Accounts Receivable Management, like many other lean industries, has had a long-standing need to minimize headcount and other overhead expenses, while also delivering performance and high levels of service for customers. How have we done it? Like so many others, we partner with vendors, such as collection agencies, to get the job done. But changes in the way companies oversee and partner with vendors has become more costly and complex.
Scorecards have been a versatile tool to help decision makers oversee collection agency performance in both absolute and comparative terms. For a tool in such widespread use, however, there is surprisingly little uniformity or standardization. This is not a "dig" so much as a rallying cry for something we all need.
As scorecards stand today, are they doing the job(s) we need them to do? Or instead, have they become yet another data stream that goes into the wind without informing any meaningful business decisions? To be sure, scorecards shouldn’t just be something we complete each month or quarter simply out of habit, to be able to check a box. They should be designed and weighted in such a way that they drive improved performance and accurately influence business decisions about the client-vendor partnership.
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