Advanced Customer Ranking techniques in modern ERP
- Feed the system with additional data that do not and cannot exist in a typical A/R system, like published Balance-sheet figures and indexes of the customer under evaluation (turnover, total accounts receivable, open loans from banks etc.)
- Additional data may also include objective or subjective views of the Company that concern the Customer, like ranking of the business relationship, so far (good, average, bad), reputation of the Customer in the local market etc.
- Having collected all the above data, a mechanism should be in place to examine each of them, one by one (and in combinations, if needed), to produce a final result such as a Customer Ranking Index (1-bad to 10-good) or characterization (1-Unreliable to 5-Reliable) or whatever ranking range the CFO sees fit.
- Up to this point, the Customer file has been “characterized” in a good-to-bad range. Now, this ranking can be used to make additional decisions for each customer. Decisions may include: