming in faster. Okay? Our cash forecasting that’s done through automation. What HighRadius does is it feeds off of our master data. And it goes off with the customers’ DSO, which is stored in your master data in ERP, which hence makes your payments your customers’ individual payment habits. So our cash forecast is not on the due date or guessing or picking. The system says based on their payment behavior, this invoice is going to be paid this week. We are coming within you should always try and beat your forecast but we’re coming within we’re always a couple hundred thousand dollars over the forecast. But we’re able to budget our money to it. My CFO feels confident with the numbers and the logic behind it. That’s how we do our forecasting. A seven-week forecast is what the system spits out every Monday morning to me, it sends it to me. That was huge in that part. So that was the big one I kind of wanted to point out because that’s, to me also the cash forecasting.

[24:18] Audience:

How long did it take you to get from 47% to zero percent, one year?

[24:22] Tony Hiatt:

One year, because it wasn’t just getting them in there. We, I mean, you got to take the time to do it right with automation. You don’t want to rush it. You got to get the people used to working with this system and not duplicating the work. That’s the biggest part. Because if they’re reaching out emails, the system’s doing that too. You’re wasting time. They need to pick up the phone, call the customer because the notices so we started out 31 days Dunning one. Once they got comfortable, we went to dunning two, dunning three now. Their framework is they don’t touch anything under 60 days, their focus 100% is anything that goes over 60 and when they do it, they work that account. If it takes an hour, two hours of their day, they work it, they resolve it, they get it done. That money doesn’t age anymore. So we have found that that works for us with automation. I mean obviously we want to get our numbers down more. And we’re looking at that but in our industry, the way customers pay in the software industry between our average is 45 days. Our customers on average now pay 14 days past the due date when before we were 70 something days past the due date. Now HighRadius was able to give us those numbers as well.

[25:54] Audience:

Regarding the KPIs but my collector, were you able to have different measures because is not the same as how you work with small customers or with a retailer. So, in this case, it is different the approach you have because you work on the websites, you’re not sending a Dunning letter for them. So how do you work with that?

[26:12] Audience:

Are you talking about invoices like being submitted to portals?

[26:15] Audience:

Yeah, because you could go to the portal working, the portal doesn’t really contact the constable.

[26:20] Tony Hiatt:

Actually, that is going away for us. We just signed our contract with HighRadius for another tool for the automated invoice portal uploaded. So that is going to be 100% automated. So when that does go on their worklist, they will reach out and call that team if we had an issue? Actually, you know, it’s human error. You put the information into a portal, sometimes you have to check back like a REBA, we hate it. You have to check back, you have to look and say oh, well they didn’t look at it or didn’t get submitted correctly, was the number thing something was missing that REBA needed in there with this automation. It’s totally taking that out of their hands and all they have to do is call the customer the invoice has already been submitted and it’s stamped in the collection cloud

[27:09] Audience:

Like CPA agents for now like a box that is actually so you have like CPA agents build like bots working with HighRadius on the website customers?

[27:19] Tony Hiatt:

Right now we have individual people putting those in. Now no we don’t have a KPI that says they entered this into a portal. We go off with the notes in the account.

[27:31] Audience:

Okay, thanks.

[27:35] Announcer:

Any more questions?

[27:37] Audience:

This is really interesting because I’m on the same journey as yours. We implemented FSCM with HighRadius. It is put in the IOP, ACA didn’t do that for that part, because, at that time, my customer was more European. Two issues. Multiple portals. Hard to upload invoices. The second issue we had was I had to filter our customers for dunning and dunning is a topic you know, not a lot people talk about, but that’s the future. Yeah. So if you have government agencies, you know, they don’t want collectors sending dunning that’s not allowed by laws. Do you run into issues where you have no filter customers?

[28:20] Audience:

Everybody’s straight across. We haven’t had any issues. Because I know Italy. Germany, you can do dunning. You have to be careful with Syria.

[28:30] Tony Hiatt:

Well, see all our dunning as I said, they are masks. They’re not just an automated tool, in the sense. I mean, when they reply to that email, it’s going to someone in that person’s reply. So it’s not like what you would think in the sense of traditional automation words and no reply email. Yes, that would be a hassle. But actually, it is us contacting them. And if they respond, it comes back to us. Does that make sense? So that’s how we’re getting past

[29:01] Audience:

On the invoice upload to the customer portal. So are you going to share your credentials to HighRadius?

[29:09] Tony Hiatt:

Yeah. We’re actually really looking forward to that tool.

[29:15] Audience:

You said you had 240 accounts to each collector, I think that’s how much they can handle. How did you determine what that number was? What were their KPIs or indicators?

[29:29] Tony Hiatt:

We went off of what they touched what the system did, because every three months, I sit down with my success manager here. And we go in-depth on what messages were sent, how many automation did how many the collector touched, and we kind of looked at our aging to see the reflection of that work in the balance decrease. So we kind of came to that number with HighRadius when they came and did a case study. Okay with us. That’s how we came up with, okay, it’s a comfortable number.

[29:58] Audience:

I’ve got 4000 accounts in two collectors. Right now, I’m trying to come up with…

[30:02] Tony Hiatt:

The automation honestly, they don’t touch 240 accounts. Okay? They touch in realistically, the system does a lot of it. So they probably work 20 to 30 accounts a month. But those accounts they’re working, they’re actually putting in the time. They don’t have to worry about the other ones they can take the time. So it’s about quality or quality, not more.

[30:33] Announcer:

Any more, Any more questions? Later? Wow, that was the most amount of questions we’ve had. All right. Thank you so much.

[0:00] Announcer: OK, so this session is 90% improved collectors productivity, how Ivanti improved cash forecasting and analytics using AI. Our presenter today is Tony Hiatt. Welcome, Tony. So a little bit about Tony. He is the global credit manager. And he has a privilege to work with Don. And he’s an experienced credit manager with a demonstrated history of working in multiple industries. So a little bit of information for you. So take it away. [0:36] Tony Hiatt: All right. Hello, everyone. I’m Tony. Hi, I’m the global credit manager of Ivanti. I’m going to share our story with you on the issues we had, the improvements we made and then efficiencies that we got out of it. So we’ll go ahead and start. So Ivanti, we are a software company, we do infrastructure, security, a lot of firewalls security setup. So 90% of the time your IT department uses our software. The basic steps that we took off for our digital transformation, our digital transformation at Ivanti how we enabled cash forecasting at Ivanti. The results that we have from that, and then the lessons learned after we were done. [1:30] Tony Hiatt: So, digital transformation, what we…

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    HighRadius Collections Software automates and optimizes the credit & collections management process to improve collector efficiency, minimize bad debt write-offs, improve customer relationships, and reduce DSO. It provides a complete set of tools to optimize and automate the credit collections management process and enable the better prioritization of credit collections activities All the information you need (invoices, dispute information, POD, claims, tracking info, etc.) on each case is automatically presented in a collections work-space and is ready for use. Apart from the wide variety of benefits that it has, it also comes with some amazing features like CADE (Collection Agency Data Exchange), collector’s dashboard which has prioritized collections worklist, automated dunning & correspondence, dispute management, centralized tracking of notes, call logs & payment commitments along with cash forecasting functionalities. The result is a more efficient collections team that contributes to enhanced cash flow and reduced DSO.