Levelling Up your Oracle Cloud Deployment – Advanced Collections

Levelling Up your Oracle Cloud Deployment – Advanced Collections

Author: David Lapham, ERP Consultant at Namos Solutions

So far this blog series has focussed on Levelling up your Oracle Cloud Deployment by implementing modules that may not have been scope for your initial deployment. While Advanced Collections is certainly a module that is not always included in the original scope, it is perhaps the ERP module that has most benefitted in recent years from the additional functionality released in the quarterly updates. Several of these releases have been sufficiently transformative that if your Advanced Collections deployment is more than a few years old there are likely new features you could be leveraging to improve debt recovery and reduce debtor days.

For those already utilising Advanced Collections, this blog will summarise the features included in recent releases and offer some considerations on how they could be used to level up your deployment. For those not yet enjoying Advanced Collections, it will highlight some of the enhanced options now available to you, should you choose to implement Advanced Collections.

Segmentation

Segmentation allows you to assign different collections strategies to different groups of customers based on various determinants such as business unit, profile class, and remaining amount due. You can assign different scoring formulas and delinquent strategy groups to the customers, and collectors can define the pre-delinquency options. You can also assign the predelinquent strategy groups to the customers.

This enables greater flexibility in the assignment of strategies in scenarios where it is necessary to chase debts in different ways. 

You can manage this feature from your work area and the Customer page. For example, you can view the multiple strategies running against the same customer under the Strategies tab on the Customer page. If the setup process is complete, the predelinquent strategies are also displayed on the landing page.

The assignments are defined as the default scoring formula. The delinquent strategy group assignments are defined at each business level. The scoring formulas and delinquent strategy groups are displayed automatically. You can change the groups to any scoring formulas or strategy groups that are defined based on your business requirements.

You can use the Manage Collections Scoring and Strategy Assignments task to define the scoring formula and delinquent strategy assignments.

You must specify the segments and enter the detailed assignments in the Delinquent Strategy Assignments by Segment region under the Manage Collections Scoring and Strategy Assignments task. A segment is defined as a set or subset of various objects identified for scoring. The segmentation is implemented through each business unit and profile class, and define the segmentation for the Customer, Account, or Site business levels. For example, define the segment name Business Level + BU + Profile + High / Low Amount, for each segment including the default values.

Define the Amount Due Lower or Upper Threshold and the corresponding delinquent strategy groups to use when the amount due is below the lower threshold or above the upper threshold. You can define one, both, or none of the thresholds.

  • Amount Overdue Lower Threshold: The lower threshold for the customer’s amount overdue below which the Below Threshold Strategy Group is used.
  • Below Threshold Strategy Group: The strategy group assignment when the customer’s amount overdue is less than the Amount Overdue Lower Threshold.
  • Amount Overdue Upper Threshold: The upper threshold for the customer’s amount overdue above which the Above Threshold Strategy Group is used.
  • Above Threshold Strategy Group: The strategy group assignment when the customer’s amount overdue is more than the Amount Overdue Upper Threshold.

Here are some of the various scenarios to specify default scoring and strategy assignments:

  1. Scoring and strategy assignments for various business levels: You can set up the default scoring formula and strategy group for all the three business levels. The scores are calculated based on the default scoring formula for the business level of customers, and delinquent strategies which are assigned based on the default strategy group for each business level.
  2. Scoring and strategy assignments by business unit: The scoring formula is different based on your business unit. You can use different scoring formulas and strategy groups for the selected business units, and you can use one scoring formula and strategy group for the remaining business units.
  3. Scoring and strategy assignments by profile class: The delinquent customers who belong to the different profile classes, and their scores are calculated based on the different scoring formulas and the strategies are assigned based on the different strategy groups.
  4. Scoring and strategy assignments by amount overdue lower threshold: You can specify the amount overdue lower threshold for each business unit and the strategy groups for the below threshold. If a customer’s amount remaining due is less than the amount overdue lower threshold, then the strategy group specified for the below threshold is assigned. Otherwise, by default the delinquent strategy group defined in the assignments is assigned.
  5. Scoring and strategy assignments by business unit and profile class: The scores are calculated based on the various scoring formula for that specific business unit and profile class, and the strategies are assigned based on the various strategy groups.
  6. Scoring and strategy assignments by amount overdue lower and upper thresholds:
    • If a customer’s amount remaining due is less than the amount overdue lower threshold, then the strategy group specified for the below threshold is assigned.
    • If a customer’s amount remaining due is more than the amount overdue upper threshold, then the strategy group specified for the above threshold is assigned. Otherwise, the delinquent strategy group defined in the assignments is assigned.

Transaction Type Strategy Assignment

Transaction Type Strategy Assignment adds a further layer of flexibility into Strategy assignment by enabling different strategies to be applied to different transaction types.

Transaction Level Strategy Tasks can be grouped into methods and assigned to specific transaction types thus allowing the ‘Wait Times’ to be assigned to different transactions which allows the Dunning timeline to vary with different products or services.

You can define and run strategies and strategy tasks for individual transactions by transaction type. Use the Manage Collections Strategies page to specify the transaction type and create/add the strategy task against the transaction type, when these strategy tasks are applicable to a transaction.

For example, create a strategy and define ‘n’ number of transaction types for the strategy, and create/add ‘n’ number of tasks for each transaction type. The ‘Process Strategy Task’ evaluates the transaction type of each transaction and assigns the strategy tasks accordingly.

Site Strategy:

Transaction TypeStrategy Task
License InvoiceSoft letter,
Soft call
Royalty InvoiceSend Soft Dunning Letter,
Send Medium Dunning Letter

Say a party has 3 delinquent transactions and Site Strategy opened on the customer. Strategy Tasks got assigned to transaction basis transaction type.

Transaction NumberTransaction TypeStrategy Tasks
TRX1License InvoiceSoft Letter,
Soft Call
TRX2Royalty InvoiceSend Soft Dunning Letter,
Send Medium Dunning Letter
TRX3License InvoiceSoft Letter,
Soft Call
IEX Dunning Customers

The business benefits include:

  • Extends the capability of assigning delinquent strategies to transaction by transaction type.
  • Improves the collections process by focusing the delinquent tasks for specific customers and transactions.

Transaction Level Dunning

Before this feature was released, it was only possible for dunning to take place at customer, account, or site level. This would mean, depending on the level selected, consolidated dunning letters would be sent which included all delinquent transactions for a particular site, account, or all of a customer’s accounts depending on the level selected.

While this functionality was suitable for many situations, for a number of organisations it failed to provide the level of flexibility required. Transaction level dunning enables the issuance of dunning letters on a per transaction basis. This means each transaction can have a separate sequence of strategy tasks, independently aging, and with more granular control over those letters being sent.

Even greater flexibility and control was later added, such that the timing of those transaction level dunning letters could be based either a flexible wait time between letters, or simply on the number of days the transaction is past due.

Transaction level dunning can be complemented by Segmentation and Transaction Type Strategy Assignment, as outlined earlier in this blog to great effect, for example in such scenarios as:

  • You need to escalate debts very quickly through your collections process, but are concerned about the customer experience of a newly delinquent invoice being included for the first time on a late-stage severe dunning letter.
  • Legal or legislative requirements necessitate including specific text in each stage of your letters for every transaction, so cannot have a newly delinquent debt picked up on a strategy that is already part way through.
  • Your organisation has multiple lines of business, or particular product or service categories, that would require dunning on different timelines.
  • Your dunning letters need to include different text or notices that are specific to the different types of goods or services you supply.
  • You need to tailor your collections process to the different groups of customers with which you do business.

Clearly this level of flexibility requires great care and attention in designing the solution to best meet your organisations specific needs. Namos has experience of implementing this functionality with organisations across a broad range of sectors, affording us the expertise to support your organisation in best utilising these features.

Attachment category enhancement in dispute creation

Select from the complete list of attachment categories when adding attachments to a dispute against a customer transaction.

When creating a dispute against a transaction using the Manage Disputes page, the user can select from the complete set of attachment categories that is also available in the Edit Transaction and Review Transaction pages.

  • The Create Dispute process now has access to all attachment categories associated with transactions, instead of only the one attachment category Customer Transaction.
  • Financial managers can control which job roles (for example, Collection Manager) can perform which actions (read, edit, or delete) on attachments that belong to an attachment category (for example, dispute or collection).

Additional data points for collections scoring

Collections has now provided additional data points at customer, account and site levels for collections scoring to improve collection efficiency.

  • Amount Past Due More Than 15 Days
  • Age of Latest Payment

Use these data points in your scoring formulas for a customer, customer account, or customer site.

Business benefits include:

  • This helps the collector to manage the collection resources and strategies in an effective way.
  • This helps determine the collectability of the customer, customer account, and customer site.

Collector update of invoice attributes and contacts in collections

It is now possible to update the purchase order information, user comments, line-level descriptions, and contact information on invoices using the Advanced Collections pages. This improves collection efficiency by letting collectors make these updates directly without recourse to Receivables.

The Advanced Collections pages include two additional updateable fields at the transaction line level to display comments and translated descriptions for improved efficiency.

Collector update of invoice attributes and contacts in collections

Credit score addition to collections customer profiles

You can now display credit-related information, such as a customer credit limit and credit rating, in the Collections pages to improve collections efficiency.

The Collections Customer Profile page includes the following credit information for each customer:

  • Credit Classification
  • Credit Rating
  • Credit Limit
  • Last Credit Review Date
  • Credit Hold
B2CM Customer

Business benefits include:

  • Provides access to current customer credit information.
  • Enhances collector analysis of delinquent customers to improve business decisions.

Namos Solutions have extensive experience of implementing Advanced Collections, both during an initial implementation and after go-live to level up an existing solution, so we are happy to help you work through all these considerations no matter where you are on your Oracle journey.