Heroes of AR: How AR Leaders Can Drive Strategic Growth by Preventing Revenue Leaks

Accounts Receivable (AR) has always been critical but historically underserved, and misunderstood. Often seen as a back-office function, the mindset of finance teams has always been “Send the invoice, get the payment”.

Yet; the AR function has been the quiet guardian of cash - doing it manually, yet not necessarily strategically. Today, in a climate of economic uncertainty, tighter budgets, and complex billing environments; AR has evolved into a strategic growth lever.

Our thought leadership series, Heroes of AR, celebrates the professionals who are redefining AR’s role in modern corporate finance. These leaders combine operational rigor with strategic foresight, while using automation and AI as an enhancer to help their businesses stop revenue leaks, improve cash predictability, and elevate AR from a transactional function to boardroom strategy influencer.

In the first part of Episode 2, Pradyut Hande, Head of Product Marketing at Growfin, speaks with Sarah McCauley, Founder of Effitech Solutions, and a 17 year AR champion who has scaled the function at high-growth companies like Gitlab, InVision, and Changepoint. Known globally as the “Original Revenue Storyteller”, Sarah helps SMBs and enterprises uncover cash flow inefficiencies, transform AR into a growth engine, and plan for the future.

The Evolution of AR: From “Invoice Collectors” to “Strategic Partners”

PH: You have spent 17 years in AR, starting as a specialist and eventually leading operations at global SaaS companies. How has AR changed during this time?

SM: I actually didn’t get into AR right away. I began in Accounts Payable (AP) and office management in the automotive industry, and then in construction and distribution. That’s where the beginning of my career was.

As I moved into this space, opportunities in AR began to emerge; opportunities that didn’t exist earlier. This shows that businesses were starting to think more strategically.

In terms of where AR has come from and where it’s going: AR was largely seen as “send the email, get the payment.” That’s a very weak and outdated outlook, especially given the volume of data available in AR portfolios. It used to be oversimplified: get the invoice paid, apply the cash, and move on.

With AR becoming more strategic, more roles have emerged beyond the manager level. For many years, “Manager” was the peak role in AR and credit.

However, one thing that hasn’t changed is that AR is still misunderstood and oversimplified. Teams are still expected to do more with less, and expectations have increased. They are collecting, applying cash, reconciling, managing disputes, and more.

What has changed is the tech explosion. Fifteen to twenty years ago, there were no tools for AR. Now, we have more efficient tools and elevated roles like Senior Manager, Director, VP, and Head of Collections.

TL;DR

- AR is no longer just invoice-chasing. It has evolved into a strategic growth function

- Modern AR leaders do more than collections. They apply cash, reconcile accounts, resolve disputes, and shape cash flow strategies

- Automation and data-rich AR portfolios are creating new leadership opportunities and redefining career paths

- Legacy mindsets still hold teams back, preventing them from realizing AR’s full strategic potential

Beyond DSO: Measuring What Truly Matters

PH: What KPIs were you responsible for at GitLab in terms of improving cash flow and operational efficiency?

SM: One of the gold standard metrics in AR is Days Sales Outstanding (DSO). It is the common measure of success in collections, and I’ve inherited it at many companies. But; my issue with DSO is that it is a lagging metric and doesn’t tell the full story. It doesn’t account for sales timing, cash sales, or the work the team puts in. It can hide performance, especially if there is a spike in bookings at the end of a month.

I prefer to paint a bigger picture by using DSO alongside:

• Average Days Collected (ADC)
• Average Days Delinquent (ADD)
• Collection Effectiveness Index (CEI)

I also look at billing as a percentage of bookings and collections as a percentage of billing. You cannot collect what you do not bill. These KPIs together give leadership better insights instead of relying only on DSO.

TL;DR:

- DSO alone can mislead. It’s only part of the cash flow story

- Pair it with CEI, average days collected, and collection-to-billing ratios for a 360° view

- These metrics reveal true performance in turning bookings into cash in the bank.

Building AR Systems That Scale

PH: What key AR transformation projects did you lead at GitLab?

SM: GitLab was in hypergrowth, moving from pre-IPO to post-IPO. The priority was to build efficiency before invoices were generated. Volume is always a problem in SaaS, so preparation is key.

I always start by getting a baseline - looking back 24 months to analyze bookings, billings, and collections. Cohort reporting helps establish benchmarks to identify areas that impact efficiency.

Key changes I implemented:

• Switching from one-to-one to batch-based billing for daily reconciliations and accuracy
• Ensuring invoices were reviewed and corrected before sending to customers in order to reduce disputes
• Implementing AR automation tools to scale efficiently without adding unnecessary headcount

However, I always stress that automation without understanding the process just creates chaos faster. You must know what problem you are solving before investing in tools.

TL;DR: - Start with a baseline: know your booking, billing, and collection performance

- Fix inefficiencies first before you scale collections operations

- Automation works best when it solves the right problem, not speeds up the wrong one

AI in AR: Hype vs. Real Impact

PH: How do you advise clients on separating AI hype from real impact in AR?

SM: AI is not the strategy. It is a support tool. Before buying into AI, businesses must know the outcomes they want. Whether it is better visibility, faster prioritization, or handling high-volume AR.

AI can:

• Analyze customer payment behaviors at scale
• Automate payment reconciliation and application
• Predict delinquencies and prioritize personalized outreach

But; human connection remains vital. Money conversations are sensitive, and removing human interaction entirely can harm relationships. AI should augment AR teams, not replace them. All with the objective of freeing AR professionals to focus on more strategic work that moves the needle beyond mere collections.

TL;DR: - AI boosts efficiency by automating repetitive manual AR tasks.

- Human touch matters in financial conversations and relationship building

- Leverage insights from AI to focus on long-term strategy and value creation

5 Strategic Takeaways

1. AR is evolving from a back-office role to a strategic growth driver
   
2. DSO alone is insufficient. Use CEI, delinquency metrics, and collection ratios for better insights - and the complete picture
   
3. Efficiency begins before invoicing. Fix billing issues and establish baselines first
   
4. Avoid adopting automation or AI technology due to the hype. Define the problem, outline the outcomes; and only then invest in the right solution
   
5. AI augments AR teams, enabling two to three times more efficiency while letting professionals focus on strategy.