Treasury Management Internation Logo

Study Found that Only 7% of Companies Harness Predictive Analytics to Improve Working Capital

Published 

A recent study of global corporations conducted by SunGard revealed a significant lack in the utilization of risk models to accurately prioritize collections for improved working capital. Despite advancements in technology and risk modeling, only 7% of companies are harnessing predictive analytics. This means that 93% of companies rely on a decades-old practice of sorting by age and value to prioritize collections, rather than an automated risk score, according to the 2014 study – click here to download the study.

Statistical-based credit scoring models are designed to predict the inherent risk of a customer, including their probability of delinquency and likelihood of filing for bankruptcy. A company can “quantify risk” through automated scoring models that take into account the specific customer payment behavior with that company. This enables A/R departments to develop collections strategies according to a proven and quantifiable risk score, rather than age or value.

“By using risk and predictive analytics, companies can save time while improving their cash flow. The study shows that 93% of companies are still leaving money on the table,” states C.J. Wimley, chief operating officer of SunGard’s AvantGard Receivables business. “The companies using predictive analytics to target accounts stand to benefit from more effective collection efforts and lower past due receivables.”

The study included over 400 participants across more than 20 primary industries.

Most recent episodes

HSBC’s Sibos Spotlight: Investing in the Future – from Diversity to Green Deposits

In the final instalment of HSBC’s Sibos Spotlight, Eleanor Hill (TMI) invites Nadine Lagarmitte and Suraj Kalati (HSBC) to consider how corporates’ attitudes to...

25:12

HSBC’s Sibos Spotlight: The ESG Landscape – what every treasurer needs to know

In the third edition of HSBC’s Sibos Spotlight Podcast series, TMI’s Eleanor Hill invites Farnam Bidgoli (HSBC) to provide an in-depth overview of the current ESG...

16:24

The Path to Transformational Global Cash Visibility

Davina Bradley (CEVA Logistics) and Conor Deegan (CashAnalytics) join TMI’s Eleanor Hill to explore how treasurers can transform their cash visibility and forecasting within their business in a matter of weeks using a...

33:16

HSBC’s Sibos Spotlight: Embedding ESG in Trade and Supply Chains

In the second podcast from HSBC’s Sibos Spotlight series, TMI’s Eleanor Hill speaks to Surath Sengupta (HSBC) about embedding ESG into trade and supply chains....

20:58

Lost in Transaction: Overcoming Payments Pitfalls

From simple errors to duplicates, fraud and sanctions violations, there are a number of areas where payments can go wrong – especially in the real-time environment. In this podcast, TMI speaks to Andrew Ferrao...

34:25

HSBC's Sibos Spotlight: Central Bank Digital Currencies

The first edition of HSBC’s Sibos Spotlight series sees TMI’s Eleanor Hill joined by Mark Williamson and James Pomeroy (HSBC) to discuss the hot topic of Central Bank Digital Currencies (CBDCs). Our guests discuss...

25:48

Payments Vision 2025: The Inside Track

Wim Grosemans, Steven Lenaerts (BNP Paribas) and Wim Raymaekers (SWIFT) join TMI’s Eleanor Hill to outline their vision for the payments landscape in 2025. Our guests consider how recent developments such as instant...

28:21

Stepping Out from the Shadows

“Treasurers needs to step out of the shadows and into the sunshine in terms of their strategic contribution.” claims Zitah McMillan, Co-Founder and CEO, Predictive Black. In this podcast, hosted by TMI’s Eleanor Hill, our guest declares that the...

16:54

Why the ‘One Size Fits All’ Approach is Outdated - A Cash Segmentation Treasury Masterclass

With the ongoing low interest-rate environment and increasing regulatory change, it’s more important than ever for treasurers...

23:55

Instant Payments: Instant Rewards

TMI’s Eleanor Hill sits down in the virtual TreasuryCast studio with J.P. Morgan’s Global Head of Real-Time Payments, Cyrus Bhathawalla, to discuss how treasurers can capitalise on the evolving nature of real-time payments. Our guest contemplates the elements...

23:55