Is Technology a Help or Hindrance to Credit Control?

27th April 2018.

These days you can barely get through the day without a belittled employees complaining how automation “stole” their job.

Our business world has already been transformed by the adoption of technology:

Self-service tills have replaced cashiers.
Ticket machines in train stations and cinemas have replaced face-to-face ticket offices.
Some supermarkets even have computers to direct customers to the correct aisle.

Whether we like it or not, the digital age has arrived, and it has left traditional concepts in the dust.

New ideas and methods are on the horizon and people are resisting. But is this really such a bad thing?

Being an employee can be hard work, and introducing certain automated components could just make the work day go that bit quicker.

This is particularly relevant to credit management, where a lot of menial and mundane tasks are involved, such as filing, taking payment, and maintaining frequent communication with the client. These are all necessary if a positive result is to be reached, but do not demand a human touch.

However, the popularity of automation has brought up issues of privacy, data protection and the necessities of human interaction.

So the question remains, do we resist the robot takeover, or do we insist upon it?

Payment methods

The concept of paying your customer by check is now something of the past. Instead, the majority of credit controllers will insist upon direct debits, or even standing orders to facilitate monthly payments.

This not only makes the whole process quicker and more efficient, it also reduces the risk of human error or at least the risk of losing the cheque in the post.

At the Credit Protection Association, many of our members have relayed anecdotes where a “lost in the post” claim has severely delayed the process and strained relations between all involved.

Email

Whether it’s sending invoices, resolving disputes, or merely keeping communications open with the supplier, email can make the process simpler.

Sending documents by Royal Mail runs the risk of a late delivery, while telephone calls can risk misinterpretation. In contrast, an email is a quick, efficient and accurate form of communication. It is also a clear way of keeping up a rapport with the client, without pressuring them with letters and persistent phone calls.

Invoices

Similarly to cheques, paper invoices are falling in popularity as more business owners send their invoices through an email attachment.

Paper invoices have afforded customers with an excuse to delay payment, with blame laid heavily on Royal Mail or the original sender for a failed delivery.

Some credit controllers now utilise automated invoices, where a number will be sent to the clients automatically. This prevents tardy behaviour on the part of the credit controller and should encourage the client to pay promptly.

The most efficient method is to conduct both- paper invoices as well as an email version to accompany it. At the Credit Protection Association, we always send our debtors a paper invoice, mainly for their records as well as for ours. We follow this up with an email invoice, so we have covered all our bases.

An extra good measure is a quick follow-up telephone call to ensure the invoice has been received via both mediums and to allow the debtor to voice any issues with the invoice early.

Digital filing

Many credit control organisations still process their documents manually, and print two copies and post one and file the other away for records. Some of these documents, such as invoices, need to be retained for up to seven years to meet compliance standards.

Some more modern companies have embraced a more cost and time-efficient approach. Documents are instead maintained electronically on laptops and iPads, facilitating easy retrieval and meeting stringent audit requirements.

Data protection

Unfortunately, the more doors technology opens, more are available for swindlers to walk through.

Adopting automation in the workplace means more data is put on computers, laptops and iPhones. By transferring documents from paper format to digital is convenient and efficient, but it does inspire new rules and regulations. Consent must be achieved when storing client’s data, and then again when it is moved or destroyed. The process quickly gets more complex.

Not only do new data protection laws dictate rules and restrictions on digital workplaces, but try to prevent fraudsters from taking advantage of any data put out in cyberspace.

Of course, any piece of information is at risk of theft. Paper files can be misplaced or easily destroyed, and are by no means exempt from contamination.

Whether it’s paper or digital, the correct security measures should be adopted. Anything from sophisticated firewall software to a locked storage room can make all the difference.

In conclusion..

There’s little argument that technology makes the working day a little easier and more efficient, but it is not without its drawbacks.

Filing clients’ data digitally brings new complexities. Data protection laws tighten around digital workplaces, creating a multitude of hoops to jump through.

However, if the competition is boasting a confident online presence, shirking away could damage our reputation and threaten Britain’s place in the digital race. Maintaining an eye-catching and informative website and social media channels are simple ways of gauging interest in a brand and could see sales increase as a result.

Yes, the newest technology or software does attract the more sophisticated fraudsters. However, debt recovery companies like CPA could free up the necessary cash flow to purchase the best firewalls and security systems to discourage even the most dedicated swindler.

If UK businesses are to compete with rival economies, risks will need to be taken. We have no hope of succeeding in the post-Brexit landscape if our businesses rely on manual processes or the security of a locked storage room.

Our debt recovery services will free up the cash needed to embrace the digital age, as well as the most sophisticated firewalls. Contact CPA with the details below!