Driving Growth through Digital Transformation: David vs. Goliath

Brittany Shelley

Good afternoon, everyone and welcome to driving growth through digital transformation. David versus Goliath. Thank you so much for joining us today. My name is Brittany Shelley and I will be the moderator for today’s webinar. Prior to introducing today’s speakers, I wanted to cover a few housekeeping items. We are streaming today’s webinar via LinkedIn Live and Zoom. All participants are on mute. So if you have any questions, please submit appropriate comments or Q&A section. And we will answer as many as we can at the end of the webinar. Today’s session is also being recorded and we will be sending it out to all attendees following the webinar. We will leave about 15 minutes for Q&A and a quick poll at the end to capture the best way to follow up with you. I would like to now introduce today’s speakers. For today’s webinar, we have two industry experts with us.

First, I would like to introduce Sashi Narahari, co-founder and CEO of HighRadius. Next, I would like to introduce Rauli Garcia, Vice President of strategic marketing with Sage Intacct. Prior to diving into today’s webinar, we wanted to provide a quick overview of HighRadius and Sage Intacct. Rauli, I’m going to start with you if you could give a quick overview of Sage Intacct.

Rauli Garcia

Absolutely, thanks, Brittany. And thank you for having me on the call today, really excited to be here with Sashi and HighRadius and think that this is going to be a great combination. So Sage Intacct is born in the cloud financial management system, just like it says there. We were made by accountants for accountants. And that sounds kind of funny until you think about what it means to be a finance professional. So we’re native cloud: the first line of code was written in the cloud, for multi-dimensional accounting. And we’re here to bring the data together. And that’s something that Sashi is going to touch on when he talks about how API has transformed the ability to be a digitally transformational organization, or best of breed, fresh and modern user interface were built for CFOs. And I will say before we move forward that we’re the number one rated in customer satisfaction by the G2 crowd. We’re the first and only AI CPA preferred financial management solution, I mean the CPAs online understand that we have 2 top-rated awards and accounting and budgeting for ERP categories. So let’s go to the next slide. And we’ll just briefly take a look at some of the mid-market companies that we are serving today. I’m guessing that as you look through this slide, you recognize multiples of this, if you’re an athlete, everybody knows the Eagles got to love that. So I appreciate the time and I’ll pass it over to Sashi.

Brittany Shelley

Great, thank you Rauli. Sashi I’ll pass it over to you now to provide a quick overview of HighRadius prior to us diving into David versus Goliath. Sashi can you hear us?

Sashi Narahari

Yes, I can. Thanks. Thanks for the introduction. I’m Sashi Narahari founder and CEO of HighRadius. I had a Murphy’s Law happen as we speak, my camera is not working. So I’m going to connect the external camera and see if I can get there in 10 minutes, I apologize for not being on video. So just quick background about HighRadius. We are a software company in the order-to-cash and accounts receivable space. So we have about 600 clients globally. We have different offices, six offices globally to 2500 employees. And a late-stage fundraiser, we are a bootstrap company for a decade and build about three rounds of funding from ABC over the last two and a half years. And the market leader in the accounts receivables automation space. Next slide Britney.

Alright, so this is quick information for all of our clients. So we have broadly two broad categories of clients. And that would dovetail well into the presentation today. Enterprise clients, mostly fortune 1000 is what you see on the left. And then we have a lot of mid-market clients ranging from $10 to $50 million in revenue to $1 billion in revenue. That’s what you see on the right-hand side, you go to the next slide. So we have a very interesting strategy in terms of how we build our software. So we have actually one version of our software, a multi-tenant, a more modern platform of software as a service but we have different editions in terms of functionality. What you will see on the bottom left is what we call is the RadiusOne AR which is a be-up and running quick as well. For SMBs and mid-sized businesses, and then you can graduate from that to integrated receivables platform could be mid to enterprise. We have a lot of mid-market clients, let’s say you have like $400 million to $500 million in revenue, we are in growth mode, and you want to get to the end state

Then we have the autonomous integrated receivables, which is what a lot of our really large enterprise clients like ExxonMobil, and, and so forth have so we can think of this as the good old breaking the monotony of either you are big and you can afford SAP or you are really small, so you should use QuickBooks, and how do we bring this modern technologies and software as a service over the cloud, to companies of all sizes using one version of the code. But then the price points to the ease of use and the quick deployments from the left to right is kind of our go-to-market strategy. Next slide. Alright, so this is kind of the favorite part of my story. Like David versus Goliath, I actually come with an enterprise background, I used to be an SAP developer, and then SAP consultant. And I’ve worked with a lot of CFO offices transforming their finance functions. And I’ve seen like millions of dollars being poured. And I think it’s a very expensive way to transform a department. So one of the goals that HighRadius, is how do we really completely disrupt that journey? And how do we bring that to both enterprise clients as well as small and medium businesses to mid-market?

So the next slide here, kind of shows the trade-off. I think, if you think about it, I’m sure on this call, we have mostly mid-market businesses, but also probably some fortune 1000. But I always feel like the mid-market companies are always told you should do this, you should do that you should do the disrupting study, they but the reality is, if you compare a fortune 1000 to a mid-market company, they have budgets in millions of dollars, a typical fortune 1000 company spends about 3% in IT. So if you take a $10 billion company, they have $300 million at play, right? To do something. And then they have like dedicated CFO staff, split by various functions from Supply Chain Finance. They also can afford big consultants all the way from McKinsey’s to Deloittes and so forth and Accenture’s. And if you compare and contrast that to a mid-sized business, that’s not the reality, you do not have a dedicated staff for doing project improvements. Maybe you have some you have IT staff, but it’s minimal. And they’re always overburdened by a fee. So a lot of the CFO teams that we work with, they’re kind of like almost like burning Midnight Oil closing books over the weekend, month, and it’s a never-ending game. So it’s not apples to apples, even though you are able to think strategically and you want to get to the strategic aspect of the business, you don’t have the resources that the Fortune 1000 has. So how do we then transform a mid-market business, given that you don’t have the same resources, that’s the story of the presentation today? Next slide, Britney.

So I think there are some very interesting drivers that are a level playing field between a large enterprise that has big budgets and big staff to small and medium businesses today. So one is cloud, delivery of software of the code over the cloud. If you think about SAP as an ERP software or Oracle, monolithic, expensive, that is completely changing. And Salesforce is the one that has disrupted it. And then AI in terms of how it can bring automation. And then another third concept called API, which we’ll talk about, which is the connectivity of this cloud-based application. So these three trends that are happening are what I believe is doing the level playing field between David versus Goliath, the mid-market to the enterprise companies. Next slide. So if you just think about Sage Intacct, is a very modern cloud-based ERP system. Then we’re very excited about working with Sage and Rauli’s team here because they provide a modern API ecosystem of plug and play. So a technology like HighRadius is seamlessly integrated into Sage Intacct, and you can just go from Sage to HighRadius quickly and then orchestrate all of the AR business processes and backend Sage. So that way, as a mid-market company, if we compare that to an enterprise market where you have to have deep pockets, where it’s very different now, you just can quickly activate and get value in few weeks. So that is mainly enabled with the APIs, the application programming interfaces, where and I’ll kind of show you a few screens shortly of how you can quickly activate HighRadius within that ecosystem. Next slide. So I guess the summary of that, why now? A perfect storm for digital transformation. I think cloud computing is almost expected. The API ecosystem provides the automation and productivity and then the AI revolution which you all know of, how can we drive more automation for you? And then the COVID is kind of interesting. In that, it has become an accelerant given the pandemic, remote work, work from anywhere. And then if you want to make sure that your employees are effective and productive, but more importantly, also like how can you effectively measure the productivity? So those are the evolving trends. Next slide. Alright, I guess it’s back to Rauli.

Rauli Garcia

Thanks, Sashi. Excellent. All those pieces add together, to start to have a discussion with us about what it means to your organization today, and where you are, and how you can start to embrace digital transformation. So let’s talk about digital transformation. Really, if you look at this pyramid on the left, these are today’s processes. And most of the finance departments with which you probably work today are like this, where up to 50% of the time is spent on transaction processing. 20 to 25% of the time is spent on reporting another 20 to 25% of the time spent on controls, leaving you the ability to think strategically, you’re just playing think, only 7%, maybe. And I know that there’s a lot of people in the audience here sitting there thinking, Man, I wish I had 7% of my time to think strategically. So what can we do about that? This is a typical pyramid, and especially during pre-COVID, it became really, really evident that with your company built this way, with such manual processes, that in spending the time processing transactions, ensuring that you had accurate data, and pulling together information for reporting from different places, you weren’t able to pivot as fast as you want. So what can we do? Well, we need to think about how we get, to the triangle on the right, where we can spend a majority of our time thinking about strategy, which is where we all want to be in finance, all CFOs and controllers and accountants that I know, want to elevate, become strategic partners in the organization and earn a strategic seat at the executive table by adding financial value to the organization. So how do you do that? Well, Sashi already mentioned that if you’re a Goliath, you can throw a bunch of people at the problem and probably solve it. But how do you compete if you’re mid-market? Or how do you compete even smarter? In a more smart way, if you’re a Fortune 1000 company? You do it, by maximizing the use of technology, you automate as much as possible, even letting the artificial intelligence and machine learning embedded in the software, help you get to where you want to go even faster, through digital transformation. So let’s go to the next slide. And we’ll talk about what that really means in practice. So this should be very familiar to everybody. So everybody on the call, probably at some point, used that piece of paper on the left, that’s called a map. That’s a paper map. When’s the last time you saw one of those? Hey, Sashi. There you are, you’re looking good, man. I’m going to come on camera now that you’re here.

Sashi Narahari

Finally, out of Murphy’s Law,

Rauli Garcia

There you go. So, okay, maps. So think about how your business is structured today, and how much time you spend doing reconciliation and checking data, and tying things together? It’s a manual process, it’s like looking at a map, it’ll tell you sort of where you want to be. But if it’s changing, your map doesn’t change automatically. And you can see where you want to go. But you have to plot your own course. If you can implement the right technologies in the software in your business, you can really evolve it. So that a lot of the things that we just mentioned, become automatic. And when you do that, and you get the experience of moving to something from maps to Google Maps. Now I prefer ways that you may love Google Maps. My son loves Google Maps, I think he does it actually, he just told me he uses Google Maps because I use Waze. He’s 17 years old. So think about it though, what can Waze do ways not only tells you where the addresses and where you’re going, Waze can tell you how to get there, it can tell you if there’s a police person on the road, it can tell you if there’s an accident, it can make recommendations for two or three other ways for you to get there. And it can route you to a different way in real-time to help you get to where you’re going. That’s what we want to do with our technology. We want to build a technological ecosystem and start organizations that support us by doing all the manual work that needs to get done allowing us to think critically and strategically about how we move the business forward. So let’s go to the next slide. And we’ll talk about how we move from doing manual tasks to use digital workflows to get the same results.

So easy way to do it is to find a process that’s well documented, that is well defined, make it faster, automated, manual approvals to automate approvals. That’s the easy way to do it. So let’s go to the next slide. And this will make sense to almost everybody. If you haven’t already made this transition but just imagine when you have to get something signed for a PO approval. So I used to be the chief administrative officer for the Houston zoo. It’s a $60 million company a 55-acre campus and has something like 500 employees, it could take an entire day to get the signatures done on something like that. Because you had to start the paperwork off, it could go to one building go all the way across the 55 acres and come back around, search for people you never knew, who was going to be where, and when what a huge pain that was. But I also took the opportunity while I was there, to get a new ERP and take the organization through a digital transformation just like Sashi and I are talking about and I installed Sage intact, actually. So you go to the next slide, we can talk about what that meant. So we went to paperless workflows. Imagine that, okay, so you create your PO, you send an email over there, no matter where the person is, who needs to sign that document, digitally, they can pull up the email on their cell phone, hit the button to approve, and you’re done. You can do it while you’re sitting in line at Starbucks. You can do it while you’re feeding Lions, you can do it while you’re examining the elephant cages all over the place and it happens immediately. Think about the amount of productivity that gets on least when you don’t have to track somebody down. I know we’re talking about one person who’s doing the signature run. But that’s not just for one person. When you automate these workflows that apply across the organization, it means it’s a tremendous difference. Let’s pick another one, let’s go to the next slide.

Time entry, how many people punch the card before? So I did it when I worked in the restaurant business. Number one, there’s always a line when you’re supposed to check-in. And you’re also exposed to fraud by other people punching cards for other people. So let’s think about it on the next slide. What if you are a consultant and you have billable time? So this is what your day may look like you start meetings at 9 am, you have your first presentation at 1 pm, your new emails, you have another presentation at 4 pm. If you’re lucky, and you’re incredibly proactive, you take the time at the end of the day to allocate your time to the proper accounts. If you’re like most people who are not, and don’t have the time to do it, you wait until Friday, or you wait until Friday night and you carve out a bunch of your day that you’re not being productive. You’re not adding dollars to the bottom line to do your timesheet. Or if you’re really bad and I noticed that people like this, you wait till the end of the month. We estimate that it’s up to $10,000 per billable employee per year in lost time. So what do we do in Sage Intacct, we created an AI tool if you look at the next slide that will watch what’s your systems and make suggestions on how you should allocate your time. It’s powered by artificial intelligence. It will say at the end of the day, here’s how I think you should allocate your time you say ‘yes’, ‘no’, or you just do it manually. Imagine the amount of time that saves the person who is actually going to be billing those minutes and hours. It’s a huge time saver. And for finance folks, like we have online today. How much do you believe and trust what they’re submitting? If they’re handwriting that stuff. It’s challenging, but the AI tool can help it be much more effective. And you can trust it much more at a deeper level. And speaking about trust, we’ll go to the next slide. And we’ll talk about how do you look at your GL. So Sage Intacct implemented something called outlier detection. What does that mean? So your accounting group is probably looking at every transaction or trying to look at as many transactions as they can to ensure that those transactions are correct. They’ve been built in the right place, you’ve managed the risk in them. It’s an incredible amount of transactions in many organizations. And when you start to get up Sashi like you’re saying into the Goliath, you just keep hiring, keep hiring, keep hiring. Well, that’s expensive. So what can you do: buy a piece of software that helps you do it, the AI inside Sage Intacct, we’ll take a look at your transactions and learn what’s appropriate in your organization over time. And then, as you can see in this little red box, it’ll bring transactions to your attention that it thinks you need to review because there may be risk associated with it. For example, let’s say me, for example, Rauli, let’s say I’m in your motor pool, and most of my transactions are $250 to $300 in billing and maintenance. Well, one day that AI tool surfaces up a transaction by Rauli that says he’s built $15,000 into a consulting group. Okay, that doesn’t look normal, it may be fine, there may be something there. But the important thing is that you don’t have to comb through 100s of 1000s of transactions to find that. The AI tool surfaced it for you and made it that much easier for you to do it, giving you time to do other things. So let’s go to the next slide for a really important quote.

“I have too much time to think now.” said no CFO ever. So I’ve been the CFO of three companies. And I can tell you the only time that I had to think, was when everybody else was gone. And I know there’s a lot of people on this call today, they’re shaking their heads, I can see it even though I can’t see it. Shaking your head saying, I know exactly what you’re saying Rauli, who’s got the time. And then actually, when everybody’s gone, nobody cares. It was pretty lonely sort of felt like. So what we want to do is do whatever we can to give ourselves more time to think, in a reasonable time during the day. And so what does that mean? Go to the next slide, we’re talking about moving from manual to digital business models, getting rid of the old models, with reconciliations and having a look at every transaction, and verifying everything to new business models where we automate as much as we can. When we do that, and we do it for the right reasons, we can allow our people that elevate and be more strategic. I always say that, if you can do this, what’s the value in your finance department, it’s not sitting there creating spreadsheets, we can hire people that are just out of college or even high school. What we want to do is let them apply their expertise to the organization. I was really hoping that I’d be able to get the accounting department out from behind their desks, and now into the organization where they can really learn the business models for each of the departments and then offer advice on how they can elevate those departments using financial strategy. So if you can have a human-centric digital transformation, which is focused on the human and not the technology, it frees up time for us to do higher-value work. But what about now? So how do you move forward? Well, let’s talk about some key ideas. Let’s go to the next slide. So digital transformation can help you compete with Goliath. Sashi talked about it. And it’s true. If you can’t throw people at it, be smart and use technology to elevate your folks and let them do the business that they can really add value on. Going into the cloud is a democratizing driver. So if you can do many no one, there are all kinds of efficiencies of scales and learnings that tools, artificial intelligence tools, and machine learning tools can use to help you automate your business and provide a better service. You’re doing that small incremental changes can have transformative effects on your organization. We talked about whether it’s one person who’s looking for signatures or multiples, those hours add up quickly, and can add to the bottom line by elevating how they work.

We know that digital leaders outperform their peers. And we know that human-centric digital transformation helps the people you work with by putting the time into the work that they really love and think and get their lives back. We get examples, the controller after we implemented the ERP at the zoo, was spending 13 hours a day during the close on the close. After we got done, she was only spending about nine, she was able to eat dinner with her family and actually get some exercise she really liked that. Okay, last slide for me.

What can you do today? Well, take action. First of all, understand the existing technology ecosystem in your business. So what does that mean? Many organizations buy a piece of software and they use about 10% of it. So you may have AI technology, ML technology already in place in your organization. Figure out what you have and how to leverage it and get the most out of what you have. Then take a step back and put a plan together. Think about your digital strategy. Think about where you want to end up two to three years from now, get the other stakeholders involved, and design the new processes. But the important thing is, don’t try to eat the elephant one bite, pick one bite and take it to identify one area for change that can deliver a great impact and do it quickly. Just like HighRadius, Sashi is going to talk to you about a second, what we want to do is earn the right to move forward on the next project. So articulate the strategy to the whole organization, get buy-in from the top, and then pick a project that you can be successful at and kill that one, then go to the next one, the next one. Before you know it, you’ll have made a huge impact on the organization. The way you do some of that is by measuring it, making adjustments, repeating, and then communicating that back into the organization. So they can actually see that you’re making progress one step at a time. Finally, find a partner like HighRadius can help you execute and get some quick wins. What you want to be able to do is show that you’re not doing this on your own, and you have expertise in place, people that have the experience to show you the right way to get it done. They can also show you how to introduce the value to the rest of the organization that the technology is providing. So Sashi, tell us a little bit more about HighRadius and how that happens.

Sashi Narahari

Thank you, Rauli. Alright, so what I would like to do now is kind of more like visual evidence, a topic that I’m very passionate about. I’m a techie, junkie, and Product Manager first. So, as I said before, I’ve seen transformation projects in years, millions of dollars, and very passionate about bringing that to weeks and something that we keep pushing our teams of product management teams and the engineering teams. I want to show you one use case, which is how can a small and mid-market business take a function like collections for a year, and then rapidly transform that in six weeks? So how can we make that happen? More evidence of that? So this slide here is just a high-level overview of the HighRadius Radiusone AR suite.
It has three products, the credit risk, to help you with online credit application with your new customers, pulling the credit data from agencies, and then how do you do like automated credit scoring so you can quickly approve them? The product that I’m going to talk about today is the e-invoicing and collections application where you deliver invoices to various portals could be AP portals to Arriba, Cooper whatsoever, or electronic delivery. How do you accept payments in various formats, and then also automate any past due to collections and so forth? Then the cash application or cash reconciliation app is more around how do you take the bank statements, not just the deposit information, but also the line item data, the remittance item data, capture it from email, capture it from check backups, and, and then auto-match to your open invoices in Sage Intacct as an example. So the next slide here, I’m going to give you the visual of the solution architecture. So if you think about ERP, being Sage Intacct on the left, all we need is to open AR into our system. Using that we have an automated prioritize workplace versus user spending a lot of time and how do you automate correspondence, dunning past due reminders, and then also activate native voice calling in the system. Then, of course, you deliver the invoices via emails, you deliver them to portals, and then also accept payments, whether it is a credit card or other form of electronic payments easily so you can get your money faster. So then you have your end customers on the right-hand side.

So let’s kind of jump in here the next slide, just a quick visual. So the most important thing I think when you think about most implementations, why they take a lot of time is integration. So Sage Intacct is unique in that it allows easy API-based connectivity, which requires minimal to literally no IT involvement and no maintenance from your side. So the next slide here will actually show you the visual of how we do this in HighRadius. Basically, if we go to the administration tab, we are building a ton of out-of-the-box integrations to banks, ERP systems, Sage Intacct is one of our top priorities. So you go to manage integrations, click Sage Intacct you go to the next slide. Then what happens is the API base integration pulls all the open-air data into the system. And we have a certain set of criteria, whether it is company code-based and so forth. But in essence, all the data is automatically there. This is where if you talk about the David versus Goliath story, there is a lot of time and money spent on integration. We wanted to completely change that. So once you have the core AR data, or the invoice data electronically, the system, the next slide here will tell you the day in the life of a collector, so easily simplified. As soon as your collectors get to work, they don’t need to do any excel, pivots, prioritizing, reporting, aging analysis, the system will tell you whom to contact. This is where the power of data-driven systems comes into play. Where we know the customer payment behavior, we know when they’re breaking promises, which invoices are past due. We relate to prioritizing whom to contact, which is the first column near the customers. We also provide the suggested actions with you: should you call them or you send them a letter, maybe like a final demand letter to maybe a simple light past due reminder. This is all based on the data-driven system and collection prioritization. And then always obviously, at the top of the list would be making calls which could be severely past due high dollars that requires the person’s attention. Then really low dollars, just a gentle reminder email that can be automated from the system.

Rauli Garcia

Can I say something? I love this. This is awesome. This is exactly what I’m talking about, how many transactions and would we have to go through to get this kind of information, how much work would it take, and your tool does it for you. This is exactly what we’re talking about. This is what you need to have to be able to be a company that’s embracing digital transformation.

Sashi Narahari

Absolutely. Then the system is also self-learning. So as your customer’s behaviors are changing, and maybe there is somebody who’s a good paying customer is becoming a bad paying customer or vice versa, you don’t want somebody figuring that out and setting up different rules. So the system can have auto learns and corrects itself. So the next screen here will show you how you can set up the system to send automated emails, or you can just spot check the entire worklist, bulk select and say send different clients of ours or different preferences. I recommend once you get comfortable with the system set up auto correspondences. But the system is directly sending emails to your customer that are like clean emails, it could have a PDF attachment of invoice copies, statements, balances, and so forth. But more importantly, if you see the pay now button, you’re making it really easy for them to pay, it’s almost like a call to action versus they just get a one-way email and they’re to initiate independently to pay you and you don’t know if you’re going to get anything. So they can click on Pay Now, and then make payments via a credit card. Again, this is based on the policy of your business, what are you willing to accept, you can also segment your customers, and so forth. Next slide.

So next slide, then imagine the 80-20 rule 80% of your customers that need to be contacted. The email took care of itself, automated. So the machine did the work. The 20% of the customers are based on the capacity, if you have like two people in AR, there are only so many calls that they can make in a day. How do you make sure that they can immediately call so they go from screen one to literally call, no offline work? So you select the customer and you say call and you start taking notes. So we have in-app dialing, within the system. As you know everybody is using Voice over IP as it’s a new standard that’s all integrated into the system. So it’s not picking up their phone and calling because you also want to track how many calls they are making? What is the effectiveness? Are most of it is going to voicemail? What percentage of the time did they spend on the phone? All that good stuff. Next slide. Yeah, so I think that’s kind of the summary. I think our vision for the small and mid-market business that I’m very passionate about and we are threading the needle is, how do we fast track this deployment as quickly as possible? I tell our engineering team, six weeks is still a lot. But we also want to be practical. So we are threading the needle will probably bring it to four weeks and we look at every friction point of implementation. How do we eliminate that? Having that plug-and-play, an out-of-the-box solution is a key to having the out-of-the-box integration. So you don’t have to go to your IT to ask for a File Export and so forth. HighRadius has done over about 1000 AR transformation projects over our decade-plus journey from small businesses to enterprise businesses. We have a lot of learnings and how we can bring all those learnings and package them and set up the system. So we don’t need to sit down with you with an empty shell, saying what do you want to do with AR today? We already have the default best practices of 1000 plus AR transformations built into the system. And of course, via configuration, you can change some of them. Then of course IT is, in a positive way a bottleneck because they’re always under thinly spread. They have a lot of priorities. So how do you minimize it? And then mainly focus on getting to the business needs to be up and running. Next slide. All right, I think that’s it. So we are here to take questions. Rauli and I so feel free to shoot.

Brittany Shelley

Yeah, thank you, Rauli, and Sashi. And thank you to everyone for being a great audience. While we start to take some of the questions that are coming in, we are going to launch a quick poll to capture the best way to follow up with you. If you can take a few seconds to answer the poll, then we’ll start to take the questions. I have seen a few questions come in. So we’ll try to answer as many as we can. If there are any questions that don’t get answered, we’ll make sure to follow up with you after the webinar. So the first question that came in Rauli, I might ask you to answer this one. If most of my process is manual today, where should I actually start with digital change?

Rauli Garcia

That’s a great question. And it’s one that I get asked every time I do a presentation on digital transformation. I think it’s really important. That’s what I’m talking about, understand what’s in place today and figure out where you can add value very quickly. I love what Sashi said about the ability to help you manage the risk in your organization and really help your AR team, understand how to allocate their time, that can be a huge time saving right there. There are other places like that. So it’s always for me to get a sense of what the technology ecosystem is, and what tech or what software you have that you’re not maximizing? That’s where I always start and then figure out how you can get that first quick win. Sometime’s you can do that internally without buying a new piece of software. But what the important thing is, is that you’re talking about it and you’re getting it socialized in the organization, because one of the big challenges in digital transformation is just leading it. You have to have buy-in at the top of the organization. From then top-down, people have to believe in it. And so when you can find that first one, whether it’s internally or not, do really well there and communicate, communicate, communicate. That’s what I think.

Brittany Shelley

Great, thank you, Rauli. Sashi, I’m gonna ask if you can take the next question, which is, can you dive deeper into how AR automation can help reduce late payments?

Sashi Narahari

Okay, good question. I think let’s kind of think about the root cause of why late payments happen, right. Of course, there are companies that want to pay late, so that they keep the money in their bank longer. But they probably don’t do that with all the vendors, right? They probably do that with the vendors that are not effectively communicating with them. So I think in essence, the driver for making sure that you get payments early, is making sure that first: the invoices are being delivered and acknowledged. And then you’re doing a good constant follow-up in some form or the other. So there is no excuse of, ‘Oh, I’m not able to pay because I didn’t get the invoice’. So it’s a combination of emails, and then, of course, your phone calls back to them, getting the promise to pay commitments. And then finally, every company has different preferences on payment methods. So how do you offer all of the various possibilities based on your policy for this credit card as an example, it’s easy, but you have to decide if you’re okay to take the per merchant fees. So in essence, digitally interacting with your buyers, that you can scale, I think can definitely make a huge impact on DSO, almost every one of our implementations, one of our number one goals is to reduce the DSO that’s measurable, we start with the as-is. We say like what’s the ‘to-be’ and we call it a lagging indicator, and how can we get there?

Brittany Shelley

Great. Thank you, Sashi.

Rauli Garcia

Hey, Brittany. I think something else would be a good answer to that question. So, in three of the organizations of which I was the CFO, the first thing that I did was figure out what data was available in the systems that I had today? So inevitably in organizations that haven’t transformed digitally, those buckets of data sit in silos. As a strategic CFO, a data-oriented CFO, a data strategist, you want to be able to bring those together, so you can pull the data together to make some really interesting decisions. So the first thing I did was understand where the buckets of data lived, and how to bring them together. When you talk about digital transformation, I lived it. Because when I first did it in 2008, I had to have one person, I hired a person whose job it was to pull the data together. And that’s all he did was make sure the data was accurate, and stitch it together in Excel, so that we could apply it to our strategic plan and use it for strategic decision making. That’s a great first step because then you can start to show your organization, how having the data in one place can help make decisions for the organization. Once you get that loaded, and you’re socializing it, then it becomes a conversation about how do we do this in a more effective way, and ensure that it’s more accurate since talking to the finance people again, on the call, we all deal with fat fingers and broken Excel spreadsheets. That’s a nightmare, a nightmare, especially if you’re a large mid-market company, and you’re still functioning off of spreadsheets. That’s pain times 10. So figuring out how to automate that and bring your data together, for example, with the APIs that Sashi mentioned before, that’s one of the great things about Sage Intacct. You can bring your operational and statistical data into the GL. So you can apply that data to your financial data and create something like the number of chimpanzees per person who comes into the zoo. I think it’s kind of crazy to think about it that way. But being able to understand how your operational decisions are impacting the financial decisions, and doing it quickly, effectively, and immediately, was a huge strategic advantage when it came to COVID and being able to provide immediate and accurate forecasts to the CFO and board on how you’re going to deal with some of the things that are crazy. Just like your employee base, your real estate, pulling that all together with the financial data can add huge value to a company. That’s the next stage.

Brittany Shelley

Great, thank you, Rauli. So the next question that we have come in, Sashi, I might have you start with this one. And it is what are some of the leading metrics and indicators that finance leaders should be tracking to stay proactive and 2021?

Sashi Narahari

I think it depends on the function. Maybe I’ll focus on my area of expertise, although I’m also a CEO of a company. So expect a lot of stuff from our finance department. I think from order to cash and AR standpoint, the key metrics are day sales outstanding. Of course, your payment terms could be different based on the nature of your business, also having some weighted average days delinquent, and so forth. Then, of course, you don’t want to just wait on the lagging indicators. The lagging indicators will take some time if you’re on an improvement journey. So there are also certain leading indicators like the productivity of collectors, number of emails sent per day, number of calls, percentage of talk time, stuff like that. Feel free to send an email to Britney, we are happy to share some of these metrics and definitions of them. There is also some advanced metrics called collections effectiveness index, but it depends on the size of your department. And then maybe I’ll turn it over to Rauli about overall CFO function, key metrics.

Rauli Garcia

Oh, well, I’m gonna put you back on the spot, get ready. Sashi. So you’re a CFO of a huge company, it’s a global organization, do you have a dashboard that you want to see every morning when you walk in the door, and you may not, but that’d be good to just sort of brainstorm about it. Because I can tell you what I do every morning, I literally look at about 30 dashboards every morning. So Sage business has a marketing function that’s very large, we go to market through vertical, multiple pieces of software. And we track our marketing and sales funnel very, very, very granularly. Since that’s my purview right now, is across this global organization, for me segment demand generation, every morning, I look at the data in about a million different ways, it’s probably too much for most people. But when you get into the habit of looking at your data every day, then looking at the data doesn’t become a hard experience, because you start to understand what the expectations are for what you should see. So that when something deviates in a way that you don’t expect, you pick it up immediately. But if you haven’t had taken the time to work with a company who’s worked with other companies like yours, and they can tell you, ‘Hey, this is best in practice for your company, as a vertical’. We’ve worked with tons of companies like yours. This is what the metrics are like Sashi was saying. These are the metrics that we think are really important for a company like yours that you should be looking at. That’s a great starting point, to give you something to hold on to, while you go through the process of figuring out and working with your CFOs and your CEOs and your boards to help them understand what they want to see on a regular basis to help them monitor the effectiveness of the business. So Sashi didn’t mean to put you on the spot. But I’d love to hear what your thoughts are.

Sashi Narahari

Yeah, I love being on the spot. So we have eight leadership principles, one of them is HighRadians on the call notice is called ‘numbers don’t lie. That’s one of our leadership principles. We have a custom portal at HighRadius called HighRadius 360. It looks very similar to LinkedIn. Then if you if you’re an employee, you can log in, just like you can on LinkedIn, look up people where you can find me find any HighRadian 2500 offers. As soon as you click, as you will see our metrics and performance. So we kind of call it like, transparency from the top builds clarity for everyone. So yeah, we measure everything. We’re not about it’s not about like how are you doing or not kind of stuff. But everybody, every individual needs to be honest with themselves, about their own performance. Be it myself by showing my own performance. And I share the good news, bad news, once a month, with email, what I’m doing well, what I’m not, and I expect the same from the next-level leader. So it’s a very unique culture changer for us. It’s it drives a lot of high performance and actually is very positive. Because we don’t see something red as negative, we look at it as an opportunity to improve.

Rauli Garcia

That’s really important what you just said, so many people that I’ve talked to when you when I have implemented those strategies about being a data-driven culture, because their previous history in organizations, they are afraid of the data because the data has been used as a club to get them in line. My experience is that with good leadership, the data doesn’t become a club, the data becomes just a tool. And the tool is meant to help you understand where you are today versus where you want to be. And then drives the discussion about how do we collaborate to build a better outcome. We’ve implemented that in many of our verticals to great success. But we did have to set the expectation that this is not meant to be a witch hunt. This is about all of us being on the same page for what’s happening in the vertical. What does the data say? And once we get aligned on what the data says we can have a conversation about how do we change it?

Sashi Narahari

You bet.

Brittany Shelley

Great. Thank you. But we have another question. Especially I think I’ll let you start with this and then Rauli if you have anything to add. The question is how do you manage the customer reaction towards a new implementation? And how can companies measure customer satisfaction?

Sashi Narahari

Yeah, very good question. So I think that what I’ve seen is the customer reactions are different across the board. I think it’s mainly because of your expectations. I think as software vendors, we need to do a better job and understanding your situation. But I think there has to be clear expectations from the beginning on implementation timelines, complexities, if you want something very specific for you, and change the configuration, but it will take more time. If you’re okay with the out-of-the-box. And I think it’s just like every human has a different personality, I tell our consulting team, you have to treat every customer as a different personality and have an open dialogue. In terms of measuring customer satisfaction, there are different metrics, we actually do a C set survey, there is an NPS score survey. Of course, one of the best metrics, I think, is customer churn, which is, if your customers are not happy with you, then they should fire you. So that means you will have a revenue leakage and our customer success help, her name is Natalie, we change the title to customer value. Customer Success is too broad. So we’re going to make your key metric churn, which is like when we sold x million dollars of ARR as an example, what percentage of it was retained? Right? Is it new? For most, we are very lucky, we have been in a good spot. But yeah, I think those metrics matter. And as customers, you should always challenge your vendor, but also collaborate with them, if they beg to disagree on certain aspects and they challenge back with you. Rauli?

Rauli Garcia

Sashi, I agree with everything you said. I do have experienced with that when I worked for a company back as a value-added reseller for Sage Intacct. We did many, many, many implementations of the ERP. And our experience was the same. The most important thing is communications, setting expectations out front, and then having a good process-driven project manager to communicate how the project was progressing, and make sure to anticipate questions and needs as they arise. Just like you said, sometimes you’re in the middle of an implementation, and somebody asked for something that really isn’t realistic. I mean, it happens. I mean, you just have to be able to say, here’s, here’s the plan, here’s what’s realistic, here’s what we can provide you, at this point, sometime in the future, we can address that, or that’s not something we’re capable of doing at this time. So communication, communication, communication, documentation, documentation, documentation, and that discussion about best practice is really important, because you’re the people that are implementing the software should not have to invent the wheel. What you want is a partner, who has been there done, it can tell you, ‘Look 95% of what you want, we can show you immediately’. Then we need to figure out through a good conversation and needs analysis. What are the parts on the margin that are going to help you be successful in your business? And then execute on that. That’s the way I would think about it.

Brittany Shelley

Right, thank you both. So we have time for one more question. And I think both of you should be able to provide good insight on this. But what are some ways in which financial leaders can avoid digital transformation projects fail?

Sashi Narahari

I think I’ll give you the top two reasons for any IT project failure. I used to be a consultant in my career side as a developer, then a consultant and had my share of failures, actually. So the number one reason for project failure is we call it solution design. A lot of us think about it as a requirement. But I think it’s like given, what are the requirements could be different, right? Everybody could say this is my requirement r1, r2 r3, but then the solution architect team, who’s designing the solution to your requirements, and how do you come together? Clear alignment of that in a good positive effective dialogue during the design phase, doesn’t necessarily mean you adopt and give all the requirements, and you sign up for a document. Then it throws in its a closed-loop process. The number two reason for project failure is I think Rauli, you alluded to it is project management, creating timelines, projects, and milestones, and clear roles and responsibilities. I think everybody needs a bad cop to keep us honest. So you need strong project managers who are not afraid to call out the vendor or the customer in the right way. So bad cops need a good style of operation. Like where you kind of respect them. I think those are the two things. The top two reasons why projects fail.

Rauli Garcia

So I agree. And I would add to that because my career hasn’t always been great. I’ve gone through problems like this before and I’ve taken the bite out of the rear end on that. For me, it was making sure that I had gathered everybody’s feedback and collaborated on the decision to execute the transaction. That’s what when I talked about coming up with a plan, socializing with the executive team, making sure leadership’s on board, and having it actually lead. If you don’t have someone who leads the digital transformation in your organization from the top, like Sashi, if your CEO isn’t leading it, then it’ll get challenged. Because in the beginning, there are a couple of things that happen. Number one, if you haven’t read the book, ‘Who Moved My Cheese’, it’s all about change. When you do digital transformation, you start to move a lot of people’s cheese. It takes communication and a little bit of love and tender care, to help them understand that their lives are going to be better after you move their cheese. That’s one thing. Then the second thing is that when you know everybody’s going to be happy about it because people get used to what they’re doing. But when everybody is rowing the boat in the same direction, this is a terrible cliche, but it’s true. Whenever everybody does that you move faster. When inevitably, in these projects, there’s going to be a slight hiccup, something where somebody has to take a step back, and you have that project manager that says he was just talking about who has to sort of corral things, bring it back, get it back on track. It’s really easy for someone to throw their hands in their pitch of fit. So we all need to be on the same page that this vision that we have for digital transformation is going to elevate the company, not just the finance department because it’s not just a financial transformation. It transforms everybody, it makes everybody in the organization better. It gives everybody in the organization more time to think. And it gives everybody the ability to add more value to the company.

Brittany Shelley

Great, thank you Rauli. So we’re coming up on time now. But before we close out, I want to thank everyone for joining us today either via Zoom or LinkedIn Live. If you do want to learn more about HighRadius or Sage Intacct, feel free to reach out to me directly and I can get you in touch with the right counterpart. Again, thank you, Sashi and Rauli for a great presentation today and I hope everyone has a good day.

Sashi Narahari & Rauli Garcia

Thanks, Brittany. Great job. Thanks, guys. Bye