Becoming a digital first organization: Streamlining the Order-to-Cash

process

O2C meets digitization

If you don’t know already, the order-to-cash (O2C) process is critical to any company. In fact, O2C is
often a definitive part of success because it not only impacts better customer relationships, but
improves payments, resource handling, and overall business management.

According to Hackett group’s 2020 working capital study, the average Days Sales Outstanding (DSO)
for businesses is at its highest point in the past 10 years, with an estimated $1.2 trillion stuck in
working capital alone.

What does this imply? Decision makers are realizing that automating only minute paper-based
processes isn’t going to push your digitization where it needs to be. This is where O2C automation
comes in, giving companies a holistic approach to digitization.

O2C automation has allowed companies to reduce shipping errors, increase efficiency, fasten
Accounts Receivable activities, facilitate payment cycles, and give more transparency into buyer
transactions altogether. Let’s take a closer look and see how automation can enhance this process.

O2C automation with RPA

The Order-to-Cash cycle primarily headlines these critical aspects:

Onboarding customers and credit management

This includes sending quotations or proposals to potential buyers. It can also extend to negotiations
to arrive at a favorable understanding for both buyer and seller. Customer onboarding can include
necessary credit management as well, to ensure each account is appropriately managed.

Customers today expect digitally enhanced experiences which can affect the customer’s willingness
to maintain a long-term relationship. According to a study, returning customers spend 67% more than
new customers while making a recurring purchase. Fortunately, managing consumer data is a lot
easier when done in order management systems. Here, onboarding becomes systematic. This in turn
lets you categorize data more efficiently to reduce the hassle of processing customer orders and credit
management.

Purchase order and sales order handling

,An order is officially placed when a buyer submits a purchase order (PO) procuring the products or
services offered. A sales order gets created as a response to the purchase order, which is generally an
internal reference document. In summary, documentation plays an important part in accountability
and compliance.

Manual data processing is in itself a slow process which. Any errors that arise can lead to twice as
many delays for existing orders. With RPA, the entire PO to SO process can be automated to eliminate
the need for manual data entry or document creation at any point. As a result, you have minimal wait
times, increased data accuracy, and an efficient document management procedure that makes
compliance easier.

To learn more, read our blog post read our blog on purchase order to sales order processing.
Shipping and invoicing
Next, products are shipped and delivered to the buyer along with relevant shipping and delivery
documents, such as Advance Shipping Notices (ASNs) and delivery notes. The completion of the
delivery is marked with an invoice, which reconciles the purchase demanded, with the goods and
services that were delivered.

As you might imagine, this invoice is an essential document for both the buyer and seller. Digital
invoicing uses automation to make invoice processing easier especially for the Accounts Receivable
department. An automated trigger processes the invoice right on time soon after delivery, clearing
quicker payments thereafter.

Apart from invoicing, all delivery-related documents can be updated to the buyer’s warehouse system
automatically, reducing wait times and improving inventory management. With real-time
acknowledgements using technology like electronic signatures, updates can be entered into the ERP
system directly and instantly. The process no longer requires human intervention.

Payments and customer retention

The O2C cycle doesn’t end with payments, but instead resets. At this point, it’s up to the vendor to
maintain a healthy long-term relationship with the buyer. This can be done through better customer
support, competitive pricing, and faster deliveries.

When the entire O2C cycle is optimized, payments subsequently take less time. The benefits of this
include leads better allocation of resources and shorter cycle durations.

What does Symtrax offer?

O2C boils down to two important factors. Each of these relies heavily relies on the other to , and
completely influences the outcome of the O2C process.

• Order Management overlooks everything from onboarding to order creation and shipping.
• Accounts Receivable starts from invoice processing and ends at payment collection. Its
primary role of is to reduce the DSO as much as possible.

Problems arise when there’s no coherency between these two critical parts of the process. Although
siloing can create friction between the two, they both need to work together.

If poor data management and input errors aren’t caught early on, they can lead to tremendous order
fulfillment delays . One thing leads to another: payments become unpredictable, the vendor-buyer
relationship suffers, and DSO increases hampering hampers cash flow.

No one wants that.

Symtrax offers Compleo Hybrid, an AI-driven digitization software that focuses on business
optimization.

• With certified connectors, all data is captured directly from your ERP/billing systems without
disrupting your existing O2C setup.
• Comprehensive data handling and storage makes referencing and retrieval faster. You can
access documents from anywhere, at any time, and share them easily with all stakeholders.
 • Real-time acknowledgments of order, shipping, and delivery documents help facilitate the
entire process without delays.

Because of this:

• All documents are processed automatically, including quotations, purchase orders, sales
orders, delivery notes, and invoices. None of these require manual input at any point during
this workflow.
• Document and product delivery is more accurate, improving customer satisfaction, retention,
and brand value.
• All formats are compatible with global EDI requirements to accommodate information
exchange. This ensures both external and internal compliance.
• DSO is reduced.

Check out our Order to Cash solution.

Measuring digital success from O2C automation

After successful O2C implementation, certain parameters that can be quantified and compared to
determine the proper scale for future digitization.

• Time and cost: Unsurprisingly, these are often the most essential resources for any company
and the first considerations after implementation.
• Productivity: How much more productive is the entire process? Are you making better use of
manual labor now that it’s not held up by repetitive tasks?
• Analytics: Digitization can help visualize accurate data, catalyzing better decision making.
• Partner relationships: Are they better now than before?
• ROI: How quickly can you realize revenues and allocate resources?

What’s next?
The other side of O2C is the procure to pay (P2P) cycle that can further your efforts in becoming a
digital organization. There’s a lot of similarities, but a whole lot more that’s different.

But more on that later. For now, you can read our ebook for more information on P2P essentials.