One of the biggest challenges in cash flow management is unpredictability. The other is time. When will a large customer settle what they owe? When will Sales bring in a large new account — and how quickly can this account be up and generating revenue? Working capital management can create tension between buyers and suppliers. While you prefer to hold on to your cash, your suppliers would like to get paid sooner to improve their cash flow. You can resolve the tension by routinely taking advantage of suppliers' early-payment discounts. But those opportunities are often lost in a sea of paper invoices, or bypassed when prevailing cash management strategies call for delaying payment to earn interest on cash balances. Meanwhile, the conflicting priorities can put cash-flow pressure on your suppliers.
In this Ariba Knowledge Nugget, I will discuss some of the concerns you are likely hearing in your finance organization and likely from the CFO.
Finance professionals need improved visibility into and control over spend on a global basis, tools to automate and align the procure-to-pay process, as well as dynamic discount and trade finance solutions to optimize working capital management.