Your Company’s New Secret Weapon
Traditionally, manufacturers have devoted most of their time and resources to managing the physical supply chain without giving much attention to the financial one. But as costs continue to rise, managing your company’s cash and capital is just as vital to your success as handling relationships with your supply chain partners.
Luckily, you have a secret weapon in your back pocket—SAP Financial Supply Chain Management (FSCM). Read on to learn a bit more about financial supply chain management in general, the benefits of SAP FSCM in particular, and how to put that financial firepower to work for you.
What is Financial Supply Chain Management?
First things first, what is “financial supply chain management” precisely? FCSM is the practice of looking at your financial processes at the holistic level, as opposed to looking at each one individually. The entire process covers the procure-to-pay cycle, working capital management, and the order-to-cash cycle, including everything from ordering and invoicing to reconciliation and payment.
The goal of financial supply chain management is to gain visibility into the entire process so that you can make things more efficient (and save your company money). Of course, dealing with so many stakeholders and moving parts is a bit easier said than done. That’s why SAP’s FSCM module is so useful—it’s been designed to help you reduce this complexity and make your supply chain more efficient.
Overview of SAP Financial Supply Chain Management
SAP FSCM is a set of applications that can give you improved visibility and control of your accounts receivable by allowing you to manage customer-related financial functions, (including billing, receivables, collections, and risk assessment), all within your SAP ERP system.
The solution consists of several components, including:
This module allows customers and suppliers to access invoicing and payment information through your company’s business portal. Biller Direct provides seamless integration with your accounting system and lets you handle electronic payment and settlement processes with customers or suppliers.
The Collection Management app makes it easier to identify problem accounts, helping you to improve the productivity of your collections and increase collection rates.
Credit Management evaluates your customer’s creditworthiness using internal and external rating data, accelerating your credit managers’ ability to extend or reject customer credit limits.
The Dispute Management app gives your accounts receivable/debt department full transparency when it comes to customer invoicing and billing issues. It addresses disputes over receivables and provides monitoring that detects payment issues before they grow into massive headaches.
This app processes internal and external payment transactions, helping to reduce the number of bank accounts you must hold, as well as the volume of foreign payments that need to be made.
Treasury and Risk Management
Finally, the Treasury and Risk Management app makes it easier to manage payments, cash, risk, liquidity, and compliance. Making it even more useful, it’s also integrated with financial reporting.
Other Benefits of SAP FSCM
SAP FSCM gives you real-time insights into your company’s financials so that you can better manage your working capital and receivables to help reduce costs. By streamlining the overall management of the receivables-related process (not to mention a reduction in manual activities), the solution helps you save money by increasing efficiencies.
Additionally, SAP FSCM not only allows you to predict cash flow, but it can also help to reduce working capital and operating expenses by increasing the number of customer payments and reducing debtors.
If you’re ready to give your financial supply chain manager a bit more firepower, Surety Systems is here to help out. We know that SAP FSCM is a bit of a unique module, but it’s one our senior-level, US-based SAP consulting team has experience with. So if you’re in need of a partner to help you implement (or optimize) SAP FSCM in your organization, we’ve got you covered.
Contact us today to get started.