integrated order to cash

Integrated Order-to-Cash Transformation for Global Shared Service

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Agenda of integrated order to cash

  • Introduction
  • Shared Service Organizations’ Delivery Imperatives
  • Capabilities & Competencies Needed
  • Digital Automation Required
  • Case Study
  • Benefits
  • Conclusion
  • Questions

Integrated order to cash introduction

  • Shared Services Organizations (SSO’s) exist to provide services better & cheaper than they would be performed in a decentralized environment
  • The performance demanded of SSO’s is rigorous, and closely measured & monitored. For third party providers there are financial penalties for shortfalls
  • An optimal mix of Process, Metrics and Technology is required to meet the demanding requirements

SSO Delivery Imperatives

Existential Challenge

Integrated order to cash operating divisions (= internal customers), biased toward decentralized operations (control)

Service Level Agreements (SLA’s)

  • escalate every year
  • elaborate
  • shortfalls punished

The Productivity Annuity – efficiency & effectiveness

Accommodate all Divisions and Business Models

Wide variation in revenue streams, customers, markets, ERP’s

Capabilities & Competencies Needed

Policy

  • Documented policies with clear exception protocols
  • Work reduction policies, (e.g.; contractual allowance for shortages & damages, automatic small balance write-off)

Process: Best Practice process adapted to businesses served
Metrics: the “right” ones; fewer vs more
Analytics: insight
Governance
These elements provide the foundation for success

Incremental vs Exponential

  • Incremental improvements will suffice for the short term
    • improvement, especially for newly integrated operations, is appreciated
  • Sustained, high value improvement will require exponential leaps forward in several sub-processes to compensate for inevitable low improvement in other sub-processes (constrained by business models, investment limits, competition or existing excellent performance)
  • Exceptional performance unlikely without Digital Automation

Digital Automation Required

  1. Digital AR Portfolio Monitoring
  2. Digital Credit Risk Management
  3. Digital “Low Touch” Collections
  4. Digital AI Powered Cash Application
  5. Digital Deduction – Dispute Resolution
  6. Customer Self-Service EIPP Portal
  7. Analytics

1. Digital AR Portfolio Monitoring

  • Automated consolidated receivables – in total and by customer from multiple ERP’s
  • Automated consolidated AR portfolio analysis – aging, risk, payment behavior pattern
  • Collection portfolio allocation to Collectors
  • Improve information access to AR data and documents for you and your customers

2. Digital Credit Risk Management

  • Customizable, on-line credit application with digital signature
  • Automated customizable credit scoring – with real time import of credit bureau data and payment history
  • Automated AI powered credit decisions based on pre-defined rules to assign credit limits
  • Full featured Approval Workflow guided by Delegation of Authority policy
  • Automatic order hold integrated with Collections

3. Digital “Low Touch” Collections

  • Configurable Collections Strategy – multiple parameters
  • Prioritized Task List
  • Collector Workbench with all required information
  • Automated Dunning – 100% customer touch

4. Digital AI Powered Cash Application

5. Digitally Assisted Deduction/Dispute Resolution

  • AI assisted dispute reason code assignment
  • Full featured Workflow to route deductions to assigned Resolver, with audit trail, internal dunning, & robust reporting of status & results
  • Automatic credit to debit matching & clearing
  • Root cause Analytics to fuel process improvement efforts
  • Mobile friendly workflow

6. Customer Self-Service EIPP Portal

  • Presents invoice, accepts payment with customer inputting remittance advice
  • Online Payment Options
  • Customer can register a dispute
  • Customer can self-access its account information
  • Mobile Friendly

Self – Service: Customer substitutes their labor for yours

7. Analytics Digital Dashboards and Insights

  • Consolidated Database of all OTC operations
  • Analytical insights fuel process improvement which can deliver Exponential improvement (e.g., invoice accuracy to 99%)
  • 50 pre-formatted analytic dashboards & reports with ability to custom configure your own
  • Credit Risk Analytics to measure overall credit risk of an AR portfolio

Case Study

Problem Overview

AHA launched eCommerce site ShopCPR to sell CPR equipment and classes online. Credit Processing cycle time was over 2 weeks. They needed B2B digital credit solution to accept more customers and do more business.

Customer Value

  • Deployed Emagia Digital Credit Solution – Mobile and ADA compliant
  • Digital signatures, digital trade and business reference checks
  • Integrated with Experian, AHA custom score-card, automatic credit limit decisions enabled.
  • AHA reduced B2B credit approval process from 2 weeks to 24 to 48 Hrs
  • Now processing over 200 -300 credit applications per month
  • Scalable foundation for digital ecommerce growth

Benefits of Efficient & Effective SSO

Enhanced Customer Experience
Cost Savings: staff cost, bad debt expense, funding of AR
Improved Service to Internal Customers
Data Repository to guide Operational Improvements Higher Revenue & Lower Cost over the Long Term

  • Improved Customer Experience/Satisfaction
  • Controlled Credit Risk
  • Greater Cash Flow
  • Increased Revenue & Profit
Conclusion
  • SSO’s have an unrelenting demand to deliver excellence at lower cost every year
  • Many factors influence an SSO’s ability to meet that demand – Process, Policy, Governance Technology, etc.
  • It is unlikely that an SSO can meet its demands on a sustained basis without substantial utilization of today’s Digital Automation tools