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Credit management automation: the gateway to successful Order-to-Cash

Eva van der Grijn

Eva van der Grijn

29-08-2023 7 mins read

Why Your Credit Team Deserves Some Credit: Exploring the Power of Credit Management Automation 

Navigating through numerous data sources to assess creditworthiness is no easy task. With rising credit risk profiles due to fraud, non-compliance, geopolitical uncertainty, and economic challenges, it's crucial to acknowledge the importance of your credit team. They serve as the gateway to smooth operations and satisfied customers, and credit management automation plays a key role in enabling their success. 

Despite operational and global hurdles, every company aspires for growth. The correct onboarding of prospects and regular monitoring of existing credit customers are vital processes in this journey. However, conducting thorough due diligence demands time, accuracy, and urgency. This places immense responsibility on credit teams to help achieve business objectives such as revenue growth, cash flow protection, improved working capital ratio, and enhanced customer satisfaction while minimizing customer churn. 

Delve into the transformative impact of proactive credit risk management through automation and digitization. By embracing these technologies, your credit team can provide the transparency that both the business wants and needs, empowering them to deliver exceptional results. 

Give your credit team credit they deserve with Credit Management Automation 

It's puzzling why credit teams don't receive the recognition they truly deserve, considering the significant reliance placed on their efforts by both internal and external stakeholders. However, there's often a lack of clarity surrounding the decision-making process and the criteria upon which credit decisions are based. 

Manual handling of credit and risk activities can hinder the ability to demonstrate in a structured manner how credit recommendations are formulated and the quality standards of due diligence employed. As the demand for credit risk assessments grows, along with the need for high-quality source data, manual processes often compromise both the quantity and quality of due diligence. This can lead to frustration among stakeholders, especially sales teams eagerly awaiting order fulfillment. 

Credit clerks embarking on the credit risk assessment journey, particularly during prospect onboarding, are aware that a significant portion of their valuable time will be spent sourcing data. Only when the required data sets are in place can a comprehensive analysis be conducted. The specific documentation needed to complete a credit analysis may vary based on the business's credit policy. However, the longer it takes to gather data, the more outdated the credit analysis becomes, introducing new challenges. Hence, the urgency to deliver valuable credit risk assessments based on the most current data is crucial for credit analysts, though not necessarily easy. 

Manual analysis of the amassed data is time-consuming. Data sets must provide meaningful insights that enable the assessment of credit trading risks. Yet, the pressure from the business to expedite this process makes it nearly impossible to achieve the desired level of transparency sought by numerous stakeholders. Consequently, even though credit teams cover all the necessary steps to adequately safeguard the business from credit risk, it's often the manual processes within the organization that hinder the objective of swift and accurate due diligence. 

To address these challenges and truly recognize the credit team's contributions, credit management automation emerges as the key. By harnessing the power of automation, credit teams can unlock their full potential, streamline processes, enhance transparency, and deliver timely and precise due diligence. It's time to empower credit teams with the tools they need to succeed and ensure that they receive the credit they rightfully deserve. 

Solving the Puzzle: Embracing Credit Management Automation for Your Credit Team 

Your diligent credit team isn't the source of the problem, but what exactly is causing the challenges they face? 

Regrettably, many organizations neglect regular reviews of their credit policy, resulting in outdated processes and standards that fail to align with the business's needs. The absence of standardized and transparent procedures executed swiftly and in accordance with the credit policy makes the life of a credit analyst exceedingly difficult. Manual approaches and cumbersome approval routes further complicate matters, leading to fragmentation and delays. This oversight comes at a significant cost, as failure to optimize the credit lifecycle in a timely manner adversely affects the entire order-to-cash process. 

Managing accounts receivables becomes increasingly complex when there is insufficient credit availability, leading to blocked deliveries or services. Without a swift mechanism to reassess credit limits, collection clerks face additional burdens in their quest for faster payments and credit release. This diverts their time and attention away from other at-risk customers, ultimately hindering customer satisfaction and cash flow contribution. 

Imagine if your credit team could swiftly analyze data and provide transparent insights based on real-time information. This would allow for easier adaptation of credit limit change requests and credit applications, mitigating the negative impacts on the order-to-cash lifecycle. Productivity would improve, creating greater value and meeting the transparency demands of stakeholders. While your credit team certainly deserves recognition for their tireless efforts in protecting your business and supporting revenue growth, it's time to offer them something even more valuable: credit and risk management automation. 

By embracing credit management automation, your credit team can overcome the challenges they face. Automation streamlines processes, enhances efficiency, and enables quick adaptations to credit-related decisions. It empowers your team to deliver accurate assessments, make informed credit limit adjustments, and facilitate smoother credit applications. This transformation not only acknowledges their contributions but also equips them with the tools they need to excel in their roles. 

It's time to solve the puzzle and unlock the potential of your credit team through the adoption of credit management automation. 

Empowering Order to Cash Success: Harnessing Credit Management Automation 

The credit team serves as the crucial gateway to achieving successful Order to Cash management. It's clear that a robust and efficient credit and risk management approach is vital for the smooth operation of the Order to Cash lifecycle. Therefore, it's worth dedicating time to update your credit policy, review your company's Order to Cash processes, and explore the benefits of investing in a credit automation and optimization solution. By doing so, you not only support the credit team but also satisfy the needs of all stakeholders involved. The power of credit management automation can unlock new levels of efficiency and effectiveness, leading to enhanced Order to Cash performance and overall organizational success. 

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Explore the benefits of Credit Management automation and transform your entire O2C cycle now!