4 ways to monitor the performance of your AR process

I recently shared a process for proactively managing accounts receivable (A/R), but it’s important to remember that the process is not a self-licking ice cream cone; it has an objective: reducing your total overdue receivables.

Success with metrics comes through understanding what outcomes you really want.

Once you know that, you can discover the metrics and set the goals that will get you there, instead of just measuring whatever you can. The former enables delegation, efficiency and scale. The latter leads to inefficient management and annoyed staff.

For example, one telecommunications company I worked with had a goal of no excess capacity — in other words, no capacity that wasn’t serving a customer.

The problem was that if they actually achieved that goal, customers would have waited two months or more to get their broadband Internet. Would you have waited two months after placing your order? Exactly.

Don’t set goals that will shut down your business.


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