You Need a Human Touch

AI is here, and it is here to stay. The capabilities it is going to bring to the accounts receivable world are already amazing, and things are just getting started.

I can still remember the first big automation tool I ever had. It was a brand new company called Bectran, and they would allow us to stop sending out paper applications to our new customers. They would send notifications once an application was submitted, and would send request to trade references on a daily basis automatically. On top of all of this, they would hook up with our credit reporting agency of choice, and spit out a custom rating based on those references, the credit report, as well as their own algorithmic factors.

This was truly a monumental step forward for myself and my company at the time. This conservatively saved me an hour a day, allowed for a significantly faster turnaround time on setting up new customers in our system, and allowed my team to focus on more pressing task.

I am proud to say I was one of Bectran’s first customers, and taking this step into the world of automation showed me how powerful these tools could be.

However, knowing how powerful this automation tool was, and knowing how much my teams and I could benefit from additional automation, that doesn’t mean the human factor can be removed.

In the accounts receivable world, there are a number of tedious and time consuming task. Just think about new customer set-ups along. You have to manually send out an application to the customer, follow-up with the customer if they don’t send the application back to you, review credit application, request additional information or documentation if they didn’t send it over with the completed application, pulling credit reports, reaching out to trade references, following-up with trade references, reviewing credit information to determine credit terms and credit limit, and finally manually setting up new account profiles in your ERP system.

That is a lot of moving parts in just one small aspect of this world. Add that to billing and invoicing, payment processing, collections, and any other area that your consider accounts receivable. It is easy to see why new companies are popping up all the time with new tools to help automate your A/R management. People don’t like doing tedious task, and people don’t like making collection calls to ask for money. It isn’t for the faint of heart.

You cannot just put it all on autopilot, and think it will just run properly without any issues. There are three areas of your business that are extremely customer facing, and require a human touch. Sales, customer service, and accounts receivable.

You have to have a human touch here, and you have to have a human that doesn’t just look at the numbers and data. While there are plenty of things to automate to make lives easier and improve efficiency, you need the human touch to add the right emotion to these situations.

Sometimes the automated credit scoring doesn’t take all factors into consideration when looking at the credit worthiness of a customer.
Sometimes the automated payment processing doesn’t understand why a customer is paying certain amounts towards certain invoices.
Sometimes the automated collections process doesn’t know when to press harder and when to pull back.

What does this mean?

It does not mean the end to A/R departments and teams. It can’t be. As much as automation and AI tools will change the landscape of all areas of accounts receivable, and business in general, this line of work will always require a human touch.

There is an art and a science to the world of credit, collections, and accounts receivable. The science part is the easy part. It allows you to look at the data and make decisions. It allows you to utilize tools and automation to make things move faster, minimize human errors, and become a more efficient and effective department. It has to be used in the proper context though, and that means not everything can be automated. It means freeing up time and energy from the mundane task, so the art of the human touch can be put into place on the task that are not just high level, but also require the emotion only a human can give. It means looking at things from a human perspective. Knowing when to take a risk, and when something just feels off. When to skip the normal steps in the process or make exceptions to the rules.

The benefits of this are, your team will be able to focus on more high level task, and will become very good and very efficient. Businesses will try to take advantage of this by having a more lean and mean A/R team. The downside there is you are going to minimize the amount of entry level positions in the accounts receivable world, requiring more training and patience for new hires. Companies that are not automated in this world are going to constantly have their employees pouched because someone else gave those people the entry level position that doesn’t exist everywhere.

AI and automation are the future, but it isn’t the end.