WHITE PAPER REVOLUTIONIZE YOUR O2C CYCLE HOW CFOS CAN REDUCE THEIR ORDER TO CASH CYCLE TIMES BY 30%-40% WITH A SMART ORDER-TO-CASH FACTORY

Transcription

1 REVOLUTIONIZE YOUR O2C CYCLE HOW CFOS CAN REDUCE THEIR ORDER TO CASH CYCLE TIMES BY 30%-40% WITH A SMART ORDER-TO-CASH FACTORY November 2017, Nils Strachanowski, Senior Solution Architect, Hanse Orga Group PERFECTION IN DETAIL. WHITE PAPER

2 CONTENTS 1 ABSTRACT INTRODUCTION ADAPTABLE SYSTEMS CONCLUSION

3 1 Abstract The Order-to-cash cycle offers unique opportunities for enhancing process efficiency, saving time and costs. While typically the individual steps in the order-to-cash cycle such as Credit Management, Collections, Dispute Management and Cash are usually done by a number of different departments within a company, a new approach helps interlink the individual steps, simplify access to key data for all involved in O2C, and promote communication amongst the departments more effectively than ever: the O2C Factory. This whitepaper will elaborate on the benefits of an O2C Factory and how companies can go about introducing this new approach in their company. 2 Introduction Many businesses focus on one process at a time in their order-to-cash cycle when looking for process optimizations. They only optimize one part at a time, for example, their billing mechanisms. But looking at the big picture, creating automated interactive links between the processes, is definitely worth a CFO s time. A holistic approach covers the complete order-to-cash chain; from sales orders to Cash Application: interleaving and integrating the individual components within an O2C Factory is the next logical step. This enables CFOs to get a conclusive overview of their cash flows. The advantages of optimizing the order-to-cash processes are numerous, and include: Achieving standardisation of the order-to-cash processes Comprehensive tracking and reporting Automated notifications for customers and staff Reducing DSO Reducing O2C cycle time Improving customer service Generating end-to-end workflows Making the complete order-to-cash cycle fully transparent to the CFO Providing KPIs to the CFO (e.g. number of disputes, volume of bad debt losses, by region, customer, industry etc.) Less friction losses and faster communication Enhancing staff efficiency by around 30% Improved Working Capital Management Interfaces that target all corporate departments enable the CFO to get the best overview of where time is wasted or where processes can be optimized. Automating these processes makes sense, because communication across different company departments usually causes friction losses. Communicating across department lines highly relies on every staff member to know who is in charge on the other side and to react immediately without delay. But in reality this is often not the case. Having an automated system that targets the right people instantly when information is needed or needs to be conveyed, enables huge efficiency gains. Ideally inbound payments processes should interlock with high precision levels and frictionless. Like different parts of a gear, the whole process, from order to cash, should interlock effortlessly. 3

4 Usually different teams handle different aspects of the order-to-cash chain, like Sales Orders, Billing, Cash Application, Collections Management, Deduction Handling, Dispute Management and Credit Management. So having systems in place that automate processes in the area of cash, receivables and credit can impact performance significantly and enables finance teams to profit from integrated overlapping workflows. Customer management becomes a lot easier when all necessary information is gathered in one place and is documented comprehensibly. CFOs are well advised to look at their finance processes in a holistic way. The overall DSO can be reduced and staff efficiency boosted by 30% on average. 3 Adaptable systems Requirements differ highly from region to region and from industry to industry. For example, US companies usually handle more deductions than companies based in Europe. There is no such thing as just one O2C Factory. While some focus on cash liquidity others prioritize billing. So systems that are implemented into existing workflows need high levels of flexibility and adaptability. To have partners at hand who are experienced and can deploy solutions for different situations is essential for a successful integration of a fully automated Order to Cash factory. This was the case for one well-known German car manufacturer, who decided to put the O2C Factory to use in their business and where very happy to see that staff efficiency was raised and DSO reduced by 30%. 4 Conclusion CFOs are well advised to look at every aspect of their Order-to-Cash process. Ideally accounts receivable processes should interlock with high precision levels and frictionless. Like different machines in a factory, working together to achieve one goal, different receivables departments should smoothly work together to maximize their customer management and cash flows. These benefits are not only related to efficiency gains but also empower Cash Application, Credit and Collection teams with faster and more accurate information. The O2C factory can completely revolutionize order-to-cash cycles. 4

5 About Hanse Orga Group Hanse Orga Group is a leading global expert for the full financial automation value chain. Over 2,000 companies worldwide already rely on our modern software and individualized consulting for optimizing their corporate processes concerning inbound and outbound payments. In the order-to-cash area, Hanse Orga Group brings together innovative solutions to help companies benefit from a unique O2C Factory. By integrating key features for Order Management, Credit Management, Collections, Cash Application, Dispute and Deduction Management, processes can be optimized in a holistic way. The comprehensive portfolio enables highest levels of automation, process efficiency, transparency, and compliance with regulations. Individual components can be flexibly combined to meet company-specific requirements and in any combination of on-premise, cloud or hybrid and as-a-service components fully integrated with SAP ERP or outside of SAP. 5

6 Hanse Orga Group Hanse Orga Group is renowned as the global powerhouse for solutions along the entire financial value automation chain. Over 2,000 global clients including IBM, Philips and Dow already rely on our high quality, awardwinning products and SAP treasury consulting. One key aspect is that we deliver significant value add to our customers by providing innovative solutions for all aspects of the entire financial value chain, from the order-tocash and procure-to-pay cycles to treasury, corporate performance management, tax and compliance as well as powerful data and document management. Our solutions are designed for organizations of all industry sectors, from medium-sized to global players. This includes both SAP-based add-on solutions and ERP-agnostic cloud software so that companies have the choice of the solution that best fits their individual technology strategy. Founded in Hamburg, Germany, in 1984, Hanse Orga Group today has over 16 regional offices spanning across North America, Europe and Asia. Head Office Germany Hanse Orga GmbH Oldesloer Straße Hamburg Germany Tel: Fax: Contact EMEA Hanse Orga International B.V. Nieuwe Prinsenkade VC Breda Netherlands Tel: Fax: Contact APAC Hanse Orga Hong Kong Ltd. Level 9, Central Building 1-3 Pedder Street, Central Hong Kong Tel: Contact North America Hanse Orga International Corp. 205 N. Michigan Avenue / Suite 4110 Chicago, Illinois USA Tel: Fax: Revolutionize Your O2C Cycle Copyright 12/2017 Hanse Orga GmbH. All rights reserved. SAP is a registered trademark of SAP SE. 6