Threat or a Gift? What Automation Really Means for the Customer-to-Cash Process

October 17, 2018

The customer-to-cash process encompasses the financial and business processes for receiving and processing customer orders.


A company that has an efficient customer-to-cash process in place will always bill its customers in a timely and error-free manner, obtain payment for products and services to agreed payment terms, and aim to process payments in the most accurate and automated manner.

However, many large organizations still struggle to find the right balance between processing customer orders efficiently, minimizing bad debt losses and enabling profitable sales.

Similarly, our REL Working Capital Survey ( shows that 2017 saw a robust performance in cash conversion overall. In Europe, days sales outstanding (DSO) improved by 5.2% or 2.6 days. Its success suggests that much more can be done to reduce the mountain of €1.1 trillion currently tied up in excess working capital. Last year, this amounted to 7.3% of FY2017 European GDP of €15.3 trillion. Of that, the receivables opportunity represented 353 billion lost euros. However, the accounts receivables performance was markedly different than in the US where among the top 1000 companies DSO deteriorated by 4%.

Consequently, most finance professionals continue to identify several pain points in processing Account Receivables, such as:

  • Inefficient paper posting process
  • Re-keying of data
  • Manual processes that create posting errors
  • Challenges in automating the ERP process for multiple receivable channels
  • No remittance information received with the payment
  • Late payments and unauthorized discounts
  • Customer demand for additional payment channels resulting in dissatisfaction and attrition

Not being able to bridge these challenges, may have a serious impact on your working capital levels and consequently on your cash inflow. To minimize the impact, many tech companies offer services that can automate Customer-to-Cash processes and create a competitive advantage by speeding up business and empowering the financial team’s decision-making. Along with simplifying the process of manually handling tasks or data into an automated accounting system, many software packages include cognitive features.

Examples of automated Customer-to-Cash sub-processes include:

1.    Automated Billing

Automated billing systems provide the ability to generate and send electronic copies of the invoices to customers. In most cases, the software is designed to allow the creation of customer profiles which contain all the data needed to accurately prepare the invoice, thus eliminating the need for one or more employees to spend hours on this repetitive task. The use of this type of billing software makes it possible to manage the invoicing process with greater efficiency, saving the company both time and money.

2.    Automated Collection

The main reason for automating the collection process is financial, including improved debt collector productivity and enhanced customer service. The time spent by debt collectors on clerical tasks is the main cause of low efficiency and productivity levels. Manual tasks executed routinely by collectors include: reviewing aging reports to identify customers who need to be contacted, prioritizing customer contacts, researching and collecting documentation prior to making a contact etc.

One of the most important benefits of automation programs is the availability of data and information within the system. Collection automation eliminates many of these clerical tasks or at a minimum simplifies the tasks, enabling the collector to focus more energy on phone calls and follow-up activities with the customer.

3.    Automated Cash Application

Automation of the cash application process covers remittance aggregation from different sources/formats, payment linking, invoice matching, deduction coding, and ERP posting. By using this feature, organizations can reduce errors and costs as well as enable employees to better focus on high priority tasks by pushing routine and monotonous tasks to software “robots”.

Thus, automating the Customer-to-Cash process can increase processing and payment accuracy, enhance efficiency and cash flow, while improving customer service at the same time.