E-Business collaboration tools: changing the face of modern finance. (Selected Topic).
As economic turbulence continues and CFOs are faced with the pressures of managing cash cycles to new performance standards, companies are looking to smooth the financial supply chain. The role of credit and collections departments has now become extremely strategic and closely scrutinized to raise the level of efficiency. The need for proper and timely collaboration for credit and collections departments with customers, internal departments and external partners is demanding new levels of transformation.
Collaboration: What Does it Mean in the Current E-Business World?
As we look into moving to the new generation of digital age processes, it is important to note that collaboration is the fundamental element. Collaboration, in its traditional sense, is collective interaction between multiple parties. So, what is the meaning or definition of collaboration in e-business?
Collaboration, in e-business terms, connects all the parties involved in the process, enables information sharing and facilitates structured and controlled interactions through proper channels--connectivity, electronic information and workflow.
Connectivity provides the core network for interaction. E-mail systems and Intranets have proliferated over the last several years as common collaboration tools for employees; for credit and collections departments, connectivity with customers, internal departments and trading partners, and can be enabled by modern web-based systems. These systems also leverage existing e-mail systems, intranets and extranets. These systems not only eliminate regional, inter-departmental and intra-enterprise barriers, but they also bring together a network of people around specific processes, such as financial supply chain.
Electronic information is the lifeblood of collaboration. Once connectivity is established with the people involved, the next major aspect is sharing information. Modern e-business systems capture information in electronic formats that make it very convenient to share. In most companies, this information is resident in several paper documents and forms, in people's heads, and in voicemails and e-mails. The most important information for credit and collections are invoices, debit memos, credit memos, payments, receipts, PODs, packing slips, sales orders, purchase orders, contracts, collections logs, deduction forms, dispute logs and write-off approvals. With modem collaboration tools, such information can be captured into electronic documents in HTML, XML, PDF and other formats which can be shared very easily across e-mails, intranets and extranets as well as through e-business tools for credit departments. Electronic invoice presentment and customer financials service are huge initiatives in companies that ar e moving to leverage electronic information.
Looking at workflow can add intelligence to collaboration. This controls how and what information is shared and with whom and when the information is shared. E-business collaboration tools enable credit departments to set and control workflows--for example, if a dispute is filed for Customer A and the dispute reason code is "invoice pricing discrepancy," this information needs to be shared between the deduction analyst, the appropriate salesperson, sales manager and the credit manager in the right sequence. The knowledge carried traditionally in the heads of credit department staff on how to drive a task from open to close can now be embedded into c-business systems that can multiply the speed and efficiency of the credit and collections staff.
Thus, the three core elements--connectivity, electronic information and workflow-make e-business collaboration a very powerful way of bringing groups of people together to interact and communicate efficiently and accurately in a fast, complex and changing business environment.
New Business Advantages
The businesses advantages of collaboration in credit departments are very straightforward. Collaboration can help your bottom line by bringing together all the parties involved in the financial supply chain and enabling elimination of cash flow bottlenecks. Here are a few examples:
* By bringing your customer on an e-mail network or extranet, you can instantly post electronic invoices and notify customers electronically the same day you generate invoices. This collaboration with your customer can significantly reduce the time taken for invoice mailing and gather customer acknowledgement.
* By collaborating with your logistics providers for POD, you can instantly identify and eliminate any discrepancy around quantity delivered and time of delivery.
* By collaborating with sales and customer service, you can instantly share information about customer payment issues, open balances and deduction issues, then resolve them in a very efficient manner.
Such advantages tremendously increase the efficiencies of credit and collections departments and cannot be overlooked. These are also prime examples of how technology often is best used. With such collaboration technologies, credit and collections staff can free themselves from administrative activities to focus more on strategic issues of managing the customer financials.
New technology doesn't necessarily have to replace humans. At its best, technology can help people make the most of their talents.
Veena Gundavelli is President and CEO of Emagia Corporation. Emagia can be reached at 866/EMAGIA-1 or visit www.emagia.com.
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|Article Type:||Brief Article|
|Date:||Jun 1, 2002|
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