The invoice-to-cash process is essentially the journey from generating an invoice to collecting payment for that invoice. A process that has historically been paper and protocol heavy and hence immensely slow. This involves three key aspects:
1. Billing clients
2. Collecting dues
3. Tracking and managing payments
Each aspect comes with its own process and challenges and thus far circumnavigating the pitfalls has been a major effort, especially for small business that try and everything with a lean team. The time between invoicing and client payment becomes critical to profitability in business that run on more traditional models, where clients are billed for time rather than just final output. This is especially true for law firms, where managing financial health is a constant challenge and optimization is key to keeping a steady cash flow. This is where a keen focus on the invoice-to-cash process becomes extremely important.
The first step in the Invoice to cash process is understanding how billing works. A few of the common billing modules are - Hourly rates, Flat fees, Contingency fees, Retainer fee. Once a pricing model has been decided, a billing module can be chosen. But that’s the easy part. This is followed by some common challenges faced by law firms or other similar business of all shapes and sizes.
The typical challenges include having complicated billing guidelines to follow. With each new client comes a new set of guidelines, new requirements and formats. It is quite easy to mix up who wants what or miss out on crucial details.
1. Varied billing frequencies. Depending on the billing module and client, the billing frequencies can change, making it a challenge to constantly, manually monitor billing.
2. No standard submission process. Different clients work in different ways, some want the bills so sync directly in their financial software while some are still in the paper era
3. These are just a few of the most common challenges a small law firm or business can deal with on the billing front, and for new business it is imperative to keep a focus on managing a steady cash flow.
The next piece of the puzzle that impact the cash flow is the collections process. Firms that do not use any automation end up spending a significant part of their time recording time and collection activities. If payments are delayed, consistent follow-ups have to be done to make sure that the dues are cleared.Every business needs to be careful with the methodology deployed to follow up to not offend clients by creating pressuring. Another issue in this space is the lack of transparency and tracking. If bills aren’t tracked accurately, the reminders can be inconsistent, making the entire process overwhelming if not irritating for all parties involved. With the deployment of the right kind of technology, firms can ensure sending out accurate invoices, timely reminders, follow-ups, traceability, reconciliations, and detailed reporting.
Typical current billing systems are outdated, require manpower, and are often riddled with mistakes regarding the balancing of books. Once invoices are generated, be it through PDFs or LEDES, they are invisible to the firm, and in case of no payments, firms are expected to wait for 60–90 days before escalating the matter. Even when using eBilling software, there’s no trend mapping or learnings from previously submitted invoices and any reductions/rejections whatsoever.
This is where Oddr comes in. At Oddr, our mission is to change the way in which invoicing, collections, and accounting are done across the professional services industry. We deploy intuitive and intelligent technology to ensure that the process of collection is done hassle and error free. Our process bridges technology with client service, making sure that the entire exercise does not take away from a stellar business experience. If you run, manage, or are in the process of setting up a law firm, Oddr needs to be an essential part of your tech stack.
We use AI, Automation, and Data Intelligence to enable firms to manage the entire Invoice to Cash process efficiently through a single platform. With Oddr you can set up intelligent financial dashboards that allow you to measure specific KPIs, set goals, and track performance across the KPIs. From error reduction, improved traceability to increased collaboration across the bill generation and submission processes, you can manage and monitor it all! You can also use our predictive analysis to create cash flow models and be prepared for the next big leap for your business.
In the last few years, accelerated by the pandemic, the entire business and billing landscape has changed. With Oddr, you can now be totally in charge of your company’s financial process, streamline all action, get paid faster, get paid more and all of this with happier clients that have a great experience!
Oddr has been built and is run by an experienced and passionate team of experts in technical innovation, product management, legal technology, and business strategy. With a collective experience of over 45 years, they know how to get the work done, in the smartest way possible. Streamline your billing process, reduce inefficiencies and minimize losses, check out our use case video to find out how.
Our team of experts will help you along every step of your invoice to cash process and ensure your business lowers bottom-line costs and improves customer satisfaction.