Despite all of the technology at our disposal and the importance of accurate and complete data, many teams managing large amounts of rebates still rely on manual processes for calculating, accruing and allocating rebates. They often find themselves chasing down errors, reconciling data, and trying to make important decisions based on an assortment of incomplete or inaccurate rebate data.
In fact, research has found that procurement, supply chain, and finance professionals are spending almost a third (31%) of their time dealing with inefficient paper-based or manual processes, which is costing businesses on average £1.94m ($2.6m) annually. Just because a process has been executed one way for a long time doesn’t necessarily make it the best option.
In order to outperform competition, streamline processes, and ensure accuracy many organizations are turning to digital transformation and implementing various software across all departments. Automated rebate management software is a must for those who want to accurately manage highly complex B2B deals and rebates.
Find out the key differences between manual processes and automated processes in our table below.
Manual Process Automated Process Human involvement Entirely dependent on human effort to add, edit, update and recheck the data The software automatically calculates, accrues and allocates rebates for you with minimal human intervention Reminders Manual nudging for amendments and approvals, often after an error is found Proactive email notifications to both internal team members and trading partners. Audit trail Data is easy to falsify and can easily miss certain information unless told. The system logs every action with the accurate time and date. Communication Communication often happens outside of the process via email or call. All communication stored within the tool so can keep track of what has been said. Speed This is a lengthy process due to data being stored in multiple tools and across various documents. With everything in one centralized platform, this is a much shorter process. Accuracy The possibility of human error to occur is large, due to the amount and complexity of the data and key person dependency. The system is centralized and collect information on a real-time basis. By minimizing human intervention, the scope of errors is marginal. Security This is a less secure method as it involves a lot of paperwork and documents being emailed over and anyone can access it. This is a more secure process as data is hosted in the cloud and password protected. Scalability As the amount of data grows, you will notice performance issues. E.g. a spreadsheet will become slow to load and slow to calculate. Built to serve a large number of stakeholders, allowing for multiple users and capable of managing 300+ types of deals. Approvals The manual approval process can create a lot of back and forth and hold-ups. Extra time is required to track down contracts for approval, often leading to missed deadlines and disputes. Through an automated collaboration platform, it automatically creates a trading agreement and sends to the assigned approver for speedy sign off. Productivity Individuals may end up wasting too much time and effort on low-value activities or becoming frustrated with the spreadsheet. In the long run, this method saves time, effort, resources and is more reliable. Rebate accountants are free to focus on high-value activity instead. Reporting Time consuming to retrieve data from different sources and compile it into a detailed report. Rebate management software generates customized, detailed reports so you can track deal performance and attain profitable growth.
The way rebate management has always been done is not sustainable—especially in our current environment. Manual processes tend to be clunky, chaotic and time-consuming, and with so many organizations now working remotely, the challenges are even greater. We explore these in detail below.
A McKinsey study found that 60% of all occupations have at least 30% of activities that could be automated. However, finance has been slow to approach automation with only 19% of CFOs having automated nearly all of their finance processes. The opportunity is out there for rebate professionals to grasp onto, by automating the most time-consuming, manual processes your organization will be transformed and see the following benefits:
To conclude, it is evident that using manual processes for rebate management heightens risk, has a negative effect on the bottom line and deal performance can be compromised. By making the decision to automate your rebate management processes today you’ll be on track to mitigate business risk, increase operational efficiency and boost financial performance.