Advanced SAP Collections

Management - Best Practices

CRF SAP User Group

Presented By:
Sashi Narahari
August 15, 2011

Copyright 2011, HighRadius Corporation. All rights reserved.

Agenda

FSCM Overview
Collection Management Overview
Collections Best Practices

FSCM Modules At-A-Glance

Receivables
Manageme
nt

SAP FSCM Collections Management

Overview

SAP Collections Management

Overview

Collection Supervisor

Define collection
strategies / rules
Define work item
assignment to users /
groups
Monitor and reallocation
of workload
6

Collection Specialist

Incoming / Outbound
collection calls
Process daily worklist
based on prioritization
Record customer contact
and follow up

Collections Management: Collection

Specialist

Collections Management: Collectors Worklist

Text

Double-Click to
open customer
work item

Collections Management: Invoice Summary

Text
Default
Customer
Contact readily
available

Review open
items to be
collected

Collections Management: Payment History

Text

Review payment
history

10

Collections Management: Dispute Cases

Review open
and closed
dispute cases

11

Text

Collections Management: Promise-to-Pay

Text

Record promise
for payment or
customer contact
at the invoice
level

12

Collections Management: Promise-to-Pay

Promise for
payment has been
recorded

13

Text

Collections Management: Customer Contact

Text

Record customer
contact resulting
in completion of
the work item

14

Collections Management: Completed Item

Work item
completed

15

Text

Collections Management: Resubmission

Create a
Follow-up
reminder on
specific
invoices

Collections Management: Resubmission

Summary of
all Follow-Ups

Collections Management: Notes

Select invoice
and enter
invoice
specific notes

Collections Management: Notes

Summary of
all Notes

Collections Management: Correspondence

Several
Corresponden
ce Options
available

Collections Management: Correspondence

Email contact
notes and log
directly from
SAP to
customer

Collections Management: Correspondence

Select the
specific type
of
corresponden
ce or letter to
send

Select a set of
invoices

Collections Management: Collection Manager

23

Data available for Collection Strategies

24

Collections Strategy Definition

25

Collections Management: Collection Strategy

Text

Collection Rules
within the
Collection
Strategy

26

Collections Management: Collection Strategy

Text

Conditions
within a
Collection Rule

27

Collections Management: Collection Strategy

Text
Automatic
Prioritization of
Customer Work
Items

28

Collections Management: Collection Strategy

Text

Priority is
determined by the
valuation of each
collection rule
29

Collections Best Practices

30

Collections Best Practices

Customer Segmentation
Automated Correspondence
Invoice-Level Collections
Collect on Clean Receivables
Blocked Order Based Collections

31

Customer Segmentation

By Size
Large Accounts
Small & Medium Businesses (SMB)

By Payment Behavior (Days Beyond

Terms)
Fast Pay, Medium Pay, Slow Pay

By Risk Category
High, Medium, Low

Sales Volume
High, Medium, Low
32

Automated Correspondence
for SMB

Gentle Reminders, Past-Due Notices,

Demand Letters (Standard SAP A/R
Dunning)
For most SMB Customers
Except for Fast Pay or High Sales
Volume

Include Invoice Copies, POD Copies

for 2nd and/or 3rd level Dunning
(Requires Enhancements to FSCM)
33

Slow or Med Pay SMB

Collection Strategy

34

Advanced Correspondence

35

Advanced Correspondence Automation

Selection criteria:
type of letter,
attachments and
method of
communication

36

Advanced Correspondence Automation

Highlight AR
line items to be
included in
correspondence

37

Advanced Correspondence Automation

Cover Letter

38

Advanced Correspondence Automation

Invoice
Attachments

39

Advanced Correspondence Automation

POD Attachment
#1

40

Advanced Correspondence Automation

PODs attached
to the Invoice
AR line item

41

Invoice-Level Collections

Dunning might not work for Large Customers

Most large business have automated AP
systems and are not paying because there is
a issue with the invoice
Invoice-Level Collections similar to Disputes
First perform root cause analysis based on
history what the reasons for issues are
EDI Transmissions, Disputes (Pricing Errors,
Shortages etc)

Create Dispute Case for problem invoices

42

Create Disputes for Invoices

43

Clean Receivables
To Be Collected Amount Calculation

44

Total Amount Past Due Total of all overdue items in FI-Accounts

Receivable
Items with Open Promise to Pay If there items with an open promise
to pay, or items with a future payment promised on date, these items will
be excluded from the To Be Collected amount
Dispute Cases not in a To Be Collected Status All open dispute
cases, which have not been updated with a status that is mapped to the
To Be Collected in collections management, will be excluded from the To
Be Collected amount
Items with a Current Dunning Notice If a line item in FI-Accounts
Receivable has recently been dunned, this amount will be excluded from
the To Be Collected amount.
Items Arranged for Payment All amounts that are (a) collected with a
debit memo procedure or (b) where the account statement balance
contains a payment notification from the bank will be excluded from the
To Be Collected amount

Use Collectable Amount in

Strategies

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