Inspired by the growth and ambiguity in the Accounts Receivable department, this Guidebook is designed to analyze the vast AR Automation landscape and offer strategic insights to accelerate the Finance department. These advancements are equipping CFOs to better visualize, manage their company’s capital while maintaining strong customer relationships. From order-to-cash solutions driving faster cash posting, to risk mitigation by reducing past due collections, AR department Automation represents a future of aligned business, finance, and technology execution.
The Accounts Receivable Process or Order-to-Cash (O2C) is perhaps the most fundamental objective for businesses that sell goods and services directly to consumers. O2C indicates whether the business is maintaining enough operational capital while addressing customer needs. Organizations on top of consumer loyalty realize that complying with deadlines for deliveries and streamlining time on the production line are essential to achieving success.
In today’s ever-growing digital economy, a smooth and efficient Order-to-Cash process covers every step from purchase to delivery. The more fine-tuned this process is, the easier an organization can maintain compliance, increase sales without overstretching capacity, monitor inventory accurately and quickly, and have agility in cash flow.
However, outdated business processes and legacy systems can make optimizing O2C challenging. End-to-end integration needs to include a common focus and system to be successful. Companies using outdated or separate cash management procedures lack the needed visibility to optimize the O2C process. Ultimately, this results in limited control over information transfer mistakes and breakdowns.
Inadequate integration creates an uphill battle for the customer support and sales teams to collaborate towards solving problems. One of the most serious issues is a lack of synchronization with cash management and order management procedures. Some businesses struggle with integration due to a lack of automated systems. Companies that rely on manually handling customer orders often result in a higher error rate and additional processing costs.
It’s important to watch for signs of an inefficient O2C process as they can obstruct organizational transformation. The full AR Automation Guidebook dives deep into 9 Warning Signs of an Inefficient Order-to-Cash Process which include:
- No Standard For Exchange-to-exchange In
- OTC Process
- Using Several ERP Systems
- Delivery Fulfillment Problems
- Too Many Errors In Order Taking
- Master Data Problems
- Too Many Manual Entries
- High Number Of Days Sales Outstanding (DSO)
- Inadequate KPI’s
- Missing Controls
Individual processing KPIs, such as E2E processing and O2C E2E KPIs, must be measured and tracked by companies. Other KPIs, such as average days overdue, on-time delivery results, days sales outstanding, and perfect order performance, are also useful to monitor. These metrics provide a more comprehensive picture of a company’s success in all of its activities.
Recent studies demonstrate a majority of companies are looking to transform their O2C operations and there are numerous tools to decide between. According to a recent poll, 84% of businesses believe that investing in AI will give them competitive advantages, while 63% believe AI will help to minimize costs in the future.
AI and Machine Learning as a part of a Robotic Process Automation (RPA) solution can streamline a number of O2C Pain-Points covered in the full AR Automation Guidebook including:
- Order Processing
- Dispute Resolution
- Invoicing
Automation is an excellent way to reduce costs and errors while also improving performance, integration, and standardization. Order management transactions provide excellent opportunities for automation.
O2C automation is also a great way to boost scalability by allowing your employees to work on value-added activities instead of redundant tasks. All of this scalability makes it much easier to optimize O2C by increasing visibility and eliminating process silos.
Companies need to learn how to fully unleash the potential of using humans and machines to develop a seamless experience with customers. In addition, an O2C Platform that operates in the cloud, will streamline access and reduce costs. As such it is critical for an O2C platform to be cloud-based, rather than on-premise. Using this approach is much preferable compared to attempting to deploy various systems for each activity or subprocess.
Integration is essential to overcoming complexity, as a platform needs to incorporate new technology to best meet the needs of each client. Companies also need to use open-source technology that can easily be accessed by web services and APIs.
3 Goals of Optimizing your O2C Digital Process:
- Minimize the Process Cost Per Order
- Decrease the Number of Days Sales Outstanding
- Improve Customer Satisfaction
To Future-Proof your O2C Process, consider prioritizing these areas:
Strategy: strengthening your supply chain to mitigate risk while keeping variable costs down is
crucial in developing an O2C strategy.
Quote-to-Order: simplifying product offerings and negotiating with suppliers for better terms is
important for your quote-to-order.
Order-to-Invoice: transitioning to electric channels is key to minimizing manual order entries.
Invoice-to-Cash: Establish cash targets for receiving collections by creating a team and individual goals.
Architecture: Reducing secondary warehousing and noncritical reporting is one way to boost
efficiency.
Integration: A platform needs to synchronize with internal and external tech solutions as well as across departments. Integration makes it possible to create an ecosystem without boundaries to optimize performance.
Customer-Centricity: An O2C platform also needs to be focused on emerging technologies, scalable processing, and customers.
Shared Responsibility: Numerous activities need to work together on a platform, as it is important to know who is responsible for these functions.
Appoint a Process Owner: A process owner can look at ways to make improvements and ensure everything is working at an efficient level.
This exclusive Accounts Receivable (AR) Automation Guidebook uncovers how investing in an O2C platform for your company has many advantages, including increased efficiency and the ability to better meet the needs of each customer. AI and machine learning are also crucial in automating a variety of activities in the workplace. Embracing innovative solutions will help you cut costs while allowing employees to redistribute their time and energy.
This exclusive Accounts Receivable Automation Guidebook addresses these best practices in more detail and advises how to stay aware of this growing market and associated benefits.
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For a bonus on this topic and a collection of short, to-the-point discussions led by industry experts, Accounts Receivable Automation Strategies is now available free and on-demand.
