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Connected order to cash for agility and growth

How leveraging digital and analytics capabilities can decrease operating costs and increase customer satisfaction

OVERVIEW

As companies focus on increasing competitiveness and profitable growth, they need increasingly agile operating models to address customer and marketplace demands. Additionally, greater operating efficiency helps free funds to reinvest in growth initiatives.

However, in many companies, the order to cash processes remain siloed and labor-intensive. New and diverse channels make it harder to meet customer expectations. As a result, conventional approaches to order to cash often provide inconsistent service to customers, do not meet internal KPIs and are expensive to operate.

To address this, companies should transform their order to cash processes through an innovative, holistic and connected approach.

TRANSFORMING ORDER TO CASH

In our experience, a business driven approach can accelerate and increase the success of transforming order to cash. It involves:

  • Defining the service strategy. This helps companies to align service quality according to customer segments’ requirements, reduce the cost-to-serve, and increase internal flexibility and discipline

  • Establishing the organizational structure, often with new specialized roles in a multi-tier structure

  • Evaluating centralization and outsourcing as key levers to improve flexibility and decrease costs

  • Connecting end to end processes and align neighboring functions’ activities towards the common goal: customer satisfaction

  • Incorporating the latest appropriate technology (digital and analytics) that will enable predictive insights

DIGITAL’S IMPACT

Digital is disrupting traditional order to cash, helping it to be:

Automated

Robotics can not only enable automation of step by step activities but also help solve complex cases based on historical patterns across multiple complex data sources (i.e., unstructured text, speech recognition and video data). Automation helps reduce errors and time to completion as well as operating costs. In the order to cash process flow, achieving a +90 percent rate of “untouched perfect orders” (i.e., without any manual intervention) should be a reasonable target in the near future.

Predictive

By generating insights through robust analytics capabilities, companies are better able to predict customer issues. A digital control tower can provide information about imminent out of stock situations that can lead to lost sales. Collections functions can gain insights about future customer payments. These predictive capabilities help order to cash functions to proactively identify potential issues and mitigate their impact resulting in improved service and business outcomes.

Another advanced capability is digital sales orders. Many companies wait for the salesforce or customers to place the order. However, leading companies use predictive analytics combined with online store data and internal marketing insights to automatically generate sales orders. This contributes to greater on-shelf-availability and realized sales at a lower operating cost.

A leading global consumer goods company with businesses in multiple categories had a large, decentralized and costly order to cash organization. Accenture helped transform the global operating model and, within two years, operating costs decreased by 20 percent and customer overdue debt decreased by 10+ percent. Additionally, the company has gone from poor customer service ratings to now being recognized for good customer service.

Connected

Despite companies’ efforts, many commercial investments have little or an unknown impact on generating demand. For example, for consumer goods companies, trade promotions and trade terms are well-known challenges, and transactional driven traditional approaches only partially solve the issue. A connected approach enables a new revenue growth management capability to holistically optimize company commercial investments (i.e., promotions, price, trade terms and product portfolio). This further connects commercial and marketing processes and can help increase profits.

At a Global Scale

Global companies require global order to cash operations that adequately support their expansions plans both through entering new countries and through acquisitions. Standardization is key; however, “one size does not fit all.” Accenture helped one multinational company with products in multiple categories to create and deploy a global order to cash model. To address the diverse requirements, Accenture defined three archetypes into which each of the 101 countries fit.

BENEFITS OF CONNECTED OTC



The connected order to cash operating model, powered by digital and analytics, helps companies achieve business objectives:

  • Growth:

  • Gross margin improvement through a revenue growth management approach

  • Increased customer satisfaction

  • Improved service levels

  • Faster time to market with new acquisitions

  • Cost reduction and working capital improvements:

  • Reduced operating costs by streamlining processes: eliminating waste and driving automation, developing new roles, driving centralization towards cost efficient locations and leveraging outsourcing vendors

  • Reduced logistics costs by respecting delivery agreements through the service strategy engine (i.e., reducing rush deliveries, respecting MOV, MIQ)


Authors

Franky Mas de Xaxás Faus

Franky Mas de Xaxás Faus
Managing Director, Accenture Consulting,
Global Lead—Connected Order to Cash

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Judith Palmés Bosch

Judith Palmés Bosch
Managing Director, Accenture Consulting,
Connected Order to Cash

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Contributor: Angels Tornero, Senior Manager, Accenture Consulting, Connected Order to Cash

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