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Chapter 4
Billing Best Practices

This chapter covers the best practices that can be used to create a more efficient
billing operation. The best practices fall into three main categories. One group
covers the need for more accurate information that is used to create an invoice.
These items focus on the stream of information going from the shipping depart-
ment to the invoicing staff, with a particular emphasis on rooting out any missing
or incorrect information. The next group of best practices covers the efficiency of
the invoicing operation itself, eliminating month-end statements and using a
smaller number of multipart invoice forms. The final group focuses on changing
the method of invoice delivery to the customer, such as using electronic data
interchange or allowing the delivery person to create the invoice at the point of
delivery. When taken as a whole, these best practices result in an invoicing opera-
tion that is remarkably error-free, issues invoices as soon as products are shipped,
and ensures that customers receive invoices almost at once.

IMPLEMENTATION ISSUES FOR BILLING BEST PRACTICES

The best practices in this chapter comprise a broad mix of issues that are easily
put in place and others that are much more challenging to implement, depending
on a company’s specific circumstances. This section contains a table (Exhibit 4.1)
that lists the best practices and then describes the cost and duration of implemen-
tation for each one. The most difficult ones are those that require extra computer
programming to achieve, as well as those that require the cooperative efforts of
other departments. The easiest ones can generally be achieved within the account-
ing department and with no additional capital or personnel costs of note. The
implementation issues for billing best practices are as follows.
Some of the most difficult implementation jobs result in the greatest improve-
ments in the performance of the billing function. Accordingly, it is best to alter-
nate easy implementations with more difficult ones so that there is a constant
stream of successes, some of which represent significant advances in efficiency.
Also, by including an occasional ‘‘quick-hit” implementation, a controller can
point toward a continuing stream of successes, which is useful when trying to
obtain funds for more best practices–related projects.
The remainder of this chapter describes the best practices that were itemized
in Exhibit 4.1. Each description includes the benefits and problems associated

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