Billing and Payment Systems

Billing and Payment Systems

Introduction

Billing and payment systems in any business are important. The Precision Electronic Parts billing and payment systems are overworked and the invoice systems are behind scheduled due to the huge increase in orders and increased production as well. It is important that the company develops systems that can handle the new magnitude of work. The business administration group in the company initiated the investigation in a bid to keep up with the growth rate of the company. The investigation was thus carried out by Mark Temple who is the Chief Information Officer of PEP. The billing and payment systems needs to be upgraded to fit the demands of the expanding business.

Discussion

The basis of the problem to be solved is concerned with billing systems and keeping records of inventories. This is a problem that has been brought about by rapid expansion of the company in production and catering more to wider markets. This is further made possible by the production of cheaper and more affordable commodities. Ultimately, the inventory systems need to be upgraded in a way that all the orders placed will reflect to all the relevant departments within the company. The strides taken by the IT department have ensured the company takes an upward trajectory in design, productions and sales efficiency. The production systems of the company are supposed to work hand in hand with the stock taking process. A good inventory system is important for the company to progress profitably. The company has an opportunity of doubling profits and sales. This is only possible to achieve when the orders placed can be reached and processed as soon as they are made. Secondly, progress in the company will be stalled if the sales and inventories department cannot keep up with the demand. 

The proposed system is an in house system based on Microsoft access. This is controlled by the IT department and can easily be updated with information from invoices and accounts receivable departments. This essentially means that the stocks of the company are easily and accurately monitored. The sales department is now required to use invoicing to register new clients. This is important because in the long run, the client records can be kept, monitored and easily made available when there is need for a review on the performance of the client. These records are important in evaluating the credit-worthiness of a client when they make an order for an expensive item. The problem being with the billing and payment systems, they are adjusted without much interference in other departments when the Microsoft program is used. It is a cheap and efficient system to use in an organization with diverse operations like Precision Electronic Parts. It is a system that is easy to use and the same time, keeps date secure.

The constraints of making the upgrade are mainly financial. This is because the projects had not been included in the budget for the upgrade. The invoicing department has been updating their records once a month. This is something that the company need to address in order to process orders faster and bill their clients in time. The finances in the company need to be centralized. This is one of the major constraints that the company has to contend with. The company management has to be more receptive of change and embrace new technology when appropriate. The billing and payment system is an important department in any company. This means that the manager who is reluctant to approve of technology needs to made aware of the risks the company faces by not having a better billing and payment system. The centralized payment system needs to be implemented and spearheaded by the management to ensure that it is a success in the long run. The management can be the biggest constraint to progress in the company after financial challenges. The reluctance by the management can be a major hindrance even when the money is made available. The constraints, therefore, include; financial, technical and organizational constraints. These are all constraints that can be overcome in order to keep up with the technology of the current times.

The finances of the company are handled in many different departments. This is likely to leave loopholes for losses or proper records not being kept. It is important that the financial affairs of the company are centralized. For instance; there is a finance department which is not the same one that handles the sales and payment records. The current state of the financial department needs to be put together under one manager. He manager can then have assistants to help manage the financial affairs of the company. The payments and the expenditures should be monitored in one department to ensure that when it is time to put together a financial report, it is compiled by one department all together. 

The company has a good billing policy as it is. This is important for ensuring that the company keeps track of all its successful sales. Tracking sales means that the profits are nor overstated. It ensures that the company can also make decisions of discounts. This is based on the data the company has on the clients. The billing system also means that the company always gives clients value for their money and at the same time generates profits for the company. The billing means clients get their invoices in time (Leis, 2017). This in the long run helps the company in their expansion plans and seamless operations.

The costs of the current system are not easy to determine because of the expansive financial department. There are many ways of evaluating the cost of the current system. The easiest way to determine this cost is to evaluate the cost of the equipment being used in the current system. This will make the evaluation process easy to complete. This can only be done by the staff members of the billing and payment systems.

Feasibility Analysis

Technical feasibility of maintaining a Microsoft Access systems to manage their inventories. Ultimately, the system will rescue the backlog of records in the inventory systems. This means that the company can easily be implemented without interfering with the rest of the company’s systems of production. Setting the billing systems straight n the company will ensure that the company management can easily track the growth and expansion of the company. The technical feasibility of establishing the billing and payment systems is positive. The ability of the company to support a technical system for the company’s billing and payment procedures is strong.

The development of a system supported by Microsoft system is financially feasible. The company only needs an IT expert to have the system up and running. The financial feasibility is therefore validated. The company can easily keep track of the client’s payment records. This way, the invoicing department can easily identify the clients who default on payments. The same invoicing department can easily be used to offer discounts to loyal clients. Implementing the new systems will save the company more money and ensure that business deals are closed faster and more profitably.

The behavior of the organization can also be used to determine the feasibility of upgrading systems in the billing and payment departments (Jewel, 2015). There is a challenge where there are certain managers who are reluctant to adapt new systems unless they are convinced beyond any doubt that the new systems are legitimate. It is important to be cautious but sometimes too much caution slows down the development of a company. Therefore, the organizational feasibility of upgrading company systems is critical to the success of the company. 

Recommendation

The project is likely to take a year to fully implement. This is because in one year, clients will have laced orders severally and the client records can be evaluated. In one year, a financial year can be closed as well. In essence, this is enough time to monitor the performance of the company and notice the changes after the system is implemented. The estimated cost can be calculated from the size of assets that the company has. From this, the company can be advised by the IT department to see what the equipment to be used to implement the upgrade will cost. This will then be vetted by the management who will determine whether the amount is worth the type of work that it is being implemented for. The first six months of the system upgrade will be used to implement and the additional six will be used for monitoring how well it works.

The system upgrade is expected to benefit the company with better sales recorded (RedPayments, 2017). The sales will increase because the orders will be processed faster. The system will also ensure that the bad debt cases are reduced gradually. This will be done by having clients’ records. The records are important to enable the company to know which clients are likely to default on payments and this ways the financial department knows how to handle their cases. Expanding the client base is also important and viable by upgrading the billing and payment systems. The company will benefit from this changes by ensuring the company accounts always close with a profit. The quantifiable changes are noted in the profits and general client feedback on services offered. Client feedback could come in form of client referrals and this translates to more sales. The tangible benefits, therefore, include; Profits, less bad debt cases and an upsurge in client traffic indicated by an increase in orders by new clients.

The intangible benefits are not monetary. These are benefits like the employees being more satisfied with their work load. This is indicated by the employees having more time to deal with the clients. The records of the production, sales and payments are better kept. The employees having a happy work environment free from the general exhaustion of using manual invoicing and payment processing sheets will also encourage workers to perform better. Therefore, the intangible benefits include; better work conditions, satisfied customers and ultimately good company reviews by clients.

References

Jewel, J. R. (2015, August 14). Constrcuction Executive. Retrieved from enewsletters.constructionexec.com/managingyourbusiness/2015/08/how-to-improve-billing-and-ensure-timely-collections/

Leis, M. (2017, January 17). 10 Easy Steps to Improve Your Billing Porcess Right Now. Retrieved from Work Mangement: www.scoro.com/blog/steps-for-improving-billing-process

RedPayments. (2017, October 08). Importance of Having an Effective Billing System for Your Business. Retrieved from RedPayments: repayments.net/14/effective-billing-system-for-your-business