Contract management is one of the most essential processes of any leasing/asset finance business. It is a critical component of your every customer journey, and the process where your teams spend a significant part of the team behind.
A good servicing portfolio ensures the following benefits for any asset finance business:
- Maintains a steady revenue stream for service providers by streamlining invoicing, payments, and customer notifications.
- Ensures compliance with contracts and reduces risk.
- Meets customers' service needs and expectations consistently.
- Engages customers with better services to improve customer loyalty, retention, and upgrades.
- Maintains and strengthens relationships with customers.
Lease servicing 101
Do your accounts payables (AP) and receivables (AR) teams spend hundreds of hours every month manually capturing invoice data and matching or reconciling it to contract information?
Errors will occur, and processing time can vary depending on the size of the team. In addition, you may face hefty penalties if you miss a payment date. You may end up increasing your chances of incurring bad debts from customers if you fail to receive their payments on time.
A growing company will inevitably have to deal with increasingly complex contracts, which quickly become another labor-intensive endeavor. Key business processes like contract management, billing/collections, document management, asset management, and accounts payable when handled manually can increase the risk of errors due to human mistakes, delays, and overall process sluggishness.
Great asset leasing software can help you optimize key business processes by automating most of the processes like invoicing, contract management, account payables, funding/syndication etc. For example, an end-to-end integrated asset management platform helps you extract key information from orders or contracts, generate invoices, update the accounts payable/receivable system, and process them.
With robotic process automation (RPA) and artificial intelligence (AI), invoice processing automation facilitates touchless processing and improved end-to-end AP/AR workflows. Now you can effortlessly create, manage, store, and renew legal documents. Furthermore, you can automate the approval process, incorporate digital signatures, and improve contract terms and conditions. It is best to have both the legal and commercial teams be able to self-serve routine contract documents.
Best practices to build a winning servicing strategy
Standardize building of contracts: Get an asset finance platform that can help you to templatize contracts. It will enable you to expedite the contract management process, but make sure you consult with your legal team before making changes to templates.
Automate invoicing: Reconciling invoices can be accomplished automatically and manually. During the automatic reconciliation phase, invoices are matched to orders and contracts within tolerances defined in your configuration, and unresolved issues are referred to users for manual reconciliation. In the absence of exceptions, the automatic reconciliation process will still produce the invoice reconciliation document, which must be approved according to the IR approval rules for your site.
Manual or automatic reconciliations are approved according to approval rules in your organization.
Establish transparent goals for your entire organization: Establish KPIs (Key Performance Indicators) for measuring departmental success.
Keep track of the approval time for contracts: By keeping an eye on the time and learning your contract management process whenever possible, you can lead to a more positive working relationship with customers.
Establish transparent company goals: To achieve revenue or performance goals, make sure everyone is aware of them. Your dispatchers and technicians must be able to gauge their success based on the key performance indicators you have defined and communicated clearly.
Maintain regulatory compliance regularly: Maintain compliance with industry, state, and federal regulations by periodically reviewing your contracts. An asset management platform with the right servicing capabilities can automate this process for you, by handling tasks like amendments, non-accrual, provisions, usage-based billing, etc.
Make contracts accessible to customers and third-party partners through self-service portals: Equip your customer-facing workforce with mobile devices that can access a central repository that stores all contract information in digital form for easy access that they can use to pull up to be able to easily answer customers’ contract-related questions and resolve minor disputes on the job. Alternatively find a technology partner that can help you with self-service portals for your customers and partners that will help you to provide them access to their contracts and documents, anytime, anywhere- on a device and platform of their choice.
Streamline the contract management process: A simplified contract management process can be achieved by automating key components of the process. With automation, you also notify your customers when their contract is about to expire, eliminating anxiety for your customers.
Invest in asset leasing software: You can build a secure, centralized digital repository to store important contacts and other relevant data by using a contract management system, which provides mobility and automation. It is even possible to assign contract approval roles to individuals or teams through your contract management system, thereby eliminating contract management bottlenecks.
The modern asset finance business needs to respond quickly to incoming work orders, be creative and efficient in administering repairs, and be dedicated to its customers to be successful. Even without considering servicing and customer service complexity, that is a tall order.
Fortunately, the Odessa platform is the ideal solution to help simplify the key components of lease/loan servicing like contract management, invoicing, billing/collections, etc. The servicing module of the Odessa Platform provides the same functionality as a more complex system without its complexity or cost. A centralized digital repository and built-in templates create a seamless integration between the service module and your existing systems, enabling you to gain better visibility and control over your contracts. In addition, Odessa's agile service delivery makes implementation simple.
The Odessa Platform is end-to-end asset leasing software, that delivers comprehensive functionality that enables self-service, automation, and business agility. Odessa’s platform philosophy means reduced cost and complexity associated with traditional upgrades and legacy providers – by delivering 4x annual platform releases, customers can easily adapt, go to the market faster with new products, and remain nimble.
Headquartered in Philadelphia, USA, Odessa is the largest leasing-focused technology company in the world. With a highly specialized team of professionals across North America, Europe, and Asia Pacific, Odessa has a 2-decade track record of excellence in providing industry-leading Asset leasing technology.