Client Connection

Client Connection

Tuesday, August 16, 2016

A/R Management Software: Using It for What It Should Do, Not What You Hope It Will Do

A/R management software is not the solution to a law firm's collection problems nor is it a substitute for the consistent personal contacts, techniques and strategies needed to get bills paid. There is no getting around the fact that collections is "roll up your sleeves" work.
The right management software can support and complement your firm's efforts to collect A/R. But make no mistake: software alone is not the answer. Many firms have believed, mistakenly, that by installing collection software, their receivables problems are over. In many situations, the use of software just hides the truth: that firms are searching for the answers to how they can better collect their receivables without first honestly evaluating what they are doing wrong.
They lose sight of the fact that the software is simply a tool, though it is potentially a powerful one when used correctly.  More important is the strategy the firm adopts in using the software and the people who are using it.
What software should do is track day-to-day collection efforts -- what tasks need to be completed each day -- and provide firm leadership with real, actionable information to show that collection activity is moving forward and progress is being made on each account. The detailed reports from the software should provide information on whether accounts are actively being pursued, what the payment status is, who is pursuing collections and what success they are having, why clients are not paying, and what steps are being taken to get them to pay. And, for firms that have a large number of client matters, it helps track the higher balances that require action.
No matter what tools or infrastructure you have in place, collections will not succeed unless your firm understands the stories behind the numbers -- the reasons that clients are not paying. Information can be a powerful tool -- but it's the people and their know-how that will get accounts paid.

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