Order To Cash Solution: Overview And Guide For Timely Receivable Collection
TIMELY COLLECTION OF CUSTOMER RECEIVABLES SOFTWARE
As an Executive working in the finance department, reducing the time or delays between payments and streamlining the process for receiving payments are likely R&D priorities. An Order to Cash (O2C) solution can provide substantial improvement to the timeliness of receivable collection, and this guide provides an overview of how to best take advantage of O2C solutions.
Achieving Optimization
Effective receivable collection involves number of stages, from order placement to cash acceptance. Although an O2C solution can make each stage more efficient, achieving faster collection requires comprehensive approach to the overall process.
Invoicing is the first step in optimized receivable collection and should be completed as quickly as possible. Depending on the capabilities of the O2C solution, this can involve considerable automation. This can be extended to the pricing or discount calculation, as some O2C solutions have the capacity to adjust pricing or offer discounts based on customer information that is captured in the system. This can reduce administrative burden and save time.
Credit, collections and disputes management is critical but time-consuming part of the order-to-cash lifecycle. Most O2C solutions have the capacity to speed up this process by utilizing automated credit checks, suggesting credits or payment plans, and providing visibility into dispute cases. This ensures disputes can be addressed quickly and resources are deployed more efficiently.
The automated collection of payments is another important aspect that can be facilitated by an O2C solution. This includes the ability to process multiple payment types, such as credit cards and electronic checks. Most systems also provide visibility into the payment process, such as tracking payment confirmation, standardizing payment terms, providing reminders about payments due, etc.
Flexibility of Solution
Because each organization has its own unique approach to receivable collection and payment processing, the flexibility of the O2C solution is an important factor to consider. Does the solution have the capacity to be customized to suit the organizations existing infrastructure and processes? Can data be imported or exported easily? Will it integrate with the organizations existing financial and accounting systems? These are all critical questions that should be addressed before selecting solution.
Cost Consideration
The cost of the solution should also be taken into consideration. Although most O2C solutions offer cost benefit in the long run, the initial cost of implementation can be substantial. Furthermore, there may be additional costs for customization, maintenance and upgrades over the life of the solution.
Conclusion
Organizations that are looking for way to improve the timeliness of their receivables collection should consider an Order to Cash (O2C) solution. It can streamline invoicing processes, automate credit, collection and dispute management, process payments of different types, and provide flexibility to suit the existing infrastructure and processes. Additionally, cost should be taken into consideration, both the initial cost of implementation and potential long-term costs associated with the solution. Ultimately, comprehensive assessment and understanding of the solution are essential when choosing an O2C solution that works best for the organization.
