Peter Horadan, Co-Founder and CEO
A successful company is fueled by good decisions. Although every business decision has an impact on the company’s growth, one cannot deny that some of the most important business decisions are associated with the company’s financial details—especially accounting. In this regard, accounting is the lifeblood of any business and plays a critical role in deciding the company’s success or failure.
Driven by this understanding, while companies have been digitalizing and streamlining their critical internal accounting processes like collections, processing, and reporting, there is one challenge they are struggling to overcome—cross-business accounting workflows, including accounts payables and accounts receivables pertaining to vendors and customers.
For instance, take Acme Company and its IT vendor. The vendor has to send monthly invoices for the products and services procured by Acme Company. Even if both of these companies have their own robust internal accounting systems, those systems are not designed to share transactions between Acme Company and the IT vendor; the vendor ends up using the conventional means of manually emailing the PDF invoices.
Now, what if their accounting systems were connected (called connected accounting)? The systems would be able to freely exchange invoice and payment transactions without the need for manual intervention. Well, this is exactly what Lockstep®—a developer of next-gen financial and accounting software—brings to the table. The company’s robust Lockstep platform leverages its built-in API to connect the accounting systems of a company to their customers’ and vendors’ accounting systems over the cloud or through on-premise integrations, creating a unified, connected accounting data network that facilitates a free flow of data between the systems.
“Once the data-sharing pipeline is established, the trading partners can seamlessly access the relevant accounting data, including invoices, stored in their vendor’s and customer’s accounting system,” says Peter Horadan, co-founder and CEO of Lockstep. So, rather than accounting personnel relying on manual workflow to exchange and enter transactions using emails, the critical accounting transactions are automatically replicated in each system.
And when it comes to cross-business data sharing, Lockstep ensures that all the business-critical data is safe and secure. In fact, all exchange of transactions across the ‘connected accounting’ network is overseen by Lockstep’s certified technology and staff, which ensures data integrity and accuracy. The company also conducts frequent security audits, including customer-facing audit logs to determine the frequency of data access as well as the identity of users accessing the financial information so that clients can always have control over who accesses their data.
That being said, not all companies might wish to establish automated data sharing with their trading partners. “A more traditional business might be hesitant to open access to its accounting system,” mentions Horadan. “In such cases, we can provide them with complete email automation.
Once the data-sharing pipeline is established, the trading partners can seamlessly access the relevant accounting data, including invoices, stored in their vendor’s and customer’s accounting system
They can continue sending invoices through emails, but Lockstep eliminates the manual workflow.” However, if the company wishes to rid the back-and-forth of email attachments but still maintain their conventional workflow, they can choose a web portal for data sharing. Using this offering, the company can let their vendor or customers access through a permissioned view of specific accounting transactions, including invoices and payment.
Streamlining Cash Flow and Payments
While ‘connected accounting’ is the crown jewel offering of Lockstep, the company also offers a highly customizable AR Automation solution, Lockstep Receivables, specifically designed to streamline its clients’ cash flow and payment processes. Lockstep Receivables (formerly Anytime Collect) automates the accounts receivables processes of clients so they can get paid in a faster and simpler manner. In fact, the solution reduces the days sales outstanding (DSO)—or the average number of days taken to collect payment after completion of sales—by almost 30 percent.
Ushering Clients into the Era of Automation
Today, by leveraging Lockstep’s next-gen connected accounting solutions, many businesses have augmented their external accounting workflows. Recently, the company collaborated with a security monitoring service provider with over 20,000 clients. Every month, the provider had to send more than 4,500 invoices. So, the accounting personnel would gather and fold the paper invoices in envelopes, stamp them, and mail them out individually to their clients. That was until Lockstep came into the picture. Through AR automation, the company was able to collect contact email addresses for their 20,000 clients, digitalizing and automating the tedious workflow at the same time.
Owing to this, today, the service provider can rely on Lockstep’s solution to automatically send out the invoices to clients rather than sending them out manually. Going a step further, Lockstep also implemented web sharing, allowing the 20,000 clients to directly access the service provider’s accounting database and view the open and closed invoices, payments, and credit memos. As a result of these solutions, the security monitoring service provider has saved thousands of dollars a year, and it is still seeing a decrease of more than 22 percent in DSO.
The example above is but one of the many success stories that Lockstep has seen over the years. This has been possible not only because of its next-gen solutions but also the exceptional workforce at the company. The accounting specialists at Lockstep are always eager to elevate the accounting teams of its clients by providing them with the solutions and support their needs.
While such a culture would remain a linchpin of its success, the company also keeps itself relevant by pushing the bounds of its innovation. For starters, Lockstep is now recruiting development partners to build new functionalities on its platform and facilitate a one-stop-shop for all financial solutions, including supply chain financing, asset-based lending, loan origination, and so on. The company is also allowing third-party developers to develop solutions using its API platform and contribute to its growing accounting ecosystem. “We will continue helping our clients achieve a more wholesome digital transformation, while at the same time, proactively responding to emerging global demands for better accounting solutions,” concludes Horadan.