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#receivables October 25, 2016

Want to get more from your accounts receivable team? Try offering incentives. Many companies have successfully implemented the following three programs, typically on a quarterly basis.

Actual Collection Dollars

If you are looking for increasing the number of dollars collected, incentivize based on number of dollars collected. It gives your staff a number they can focus on every day or week. Simple, daily goals to focus on will keep your team motivated because they have some direct control over the amount of their bonus.


Target DSO

If your DSO needs help, consider offering bonuses for reducing your DSO for the next quarter. Set a target that’s reasonably lower. Goals that are too high tend to demoralize rather than motivate. For example, if your DSO is at 50 days, offer a bonus if your team is able to reduce it to 47 days. If you want to get really aggressive about it, offer more for stretch goals. Maybe additional compensation if DSO is lowered to 45, 44, and 43 days.

Maintaining DSO

Similar to the previous idea, except that your team has worked hard to reach a great DSO and should be rewarded for maintaining that standard of excellence.


Max Golovnia | Co-Founder & CTO

Armatic Technologies, Inc.

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