11 Proven Strategies to Reduce DSO


How Fortune 1000 companies and SMEs automate credit and accounts receivable operations to improve productivity and reduce DSO and past-due A/R.

Contents

Chapter 01

Executive Summary

Chapter 02

Customer Onboarding and Credit Approval Process

Chapter 03

Dynamic Scoring for Credit Review

Chapter 04

Improving the Invoicing and Payment Process

Chapter 05

Deciding Who to Contact on Any Given Day

Chapter 06

Collections Correspondence Strategies

Chapter 07

Doubling Down on Collections by Eliminating Waste from the Cash-Application Process

Chapter 08

Providing Research Ready Deductions

Chapter 09

Shifting Focus to Invalid Deductions

Chapter 10

Leveraging a Connected Platform for All of Credit-to-Cash

Chapter 11

Collaboration with Buyer A/P teams

Chapter 12

Accounts Receivable on Autopilot – Autonomous Receivables

Chapter 13

Summary

Chapter 14

About HighRadius
Chapter 01

Executive Summary


CFOs rightly refer to cash as the oxygen for business. However, despite leveraging various working capital improvement initiatives, organizations continue to rely on working capital loans According to a survey report by Hackett, debt as a percentage of revenue has increased steadily over the last few years from 35% of revenue for the period 2008-2013 to 51% today, a 10-year high.

Where is this cash stuck? Mostly, in receivables as DSO increased by 4%. For the fourth year in a row, DSO degraded as organizations pushed payment term extensions on their supply base.

Finance leaders worldwide have to therefore pay more attention to credit and collections to define better credit policies and drive teams towards proactive collections to improve working capital.

This e-book has distilled insights from our study of credit and A/R transformation projects at 300+ organizations on how Fortune 1000 companies and SMBs reduced DSO by 15%-20% by implementing these eleven strategies.

Broadly, the strategies are categorized into the following buckets:

  • How to reduce the credit risk of delinquent accounts?
  • How to build a more proactive collections process?
  • How to eliminate routine transactional tasks in credit and collections?
  • How to improve overall process efficiencies across A/R functions to refocus resources on credit and collections?