AR Period Reduction/Behavior

Now that we have some context for the situation it's appropriate to begin to investigate, though possibly not where you might think. And the investigation is actually a bit hindered because management fired the accounts receivables department. What I'm really interested in is trends as to how things have evolved over time. There is a also a video for this insight which is a component of the Effective Problem Solving Course.

Now that we have some context for the situation it's appropriate to begin to investigate, though possibly not where you might think. And the investigation is actually a bit hindered because management fired the accounts receivables department. What I'm really interested in is trends as to how things have evolved over time. There is a also a video for this insight which is a component of the Effective Problem Solving Course.
As the Accounts Receivable group has not been able to reduce the [Gap] between the [Desired Avg AR Period] and the [Current Avg AR Period] maybe it might be appropriate to do a bit more investigation.
A [Sale] to the [Customer] results in an [Order]. The [Order] results in a [Shipment] to the [Customer] followed by an [Invoice]. The [Invoice] adds to [Accounts Receivable] and when the [Customer] sends a [Payment] it reduces [Accounts Receivable].
It seems there are four trends that it makes sense to look at, [Avg Sales], [Avg Order Size], [Avg Order Period] and [Avg AR Period].
The trend lines indicate that the [Avg Sales] are declining though [Avg Order Size] is remaining relatively steady. Though the [Avg Order Period] and [Avg AR Period] are both increasing.
If you look at the [Percent Change] tab notice how much easier it is to tell how things are trending once you normalize them? With multiple trends lines all on different scales it's often difficult to get a real sense of what's happening.
So if this is how things are trending it's probably appropriate to try to figure out why.

View the model in Insight Maker