The revenue management automation is king under current market conditions. Utilities transition to multi-utilities, expand product and service spectrum, have partners to share revenue with, and other complex factors.
Businesses are using the automated revenue management system to handle multiple income flows, diversify their portfolios, and remain supportive and helpful to clients. This system is all about price management and marketing.
In the meantime, should they add automation to end-to-end billing along with price setting, this combination pays off significantly. It helps streamline workflows and reduce employee workload. This way, teams can focus on improving their performance and productivity.
Despite the numerous benefits of automating financial processes, coming from revenue management automation software, many companies remain hesitant to adopt automation. As a result, essential operations are still being done manually, which is usually time-consuming, error-prone, and dependent on human focus. According to a recent report, only 38% of companies automate their financial and billing procedures. This might be due to a lack of understanding of the advantages of modernising financial and revenue operations.
As the world tracks fast into the digital age, it is time for businesses to start thinking about automating their billing operations for a number of reasons. Let’s revisit the major ones and learn about the benefits of automated revenue management software.
What is an Automated Revenue Management System?
The science behind revenue management is quite simple. In the domains of utility, iGaming, telecom, and other industries MaxBill serves, such an approach suggests selling the appropriate services to the right clients at the right time, and at the right price – all of that in the most efficient way.
Chron provides an excellent definition, and we cannot agree more:
“Revenue management is the practice of maximizing a company’s revenues while selling the same amount of products or services. Also called yield management, some consider it both an art and a science.”
An automated revenue management system (ARMS) is software that assists financial managers in running revenue tasks more effectively and optimising the costs associated with income operations. ARMS takes a variety of factors into account, including historical data, rates, seasonality, etc. to optimize rates and maximise revenue. By using ARMS, industries can increase profitability, improve decision-making, and better manage their inventory.
Why Successful Utility CIOs Use Automation in Revenue Management
CIOs in energy and utilities need automation in revenue management for several compelling reasons:
- Efficiency and Cost Reduction: Automation helps in streamlining back-office and operational processes, which are often labor-intensive and repetitive. By implementing technologies like Robotic Process Automation (RPA), energy and utility companies can reduce operational and maintenance (O&M) expenses significantly. This leads to increased worker capacity by 15%-25%, allowing employees to focus on higher-value tasks.
- Improved Customer and Employee Experience: Automation in revenue management enhances the efficiency and satisfaction of both customers and employees. Automated processes can manage tasks such as billing, collections, and customer service more effectively, reducing the cycle time and improving service quality. This results in a more satisfying experience for customers and a more engaging work environment for employees.
- Regulatory and Compliance Benefits: Automated systems can help manage regulatory reporting, compliance, and risk monitoring more efficiently. This ensures that energy and utility companies stay compliant with industry regulations and can swiftly respond to changes in policies, such as those aimed at reducing carbon emissions.
- Data-Driven Insights and Optimization: Tools like process mining and data visualization enable CIOs to identify inefficiencies and optimize processes. This structured approach to process excellence helps in uncovering execution gaps, monitoring cash flow, and improving the overall operational efficiency. The insights gained from data-driven approaches can guide the implementation of effective automation strategies.
- Scalability and Future-Proofing: Revenue management automation allows for scalable solutions that can adapt to future challenges and opportunities. As the energy sector evolves, with increasing emphasis on sustainable practices and new service offerings, automated systems provide the flexibility needed to innovate and stay competitive.
- Cultural and Organizational Transformation: Automation fosters a cultural shift towards embracing technology and innovation. By involving multidisciplinary teams and securing buy-in from various stakeholders, CIOs can lead the organization through a transformative journey, ensuring that employees see the benefits of automation in their daily work.
Benefits of Revenue Management Automation:
1. Reduction of Invoice Processing Time
Implementing automation in financial processes can significantly reduce the time it takes to process invoices. To be specific, it cuts down 10% to 40% of your processing time. The system completes all necessary tasks, such as data entry, number confirmation, and obtaining required approvals, without the need for further human intervention.
It frees up employees’ time and energy to focus on raising productivity and handling complex tasks, allowing them to be more creative and productive.
Revenue management automation also paves the way for a more streamlined routine. It prevents your operations from getting stuck and ensures that the billing process flows smoothly.
Not to mention, it prevents you from missing deadlines and due dates since it automatically processes the billing. Additionally, automation helps speed up cash flow by shortening the time between when billing starts and when invoices are sent out.
2. Billing & Invoicing Accuracy
Accounting errors can have a significant impact on your business. It might even result in losing money in the process. Meanwhile, backtracking and resolving such mistakes means taking precious time away from employees who need to focus on other essential tasks. Furthermore, resolving errors manually does not guarantee that the same errors will not occur again.
So, one of the meaningful benefits of revenue management automation software is that it can reduce the likelihood of billing mistakes. It helps to avoid errors that are usually common when tasks are completed manually, like miscommunication, miscalculation, misfiling, and typos when entering data. By automating your billing operations, you can minimise the risk of duplicate payments, overpayments, and underpayments.
3. Billing Process Transparency
Any discrepancy in the invoices might lead to severe consequences for the company. Keeping track of the cash flow is critical for the high efficiency of any business.
Revenue management automation helps keep an eye on every billing process within your organisation. It provides real-time monitoring, live updates, and report generation to keep you aware of the current status of your payment cycles.
According to FinancesOnline’s guide on billing and invoicing software analysis, implementing the appropriate software can give you greater control over your finances in no time. Additionally, it can help prevent unauthorised access to financial information and reduce the risk of data breaches in the future.
4. Revenue Performance Driven By Operational Efficiency
When it comes to operational efficiency in the financial area, the revenue automation system is king. When it comes to processing invoices, bottlenecks are often inevitable. Specific approvals must be obtained before money can be transferred between bank accounts. Having to follow up manually back and forth between the client, bank, and supplier can eventually be exhausting and inefficient. This puts other tasks on hold in the process.
Using an automated revenue management system helps you get rid of these bottlenecks. With just a few clicks, you can start billing your customers, validating checks, previewing invoices, and maintaining recurring charges. And since everything is automated, you can go on with other value-adding tasks in between while also taking your customer communication to the next level.
5. Digital Transformation
Automating billing operations also means digitization across the entire company. It eliminates the need for paper trails and file cabinets since all documents and files will be accessible in a digital storage system.
There are several benefits to going digital. It facilitates better collaboration since anyone with access can retrieve and send necessary files and data to the rest of the organization. Likewise, digital files mean you don’t have to worry about misplacing or losing important documents. Not to mention, it is much easier to organize, categorize, and archive them when needed.
How Automated Revenue Management System Complete End-to-End Billing by MaxBill?
ARMS makes a good team with end-to-end billing. Once companies establish prices and proceed to charging for services, it’s crucial to evaluate the quality of billing. In this regard, MaxBill helps by delivering a meaningful metric, Days Sales Outstanding.
DSO is an accounting metric that gauges how long it typically takes a company to get paid for products and services bought on credit.
The lower the DSO, the faster payments are collected, while a higher DSO indicates a longer period before the company receives its money. By tracking DSO, companies can improve their cash flow and optimize their revenue management processes.
Here are other areas where companies get solutions for:
Accounts Receivable
With the help of a tailored payment plan and automated payments from the defined bank account, businesses allow customers and partners greater leeway in how and when they pay their bills. Businesses are enabled to maintain the receivable side of customer accounts.
Accrual Reporting and Forecast
Thanks to an automated revenue management system, it becomes simple to track unbilled revenue earned for the entire client base or simply a certain segment.
Collection Activities
Managers oversee unpaid invoices, including late fees and past-due uncollectible receivables, and they set up operations to collect the arrears in accordance with the organization’s standards. The automated revenue collection system will save the day if the company faces significant indebtedness from consumers.
Manage Payment Arrangement
The team can quickly design, collect, and track time-defined payment arrangements with the right software, taking care of customers’ demands throughout the journey and generating additional income.
Take Full Control with the Automated Revenue Management System
Automating your billing operations can help you take greater control of your revenue performance by optimizing your processes, streamlining communications, and increasing productivity. It’s more than just letting the software do all the work; it means reducing the chances of missed or duplicate payments, errors, and delays during billing. With automation, you can focus on your core business activities while ensuring that your billing operations run smoothly, efficiently, and with improved accuracy.
Billing and Revenue Management Automation is a wonderful opportunity-creating tool for smaller businesses and larger enterprises alike. Do you want to discover the benefits of this powerful combo – automated revenue management and end-to-end billing software – for your business? Reach out to our pros to get more information.
