Leverage Software To Enhance Order To Cash Performance
Dso Calculation Methods
To secure financial performance, C-Suite executives must devote effort and resources to the order to cash cycle, in order to ensure that customer payments are collected and processed efficiently. Chief decision makers may find that incorporating software into the equation is highly beneficial to optimizing the cycle. Specifically, employing software that aids in calculation of Days Sales Outstanding or the average time it takes business to collect investment from clients can be an important tool in improving operational performance.
To determine the optimal way to use software to manage day sales outstanding, executives must undertake comprehensive assessment of the existing process. This involves analyzing the effectiveness of current tools, including data-capture systems, ERP systems, and financial applications. The review should analyze the interconnections among systems, tracking processes, and costs associated with manual entry and reworking. Factors such as customer data, payment terms, serviceability, invoicing, and customer communication will prove essential in developing methodology for the computation of DSO.
Once the assessment is complete, executives can move on to studying the software products available that may offer efficiencies. Conducting market research on the products and their respective features will assist in determining the best fit for particular business? operations and workflow. To ensure accurate calculation of companies DSO, the software ought to include the ability to easily track cash sale and customer payments, have customer credit management and customer notification functions, provide reliable metrics, and offer improved data collection and reporting.
A successful execution of order to cash cycle commences with the installation of new software. As such, executives must ensure that their chosen partner is dedicated to customerservice and is well-equipped to handle the transition. Qualified support personnel should run sprints to ensure that all customer and vendor data is correctly migrated and that users are adequately trained.
The benefits of introducing software to manage the order to cash cycle are numerous and can contribute notable successes to companies which seek to maximize their financial performance. It is necessary, however, to invest the necessary time and resources into researching available products and services in order to find the most efficient travel agent for their business model and customer profile. Executives must also be sure to give the changing process the regard it deserves, by designing the implementation in way that works best for the company and its customers. Once the process has been fine-tuned and the software put in place, C-Suite leaders will undoubtedly begin to reap the tangible rewards of smooth order to cash operation.
