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Functional insolvency

18th Apr 2016
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Whenever the 'fax' springs in to life (it is actually part of our large multifunction copier) - we all laugh, and say that 1984 is calling. During my working life I have seen the fax arrive (thermally), mature (laser printers) and then die. If I am honest, I think the postal service is going the same way.

My recent Aweb question about franking machines garnered a general response of 'why would you even go there' - even though we did in the end choose to keep a franking machine, together with a daily office collection.

Our local postie now collects at 3:30 rather than 4:30. I think that is down to falling volumes. He will soon (I imagine) be the person delivering the mail in mid morning and collecting mid afternoon. Not too long ago there would have been delivery and collection post (wo)men, and never the twain shall meet.

So, there is technological change all around, and older routines are fading away - yet, how much of the average finance team's life is currently spent managing debtors and creditors?

We expect our invoices to arrive via email, and we tend to send them out via email - together with remittance advices, and BACS files for payment. It really cannot be that long until we work out ways of joining the whole thing together.

Now - I am sure if you supply Tesco, Honda or the like, you already have to work this way - but I am talking about the trickle down effect so that it reaches SME world.

Of course, this could lead to a reduction in employment in our sector, which is not something I would really want - I have worked with some great people over the years. Or, we could use the other argument, and say that if you take out drudgery you free people up to do more interesting and higher value work.

In the end, though, I expect this won't really happen because of the amount of free funding that floats about managing these ledgers. My suppliers tend to get paid on average in 45 days. I struggle to bring payments in much quicker than 55 days. This probably reflects my respective market positions both as customer and supplier. I have a broad range of customers and suppliers though, so I have got some flexibility.

Still, that means I am providing a good 10 days of free credit somewhere along the line.

When you add that up all the way along the supply chain I am sure the total will dwarf the banks lending - and all for free.

So, I expect my dream of all the computers speaking to each other in some giant chain, with money passing up the line, is probably still a dream for now.

They do say you should be careful what you wish for - I do need a reason for someone to pay me to go to work after all.


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By kalaika
20th Apr 2016 13:02

The fax is a funny one.  The

The fax is a funny one.  The only entities that I find I have to use the fax for these days are banks.  Two (paraphrased) conversations I have had recently: 


Me: "Can I amend one of our credit cards?"

Bank: "Yes, just fax or post us signed instructions"

Me: "Can I sign a letter, scan and email it?"

Bank: "No. Must be a fax or by post."


Me: "Can you send me confirmation of the SWIFT transfer?"

Bank: "Yes, I'll post it to you."

Me: "Can you email it to me?"

Bank: "No. But I can fax it to you."


For today's world with instant communication via email or online banking, I find the insistance on faxes or snail mail odd.  I appreciate the banks have to worry about data protection to make sure sensitive info, instructions, etc, come from or go to the correct person, but surely there is a better way than relying on faxes?

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By margaretrmartin
23rd Apr 2016 11:56

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By dsummerbell
01st Jun 2016 22:51

Technology is indeed changing the way many of us do business. Fortunately, there are some things that technology will never be able to replace, like human intuition. I really enjoyed reading your article and look forward to reading many more quality pieces like this on this site. Thanks for sharing.

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By sandrasparks
28th Oct 2016 18:12

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By MattWalters
03rd Mar 2017 11:24

It's impossible to ignore all the technological changes and not implement them in your business. Especially when it makes your life easier e.g. why should I bother with all these papers when I can write my essay online and save both time and resources?

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By debradeb
12th May 2017 07:39

There are many alternative ways the postal service can work. They should focus on something else other than this normal mails. I don’t think they have another option to keep it going. Who uses postal service to send mails now? oren loni burgerim

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