Cash Application Performance Metrics 101: How to Measure Cash Application Automation
There are plenty of questions regarding the measurement of cash application automation. Many are confused because each vendor uses their own automation cash application performance metrics to paint their products in a good light. Unfortunately, many of these metrics fail to provide a clear picture of the automation’s effectiveness.
One metric that commonly and constantly comes up is the percentage of invoices the ERP or the accounting system successfully closed using the cash application solution, or what is more known as the kill rate. This metric, however, fails to measure the automation as it instead evaluates accuracy. This means that the kill rate only offers a partial picture since it puts together both the manual and automated parts that analysts do to correct exceptions and deal with non-automated payments.
Anyone searching for insights regarding how much more efficient or how much the firm is saving because of automation is better off looking at other metrics rather than rely on the kill rate or the ones provided by vendors.