The theme of working capital improvement is now one of the primary concerns of businesses across the globe. It is a concern as we face economic slowdowns, supply chain disruptions, ongoing geopolitical conflicts, rising interest rates, and so forth. How will this affect financial operations?
This is an especially critical issue as one moves down the scale of business sizes. This is where access to reasonable credit costs becomes more of a struggle. This article posted in Smartstream discusses one of the key types of solutions within financial operations. It can help to manage the cash cycle for businesses. The piece is written by a chief revenue officer of a fintech that provides solutions for improved payables and receivables. In this case it refers to electronic invoice payment and presentment (EIPP). EIPP has been around for a couple of decades but gained renewed focus during the pandemic.
Electronic Invoices
We have written about the criticality of electronic invoices in member research. Electronic invoices are often a key step to improving both collections and payables processes. It provides the immediate impact of increasing matches between, purchase orders, invoices and payments. The convergence of the cash cycle operations is part of an end-to-end organizational review that allows for more optimal enterprise efficiency.
Cloud Delivery
As we have also stated in other research, the use of cloud delivery (SaaS and PaaS models) has contributed to the acceleration of more modern technology, which can be launched and updated more easily than in the old installed models. Connectivity has also improved through the use of APIs to integrate between internal and external systems and partners.
Mobile Devices for Financial Operations
The author goes on to discuss the next phase of the B2B payments evolution to modern times, spurred on by B2C payments and usage of mobile devices. Although B2B is more complex than typical consumer payments, the technology exists to make the experience flow through mobile devices more easily with the proper review and approval workflow. This is part of the benefit of digitization, which allows for greater use of artificial intelligence (AI) to automatically increase accuracy and speed. Worth a quick read for those in the discovery phase.
Overview by Steve Murphy, Director, Commercial and Enterprise Payments Advisory Service at Mercator Advisory Group.