Wednesday, September 20, 2023
11:00 AM – 12:00 PM EDT
This is an online event
Anthony Mignogna, Corcentric
Craig Jeffery, Strategic Treasurer
This webinar discusses the survey results from the 2023 Modernizing Accounts Receivable Processing Survey. The survey explored the practices and plans of AR professionals, pain points, areas of increasing value and investment, and more. From reasons to move providers to challenges in achieving AR process modernization, the results covered in this webinar shed light on the current environment, the rates of change, and the ways your peers are responding to disruption and corporate goals.
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Welcome everyone to today’s webinar on the 2023 Modernizing AR Processing Survey. This is Brian from Strategic Treasurer and we’re pleased you could join us as we discuss the survey results and discuss the implications for organizations and 2023 and beyond. But before I introduce today’s speakers, I have just a few quick announcements. Zoom offers several different ways for us to interact today. If you would like to post comments or questions viewable by all attendees, please use the chat icon in the toolbar. If you’d like to ask your question to just the presenters, please use the q&a icon in the toolbar. You can ask your questions at any time during the presentation, and we’ll try to get to as many as we can. But if we don’t get to your question, someone from our team will gladly follow up with you. There will also be a few polling questions throughout today’s webinar where you will be able to select your response from a list of multiple choices. You will need to click the submit button on the polling questions to have your response recorded. If you are here for CPE credits, you will need to answer at least three polls today. And last, please ensure that your zoom display name includes both your first and last name, so we’ll know to whom we should send the credits. Our speakers for today are Anthony Mignogna, Vice President of Strategic Solutions Engineering at Corcentric, and Craig Jeffery, Founder and Managing Partner of Strategic Treasurer. Welcome Anthony and Craig. And I’ll now turn the presentation over to you.
Craig Jeffery 02:05
Thanks so much, Brian. And, Anthony, it’s good to present with you on this research that we did together. Thanks so much for joining.
Anthony Mignogna 02:12
Yeah, likewise, appreciate it.
Craig Jeffery 02:15
We have a great appreciation for everybody who took the survey. So if you’re here, listening to the results, and you took the survey, you have a double portion of thanks from both of our companies. You know your time spent responding to a survey helps you individually and also gives you more data and detail. So you help the industry and that is greatly appreciated. I am also looking forward to some of the polls that we do on a on a question about survey results on a webinar about survey results. Asking poll questions seems doubly data specific. Let’s go through our agenda, we have a few things we’re going to cover today. And you can see some of the containers shown on the screen. We’ll cover some information about the survey. Over 200 People took the survey ran for about five weeks, had over 50 questions, pretty, pretty significant piece of work. And we’ll go into some of the details about that to start off our discussion. Then we move on to inbound payments. And the you know a lot of the learning here is there’s more payment types that are coming in. There’s increasing complexity in many, many companies. Very few companies have one payment channel one payment type, one bank one account, more and more companies are experiencing high complexity, or hyper complexity and that colors, a lot of discussion. When we think about modernizing accounts receivable, there’s more moving parts. How do we do that. So we’ll look at some of the data and what some of your peers are doing. They’ll move on to visibility, this desire for real time desire for more information, and how this is changing over time. This is this is not just impacting AR, it impacts AP Treasury finance, pretty much our entire lives are focused on more visibility, better visibility, the power of data in a very timely fashion, maybe not instantaneous, but in a timely fashion. Then fraud brings its raises its ugly head again, there are losses, there’s concerns, we’ll touch on a few of those areas. It’s significant, you’ll see some of the numbers and find that interesting and compelling for how we respond and prep ourselves on the on the pain points. There’s a few areas that we’re going to highlight today. There’s obviously more than we’ll be able to get to in today’s webinar, but forecasting continues to grow in importance and then the size of pain that it’s causing. And if you look over a multi year trend for this research, you’ll see how that’s happening but there’s a Couple other areas as well, from staff on collections to reporting and visibility, those things are, are changing in importance to your peers, and probably to you. And then other key takeaways, we’re looking at some, some advice to leave with you as a result of this information from the research as well as from what Anthony, and I and our companies know about the business. So how do we deal with? And how do we think about increasing channel complexity? What needs to be examined most closely, ways to deal with fraud, and then this idea of visibility, and viewpoint. So that’s our list, we’ve got 55 minutes to get through it, maybe 54. I’m really interested in doing that, I’ll cover the results I gave you some heads up. On the quick stats, well, over 200 of you took it across all kinds of domains, you can see annual revenue size, it tends to be a little bit a little bit more heavily biased in the one to 10 billion annual turnover, revenue, pretty even across the way we have the group’s broken out. But certainly quite a bit of information. That’s useful. Extremely heavy participation, North America, Europe, and Asia Pacific strong as well. lighter and lighter in Africa and Middle East, and decent representation in Latin and South America in terms of where companies operate. So that’s the the quick and dirty on the survey results, Brian mentioned that you can download the report, that information will be shared in both the chat box and at the end of the webinar, encourage you to click download it feel free to share the link with others to download that. So onto the complexity. You know, here’s a, here’s a chart that shows how many banks do organizations have to receive payments? I’ll do this as a setup for Anthony. So just to explain it, you can see one across the y axis across the bottom one to 21 Plus or I don’t know. So, you know, Anthony, it’s a it’s a huge percentage that use more than one bank and sometimes even using, you know, more than five or 10 banks. Here, this is a complex environment that more and more organizations are seeing some challenges with.
Anthony Mignogna 07:31
Yeah, I mean, there’s an equivalent number using more than five then as those using one. Right. And it’s it’s a testament to the the, I think one of the common themes that we’re seeing, is this increasing complexity in b2b commerce. You know, because for every receivable, there’s a payable on the other side, right? And, and, you know, ultimately, how do you kind of structure your, your, your billing too, so that when you get those those receipts in, you can route them appropriately to the right accounts, you know, kind of doing it right the first time, right, but then also planning for the inevitable Miss allocation that you might need to shift across across accounts or across banks.
Craig Jeffery 08:22
Yeah, so the the note at the bottom, there, too, is a seven 8% of large companies use more than one bank just as a placeholder for everybody who’s looking at the top of the top chart that where the green bars are, that’s the broad full population. But if we break down companies between large and small, and you can see in the report where the cut off is, it’s an even larger percentage use more than one banks, which is not not particularly surprising. But because we have so many people, there’s there’s good ways of cutting the data.
Anthony Mignogna 08:52
Yeah, and everybody’s trying to grow, right. And as as you grow, complexity is inevitable, right? It’s going to kind of grow with it. And so it’s something that you’ve got to plan for, you know, as as, as you scale.
Craig Jeffery 09:07
Excellent. Thanks, Anthony. And so this next, this next set of data, this next chart, talks about Inbound payment channels, we left off some of the more manual methods that are more common to us and less common in other countries. So we focus more on the electronic or digital methods from the top to the bottom, and you can see that the green of the green is plan to add in the next year, and blue is current use. So some things like real time gross settlements, like wire transfers at the top, a very, very small percentage plan to add almost all use that as a method of receiving payments. And then you go down all the way to zero at the bottom, which historically has more than consumer to consumer but also making its way into the receipt little space from 3%, to another 7%, expected within next year, bringing that to 10. And then I’ll let you dig into this for the group.
Anthony Mignogna 10:13
Well, I mean, I think it kind of ties to the previous slide as far as the complexity, right? You know, how the money’s coming in and where it’s going. You know, I think it’s, it’s worthwhile for organizations to be flexible in the payment methods that they accept, I think it gives you a better chance of getting paid on time by your customers. So, you know, you want to have that flexibility to kind of meet your customers where they are, but also, you know, be able to, to move customers to to your preferred channels, when that’s applicable, you know, understanding that your customers are different points of adoption on some of these as well. Right. So you mentioned, you know, in North America, there’s still lots of organizations that are paying and getting paid by paper checks. You know, ideally, you want to move this electronic from a receivable standpoint, but you know, you got to have that flexibility, so you can ultimately get paid by customers.
Craig Jeffery 11:17
Yeah, it seems like most companies offer, you know, more or all of the above to receive payments, and sometimes that’s restricted in different areas. So, Anthony, I would like to ask you to look at the chat box, there’s a section about downloading the survey report, Brian has posted, there’s a shortened bit, you can click on that. Enter your information on the strategic treasure website for that survey report, fill in the information. And then I’m not sure how quickly you get the report, you get it pretty quickly, that would be great to go ahead and do that while while we’re in the webinar, we’ve got some more actions for you as well. So webinars is not just eating popcorn, but listening and clicking I guess we’re adding some, some responsibility. So thank you for being a great audience in putting up with that. So our first poll question. If you don’t see it, you can see the chat box how to find it. But all tabs sometimes can bring the whole question to the front or look on your second or third or fourth screen to see where that may have popped up. But the first question is about visibility. Which of the following reports would you like same day, or real time visibility to this is multiple choice so you can select as many as are applicable? It starts with payment channels goes to the cash flow forecast or cash flow calendar, reason codes for unapplied payments all the way down to rejected or other and we’re assuming that there’s none, that there’s nobody who would say none, you know, which ones would you like, same day in real time. So, you know, fairly current visibility, go ahead and select all that. Any of the ones that apply and then hit submit. And when you’re done with that, also in the chat box, you can follow Corcentric on LinkedIn and Strategic Treasurer by clicking that link. If you’re on LinkedIn, you can go ahead and follow the companies and stay current with us or our chat and chatter that would be excellent as well. So I think people are still filling out the poll, the poll. If you want to see the results of all the poll questions in the report available appear on these pages where this poll either type the word poll or Corcentric, of course centered would be the advanced person typing that just as a reminder who underwrote the survey, so Corcentric or poll, if we get 100. I will send that out to everybody. So please feel free to drop that in. Anthony. We just got a ton of information back on the poll question. It seems like number one is the cash flow forecast that will be talked about later because that’s very consistent unapplied payments and rejected disputed invoices are pretty high there. I don’t know if you wanted to comment on that or anything else you got a free freestyle option to comment on.
Anthony Mignogna 14:24
Yeah, I mean, never have I ever heard I want less visibility. Right. But I think you know, there’s some clear clear trends here right the unapplied payments, the forecast calendar you know rejected disputed all kind of point to you know, that predictability, right and visibility. element of receivables that’s, quite frankly always a challenge right? In particular, forecasting, sometimes a little bit more of an art than a science right depending on it. Do you know how reliable your customers are paying on time? Right? Due Dates versus their check runs? And, and those types of things? But yeah, pretty interesting. I think the other one on the other side, that’s, that’s pretty low as a team productivity, right. So it seems like that’s maybe less of a priority. But also, you know, in a way, you could look at team productivity as an output of, you know, processing these things. It’s a little bit of a different dataset, probably harder to get to.
Craig Jeffery 15:30
Yeah, you know, I liked your comment about never have ever seen anybody want less visibility. That reminds me the other side, Never Have I Ever Wanted slower data. Never ever, ever wanted slower payments, it doesn’t mean that I always want 100% visibility to everything that exists, right? That could be overload. Same thing with speed. So I’m going to steal that Never have I ever in the future. And I’m just saying that publicly. So you know, I’ll try to attribute it to you. But I might not be able to say your last name very well.
Anthony Mignogna 16:02
No pride of authorship here.
Craig Jeffery 16:05
All right. Thanks, Anthony. So that finished our first poll question. Thank you so much for for taking that. And the best part is that Brian has to count up all the Corcentric and polls to see, see if we hit the number and I can stop banging every bit on it. So real time visibility. That was one of the first ones. You know, we got the two year look back here. Blue is 2022. Like an orange or orange color for 2023. You can see, I’ll let you comment on this Anthony. So payment channels, bumped up six points. Cash flow forecast jumped up seven points, pretty notably, unapplied payments, still significant, but consistent reason codes for unapplied payments. That’s a that’s a 12 point jump, that’s the most significant. So this is, this tells us a little bit about the details about what type of real time or really current visibility matters. Anthony, any any thoughts here?
Anthony Mignogna 17:08
Yeah, I mean, we’re seeing forecasts. I mean, I think it’s kind of always important, but it’s growing, you know, from a priority standpoint, because of the increasing cost of capital, right, and, you know, supply chains and, and those types of things getting getting a bit stretch. The reason codes, one was interesting, you know, because I think, like, first step one, get visibility to unapplied payments, right. But then next question is, why is it unapplied? And where does it go? Because unapplied payments get harder to apply as, as time goes on. Right? So the ability to you know, apply those quickly and efficiently and accurately, you know, becomes more important, right, I think that’s kind of what we’re seeing here.
Craig Jeffery 17:58
Yeah, and just Just a note, turn the bottom of the screen you can see not all answer choices are displayed. So there is there is a method to our approach of those who take the survey get a lot more details than those who don’t take the survey, we still provide a general report which is quite useful, but those who take it get some additional details. So that’s meant to be an incentive for people to take it and invest some of the time and it pays off in a couple of different ways including additional info so our next poll question shows up this is inbound payments security has become what significant more important more important about the same less important significantly less important and we didn’t give you an option for I don’t know so you got to force a decision on which one is the most appropriate for your organization’s we’ll look back over two years as inbound payments security become more important or less and go ahead and plug that in. So I’m told by Brian that we still need half of the number of selling 50 Corcentric or polls typed in the chat box so I’d love if you guys could I want to say anything more and it just goes all the way thank you. Makes me happy in my heart.
Anthony Mignogna 19:20
I bet you I could guess which one of these is going to be the highest.
Craig Jeffery 19:24
Well, I don’t want to write it down on a piece of paper and be ready to say it but let’s not let’s not let’s not bias everybody towards making Anthony happy.
Anthony Mignogna 19:34
Poison the well.
Craig Jeffery 19:37
I think I probably think the same as you on this one but we’ll give everybody a moment All right. Is this what you were expecting?
Anthony Mignogna 19:51
I was I would have. I definitely expected the top ones to be the most popular I thought that we would see like one long bar And in either more important or significantly more important. So the fact that there’s a bit of a spread between the top three is a little surprising.
Craig Jeffery 20:08
In a lot of the, in a lot of the webinars we do when we ask this type of question, it’s, it’s very heavily skewed towards the more important and significant more important is usually last, not just by three points, about the same. And then this 3% or less viewed as, as less important. Sometimes it’s zero, even with hundreds of people responding, sometimes it’s zero. So when you look at the skew, it’s like, it’s it’s very much between more important and significantly more important, because we’ve got, you know, 75% there and just 23%, about the same. So, you know, our purpose and, you know, asking this is just to see where, where the audience is, and to amplify what we’re, we’re looking at. So, yeah, thanks for your comments, Anthony. What’s a poll show us, I’ll set it up at the end, you’ve got a number of things to say on fraud. Just a couple couple items, the left side is payment redirection. And it’s 25%. I think it’s 24.5, we round it, it suffered a loss or inconvenience due to redirected payments. So a quarter of the population experienced that an actual loss or an inconvenience, and then the payment security concerns 70% identified it as more important or to give it more important. Two years ago, so are our poll today, those who are sitting on the webinar, that was 75%. So fairly close. And in the in the survey, nobody indicated the decrease in importance that was 0% compared to the 3%, a combination of one and 2%. So pretty close to the survey results, Anthony. Any, any additional color you want to provide here and have people looking at fraud? Yeah, I mean, I think it’s getting more important because it’s becoming more prevalent, right, as we move to a variety of payment channels, you know, there’s a variety of angles for for fraudsters, as I say, and we’re seeing it, you know, in the conversations that we’re having with finance professionals, climbing the ranks of priority, as it relates to decision criteria for AR solutions. Right. You know, whereas, historically, my might have been, like, you know, part of it now, it’s a main part of that decision process. And, you know, obviously, moving towards electronic payment methods is one way to increase security. And really, you know, it’s, we have, we have AP and AR conversations, and it’s a conversation on both sides, right. So the people that are paying you for investing in, in fraud prevention, and as are those that are receiving payments. And so this is a really good opportunity to really partner with your customers, to ensuring that payment instructions are decoupled from the actual invoice, you know, and that there’s there’s security on both sides of it. So that, that that redirected payments, risk is mitigated as much as possible. Yeah, fair points. The next one is the next question and the slide that we’re looking at is about scaling in order to collect what what activities require attention to allow an organization to handle increased volumes or increased scale. The three areas these are extremely close, right, there’s, you can look at all the different results. But the variation is between 46 and 48%. So just about half of all companies say, here are some of the gating items, right, so a little bit just over half, don’t see these as gating items or issues that have to be resolved. So it’s about 5050. Here, from cash application collection and reconciliation. Anthony, in a year in this area a lot. I don’t know if there’s an additional guidance and description of why this is likely the case. What what people are doing about it?
Anthony Mignogna 24:34
Yeah, I mean, I think in organizations that are, you know, high growth, this can be a bit of a barrier. And you know, that the, a lot of times, especially in more manual environments, right, we’ll talk about kind of efficiencies and those types of things later, right. But your back office kind of has to scale with the growth of the rest of your organization. And there’s some things that companies can do. Right, I would say, you know, investing in solutions that can help make cash application more efficient, is going to help the reconciliation on the back end, you know, helping drive more automation and visibility, it’s going to help drive more efficiencies in collections so that the AR personnel doesn’t have to directly increase with your, with your revenue growth. And you can look at other solutions that can help kind of bring those things in line, as well. But, you know, this is a common visibility, scalability and predictability are probably the top three conversations that we’re having as it relates to receivables. Because of that issue, especially high growth industries, and high growth organizations.
Craig Jeffery 25:55
This next, this next result, we’re showing a three year, you know, three year span, and what’s happening now is that when we look at when we look at data and research, you know, getting one year’s worth of data is kind of like, that’s interesting. But when you can factor that in, in some areas, when you look and you see, here’s a trend over time that can inform us help us do things differently. And so this, you know, this arc of arc of time, you know, longitudinally, as they say in statistics, right, you know, 50% 46% 29%. So this is about receiving and posting payments are, or using bank provider receivable systems for posting payments. There’s a range of items that could be interpreted that, but I mean, what we’re seeing is, is a decline here this this is this is certainly an ongoing trend. And Anthony, what are what are people thinking about and doing are banks exiting the business or I know, lock boxes are closing down? And that’s becoming certainly for paper based items. That’s becoming less important. Too many thoughts here?
Anthony Mignogna 27:11
Yeah, I mean, I think this kind of coincides with the emergence of more, you know, I think the industry term would be FinTech solutions, right. And as those solutions get better and better, you know, banks kind of go back towards focusing on their core competency, which is banking, not software. Right. And I think organizations, you know, are now investing in in FinTech solutions to support their receivables. I think the AR side of that is, you know, catching up to the AP side. From a technology standpoint, you know, and as such, the leveraging the bank’s systems to do that is becoming less popular.
Craig Jeffery 27:56
You know, Anthony, just a good question. That is, you know, generally, it seems, it seems to me, this is not survey data that banks and fintechs are partnering more, and that partnership is perhaps more apparent now. It used to be banks always wanted to white label everything. And now it’s it’s not that’s not viewed negatively, it’s oftentimes viewed positively, in some ways, like the banks are partnering with the right fintechs. And that’s more apparent to the market. How much of this is that? The general change in who’s doing it? And how much of this is just maybe more transparency to, you know, the ecosystem that the banks are plugging into?
Anthony Mignogna 28:43
Yeah, I think that’s a good observation. Right, where, you know, historically, the white labeling was probably more prevalent, because it was an asset to have that underneath your brand. Whereas now partnering with the right Fintech is an asset from a brand standpoint, right. As those solutions have improved. So I think that’s, that’s accurate.
Craig Jeffery 29:06
Yeah. Excellent. So we had a question come in on the broad concerns. I want to pop up the next poll question to let people answer that. There was a question about how much do fraud concerns vary between outgoing as opposed to incoming payments. So how concerned is, let’s say the AR side, about fraud versus the outgoing side. So I don’t remember all of this statistics, but concerns about fraud on the AP side is is certainly higher than the 25% those who’ve suffered losses. So it seems to be a little bit higher on that side. But that might be a good thing for us to put an article out about outgoing in going in coming fraud concerns, see where the differences but the biggest area where there’s losses is on the AP side. That’s number one. AR is an area that’s been pretty ripe and hammered heavily as well. So, you know, everyone’s everyone’s feeling pain, I think a little bit more pain on the outbound side. But the criminals are getting pretty good at hitting every area if you’re not watching it. So the the poll question. Yeah, Anthony, we are asking you to respond to up to three pain points. We’re not monitoring it for we can’t we can’t stop you from doing that. We want to be mad at you. But what task is the largest pain point in your AR process? We’ve got forecasting all the way down to other. So what are the when you look at those? And if you’re in the AR area? What are your biggest pain points, if you deal with the AR group, maybe you’re in Treasury, or maybe you’re an AP, identify what you think is the best result there. And go ahead and hit submit. While you’re doing that, I think Brian’s going to pop up another link for somebody to follow the chat box. Because we can I don’t know maybe we hit our number. Yeah, so the following Corcentric and Strategic Treasurer, that would be awesome. I’ll ask Brian to also put up CTMfile, which is our treasury media site covers the cash conversion cycle. We would absolutely love it. If more people would follow that we took it over a couple years ago. It’s growing nicely. Love people to look at it. And also informed by Brian that we need about 18 more Corcentric or poll in the chat box. All right. A lot of chatter there. Thanks for following CTMfile, or Corcentric and Strategic Treasurer, he’ll pop that up in the chat box. You’re doing it while it’s there is is quite pleasing helpful to us. Our marketing team loves that. Marketing groups happy painpoints. Anthony, This almost looks like we listed the pain points in order of the results with a few few switch apps there the accessing customer portals should go a little bit lower. But for the most part, it runs from the top to the bottom forecasting is a key issue here. Yeah, describe describe how you react to this, this information and what this might mean.
Anthony Mignogna 32:32
Yeah, I mean, it’s it’s a pretty even spread there at the top. And it kind of aligns with some of the survey results that we’ve talked about, right forecasting this visibility dealing with complexity. Staff intensive, we kind of touched on that related to scalability. I think those are kind of two sides of the same coin. And I think, you know, probably more so last year, when there was a lot of turnover, right? Those Those become shocks to the system a bit. Right. So the more staff intensive work you have, the more the more effects you have from from turnover in your in your HR department. Accessing customer portals, you know, is a conversation we have quite a bit, right. But it’s a little bit of, you know, a self fulfilling prophecy. Right, because if somebody’s calling me about it, obviously, that’s their biggest pain point. But the ones that don’t think it’s a pinpoint aren’t calling, calling me about it. So, you know, I think that’s probably the starkest, you know, gap, right. It’s that one, that one’s pretty low. But yeah, I mean, complexity. And visibility and predictability are kind of front center on this one.
Craig Jeffery 33:56
You know, that accessing customer portals, just as we’ve done surveys multiple years and seen as accessing customer portals seem to be at least my memory seems to be informing me that that was a bigger issue some years back where it’s like, every every payable system has you go into their their portal, and you’re like, I’m receiving stuff, why do I have to go into all these different portals? That seems to have been moderated a bit over the past few years? Is that what you generally see to I mean, 13% isn’t a huge number, but it was a real significant pain point. Not not too long.
Anthony Mignogna 34:37
Yeah. And I think this ties to, you know, that what we’re talking about before, usually when there’s a an efficiency problem that can be solved by technology, it corrects pretty quickly, right? Because, you know, the FinTech industry is has matured extremely rapidly. And so, you know, building those connectors, I think as well largely happened over the last couple years. And, you know, organizations have invested in those solutions. So I would say that’s probably where, where we see that decrease.
Craig Jeffery 35:10
All right, so I think we’re pretty close to the total core Centrix, or Paul’s there more within just a few. So I know we’ll go over. So feel free to download this survey report. We’re gonna jump back into a detailed chart here. So what are we seeing here? This, these are some of the same questions we asked in the poll. This was from the survey, we asked people to select the top three. And so you’re selecting from among a number, I don’t know if the numbers are exactly the same in our poll, as they were in the survey. But, Anthony, if we look across the the orange color forecasting, in our poll here was 52%. It was 31% for staff intensive work around collections. And for reporting visibility was 43%. So quite a bit higher numbers here. So I, if I’m adding up the numbers in my head from before, I think people are answering more than three. And if they answered more than three, there, there is a little bit of a shift because collection work and visibility were almost the same 26 and 29%. Here from the survey. The poll, though showed reporting visibility, notably more important by 12 points when people were freed up from the top three. You know, as you look at these, you can talk about any area or all areas. You know, why is forecasting so important? What’s going on? Collection work? Go for it.
Anthony Mignogna 36:51
Yeah, I mean, the interesting part about this graphic is kind of the trend lines, right? So, you know, forecasting, kind of touched on this earlier, from a macroeconomic standpoint, capital is becoming more expensive, capital is becoming less available. And so it’s becoming more important. And it’s probably becoming harder to collect. So that 3x Jump in forecasting, I think, is kind of a sign of the times the the reduction in staffing intensive work, I would tie to what we saw during the pandemic was a significant investment in technology, automation solutions, right, to alleviate, you know, back office work, because people couldn’t go to the office anymore, right. So it’s kind of born out of necessity. And, you know, investment in those solutions has, has yielded some some efficiencies there. But it hasn’t solved for the forecasting and predictability problem. Right. And And interestingly, it hasn’t. It hasn’t really solved the visibility problem, which typically you would associate with, you know, technology solutions being deficiency and visibility. Right. Sounds like there’s still a bit of a shortcoming there.
Craig Jeffery 38:10
Yeah, excellent. You know, a couple of comments on the forecast. And then at the end, if you can see the questions, I think some some of them came in from LinkedIn live. And they’re, they’re making their way into the chat box. I think Brian’s copying them over and just just by way of notification, those who joined at LinkedIn live. Welcome. Thanks for joining through that channel. We started doing that about I don’t know, six, nine months ago. Very interesting. The rest, the majority of people are coming through on the Zoom webinars. So there’s some questions there. I don’t want to take those in a moment. But to the to the pain point on forecasting, seen it moved from 13% to 39%. And a few years, we see forecasting show up. It seems seemingly everywhere, certainly in the treasury space, for the past eight or 10 years. That’s a key area. It’s a focus, an area where companies spend Treasury groups spend most of their time we’re seeing this emerge on the payable side and the receivable side, like here, this tripling. And I think your points were, were very good to explain why, right, this. Rates rates are getting higher, complete availability of cash and credit is declining. So there’s a number of factors that are driving this. They would spend more time and, and we can look and look at technology results as well. People are using AI and machine learning when it’s available through systems to do forecasting. So forecasting is such a big issue across all areas of finance. It’s really, really, really dramatic. You know, on the AR side, we saw this peak when we had in the spring of 2020 with COVID-19. That concern shot really, really high and they moderated as you know, payments still kept coming in. But a lot, a lot of items there any, any other thoughts on what I just said, Anthony?
Anthony Mignogna 40:16
Well, I think the other issue with forecasting is really hard. Right? So, you know, about the future. Right, exactly. We could we could tell the future we don’t be retired. You know, but I think I think that’s part of the issue. Right? It’s, it’s, it’s really difficult to solve that. And so it stays, it stays in issue, if that makes sense. Right. Whereas earlier, we’re talking about connecting the customer portals was an issue. Now it’s less of an issue, right? Because markets kind of solved it, right? Forecasting sounds like something that’s still, you know, hasn’t been solved.
Craig Jeffery 40:57
Okay. A couple housekeeping items that I’ve been reminded of here, we have credits, CPE credits, some of the credits that are offered CPE. Those are only available through the Zoom webinar platform that LinkedIn live due to the requirements placed on by those that have those professional designations. So just a heads up, I think probably everybody knows that. But that’s just a reminder. And Brian, if you would go ahead and post the link to the LinkedIn group for CTP credits, so that people can connect there. That’s another way of getting some notification on being part of that group. That’s a group that we’re growing. For. Look how fast that was. That was awesome. Brian’s doing. So we’re all we’re all good on the polls. And yeah, excellent. So let’s let’s go to the bank services for clients slide here, which is we just we just showed you, several data points that showed forecast is more important for AR, it’s more important for AR. And we looked at some numbers and saw, you know, a poll from those who are on this webinar 52%. So this is one of their top three pain points. Here we see a decline. But I also want to put this in some context to say that we don’t see this decline of importance on forecasting anywhere else. But from a banker perspective, banker, same forecasting services are decreasing importance, they’ve dropped 20 points over this four year span or three year span, across four different surveys. So it comes down to 57%, which is still higher than the 52%, which was the peak pain point application on today’s poll. But I guess my, like, my question are clear to you, Anthony, is that banks serve a lot of customers. So because it’s important to so many customers, this seems like it’s moving in the wrong direction from what corporations and companies need. Your thoughts there?
Anthony Mignogna 43:13
Yeah, it’s, it’s interesting, it’s almost the exact same decline that we saw in the software, one, or the, the, the leveraging banks for receivables system, about 20%. You know, and I think this, this maybe is more of a reflection of banks, focusing on their core competencies from a, from an offering standpoint, as opposed to their reaction to the demand in the market. And, you know, similarly, right, as a FinTech tech space continues to emerge and grow and mature. They’re coming with their own forecasting solutions, right. And so that would be kind of my read on it, right? It’s just banks kind of getting out of that forecasting services business.
Craig Jeffery 44:09
Yeah. So that there’s a question that came in from Steve, Steven from LinkedIn live. Here’s the question, let me let me just read it. It may not be one that we can answer on a broad webinar, but it says Are there any banks were successfully offering AR and cash application solutions or cash app solutions to their corporate clients? Right? So you know, here’s, here’s a lockbox that takes all kinds of payments and applies them perhaps to outstanding receivables and then qualifying it don’t need to name financial institutions, whether examples of how and where you’re seeing them successfully deliver AR solutions and you know, Steve, and I know that you know, fintechs are, are doing this and delivering that through the through banks, or we’re certainly see that where they have the receivables, they’re using AI and other methods of matching and providing that pre matched information. And that seems to be done more through partnerships. What are you seeing without, you know, like Steven mentioned, not just naming names.
Anthony Mignogna 45:21
Yeah, I mean, I think it’s kind of similar. I was saying before is that I well, you know, as a third party provider of AR and AP solutions, right. So we we typically be that as something that software companies provide in partnership with banks. I’m sure there are banks that have solutions out there, whether they’re homegrown, or white labeled. I’m not sure.
Craig Jeffery 45:49
Yeah, I always remember, federal, I always remember, but it was multiple decades ago, when a bank in the northern Midwest, offered a solution where they were taking the receivables file, and doing the matching and then send it back. And they were from, from my knowledge, the market was one of the first ones and that was, that was pretty revolutionary in terms of how that was done and what occurred. And that was with tech that was available a long time ago. Wasn’t today’s Tech, there was no, there was no machine learning no engines that supported that. So as we move forward through time today, it’s quite good. Excellent. There’s another question. Are these needs going away for banks, because corporations are training and fintechs are don’t think of banks having forecasting solutions? So this is about the forecasts and solution? We don’t have for survey data on this. I’m happy to, to jump in and answer as well, if you if you don’t want to take it. But I’ll give you first crack at it.
Anthony Mignogna 47:03
That was my read on it. Right? Is that the this is a reflection of the market moving more towards organizations leveraging fintech. Right, and therefore banks kind of moving out of the offering these services. I mean, you know, 57%, something askew side, right. So three out of five, still offer it, right, but it’s just down from kind of three out of four.
Craig Jeffery 47:27
Down a level of importance, right. So yeah, good stuff. Some other questions about interesting to note that forecasting percentage in 2018 and 2019. Did it increase prioritization for banks? I don’t know. But it certainly increased attention. We did a we formed the Treasury Coalition when COVID hit, and we were surveying everybody, the market weekly than bi weekly than monthly, and then less frequently to see the concerns. And that was really fascinating to see concerns, shoot through the roof, and then moderate over time. And Gordon, put, put a good comment in there about the difference between forecasting receivables, receivables solution, and the operation of posting and applying receivables to accounts. Those are there’s a lot of nuances there. So good, good comments. Anthony, anything else on bank services for clients generally? Good. I’m good. Alright, so you know, as we move to the to the takeaways, I do want to point before we before we go these items, Anthony, if you’ll cover the first two, I’ll cover the last two as we had pre decided ahead of time, Brian, if you would pop up a couple of those things, the link for the report in the in the chat box, just to make sure everybody can can download that same thing with a CTP list, if you would join that group as well, that would be most most helpful to us. But also, I think, to you, especially if you’re a CTP or you have CPE credits you need. We’re trying to share that information regularly. So thank you for your your attention there. But so what what do we need to take back to the office? What what should you be thinking about? So we’ll talk through what Anthony I think makes sense from this data information and our view of the market.
Anthony Mignogna 49:34
Yeah, I mean, I think, you know, going back to the beginning of the webinar, b2b commerce complexity is increasing on both sides of the AR boundary. So, you know, knowing that as kind of a a given right that then, you know, it’s about planning, planning for it and Creating ways to manage it. Right, streamline it and, you know, understanding that that complexity is not going away. And ultimately, you know, looking at where are the gaps in your process? I think were the, some of the key themes from a pain point standpoint was visibility, scalability, predictability, right. So, when you’re looking at how do you optimize your internal processes, how do you optimize your, you know, your internal organizational structure? You know, as organizations grow, defining roles, who does what and how, right, so people process and then, you know, the technology piece comes in later, as far as, you know, identifying solutions that are that are truly going to solve the issues that you face and, and the priorities that you have.
Craig Jeffery 50:52
Yeah, as we look at fraud or security fragments are not going away. Not only that, that’s an understatement, they, the criminals are more well funded, they’re finding other weaknesses, exploiting them, even as we close things up. And so, you know, vigilance, tech services, all of these can help protect the inbound side, as well as the outbound side of it. It requires this constant vigilance, not like we’ve got this knocked out. And we can rest. It’s the, you know, the enemy, the criminals are constantly trying to find the weaknesses, new areas to exploit, you know, corporate defenses. And so you know, when we can layer in technology or services, it makes sense. Finally, here is do not forget the human element to our defenses, don’t just upgrade your firewall and your antivirus. But make sure the human element people are being trained on payments, on payment, fraud, payment, security, and that this is a regular recurring, it’s not I got updated, and I’m set for life. It’s a how do I do that on a regular basis, this is vital and essential. On the on the view, this is against the visibility, who really needs better visibility internally? What did they need to see making that data available matters? Jeff Bezos, you know, from from Amazon, said something along the lines of if anybody has data in any area department that doesn’t make it available to the company to he didn’t say exploit, but really to leverage and use as a powerful tool to help them run their business better. I think he indicated that they would be fired, like housing and making data secret is not a winning solution. And that’s not a winning solution in our individual organizations. But really, what’s the view? What what do our partners need to know? What do they need to see, if we have a clean, you know, clean process on the outbound side or in the inbound side, we can make the the issues and the pain of the other party lower, which will in turn make it more efficient, which will involve our staff at a lower level, a decreased level and it matters. So add the data, add the visibility needs to your list of what you’re trying to accomplish. Now, I also would ask that, if you look in the chat box, Brian will put up the CTMfile website CTMfile.com, as well as the Corcentric site. CTMfile.com is a media site. And there’s a way to subscribe to the newsletter, we’d really encourage you to do that at CTMfile.com. CTM stands for cash and treasury management, Corcentric is a provider of all kinds of services, particularly in the AR space. And really appreciate your underwriting this year’s research. Anthony, your team, this is great. And there’s certainly more information you can find on Corcentric.com and from some of the links that you see up here, so we’d love for you to connect in these different ways to the different assets that we have. Thank you so much, Anthony. And I think if you had any final comments, shout them out as we turn things back over to Brian for just a few more important PSAs.
Anthony Mignogna 54:30
Thank you, Craig. It was a pleasure. This was fun. Appreciate it.
Craig Jeffery 54:35
Yeah, thank you. Brian, bringing you back online.
Thank you, Craig. Thank you, Anthony. And thank you, everyone for joining us today. The CTP credits. Today’s webinar slides, and the recording of today’s webinar will be sent to you within five business days. And for more in depth analysis of the 2023 Modernizing AR Processing Survey, be sure to download the survey report by clicking the link in the chat box. Thank you, and we hope you have a good rest of the day.