From the second a fledgling business gets their first glorious order, they have, whether they realize it or not, hopped aboard what is known as the Order-to-Cash Cycle.
With each new order or service request, the process repeats. The end goal? Revenue generation and the encouragement of repeat business through a seamless, transparent customer experience.
But within that journey, taken one or 100 times, there comes as many pitfalls as there are opportunities to evolve and flourish.
What exactly is the Order-to-Cash Cycle, though?
The Order-to-Cash (O2C) Cycle is a framework that encompasses all stages of the service flow from the initial product/service request right the way through to the sweet, sweet revenue hit.
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It deals with everything from order management, invoicing, credit management, fulfillment, and end-of-sale cash management. The stages involved in the cycle can vary depending on the nature of the business itself and how they choose to build their sales channel.
Credit management, for example, can factor in early if the business chooses to offer lines of credit where this may be omitted for small-scale, one-and-done sales.
It might be tempting to believe that the fluidity with which businesses can alter the look of the O2C Cycle means it’s just another piece of redundant business jargon. However, a clear definition of what your specific O2C Cycle looks like will help codify what’s necessary for exemplary customer experience and efficient, no-nonsense revenue generation.
Regardless of the building blocks that go into a specific company’s O2C path, there are key considerations that will ensure effective, long-life success no matter how much the business landscape changes.
As you move through the Order-to-Cash Cycle, multiple departments are going to play a key role in service delivery. With that in mind, cross-departmental communication needs to be airtight to avoid a provision logjam.
Any business knows you can provide the moon and the stars, and the customer may very well come back and say they didn’t realize they simply don’t have enough storage space for Jupiter.
Or something similar.
While you can’t anticipate every customer hiccup, you can streamline your business and iron out internal wrinkles with cross-platform SaaS solutions and integrated fulfillment processes, which, in turn, will help you get a handle on considerations like order processing costs.
Further, communication and documentation on O2C updates or changes mean no one gets left behind, and employee onboarding is simplified exponentially. There can be no excuses for anyone lagging behind, whether they are new or old.
Automation is everywhere. From robotic fulfillment in the burgeoning population of dark stores worldwide to accounts payable processing, scripting elements of your supply chain that are subject to little or no daily variation will free up labor resources.
Equally, it will also remove the greater potential for human error.
Further than this, though, automation can also greatly speed up the O2C Cycle, meaning smaller businesses can close the gap on their larger-scale competitors with a proportionately minimal investment.
The more people in your organization you free up from the minutiae of their daily tasks, the more you will allow the people-driven aspects of your business to flourish. The time and budgetary constraints of old will dissolve as you start to see the ROI on automation solutions. Creative, entrepreneurial foundations that got you into business in the first place can once again take center stage.
Stay front and center for your customer
Intra-company transparency and awareness of potential automatable tasks are key, as we’ve discussed. But the customer-facing aspect of the O2C Cycle has its own considerations where these metrics are concerned.
A customer shouldn’t be kept in the dark when it comes to their order lifecycle. From the time they place their initial product/service request through to delivery and payment, there are multiple opportunities to allow the customer windows into your process to make them feel engaged and valued.
Regardless of what omnichannel experiences are now the norm pre or post-sale, one thing remains true, people value the personal touch. Automating order process notifications is one way to add value to your customer interactions with zero effort.
The customer is in the loop and will be less likely to get in touch about the status of their order, further reducing direct customer interaction time and customer care labor hours.
The knock-on effect of this is faster turnaround times, legitimate customer issues, and higher success rates SLAs for resolution. It’s a win/win!
Keep Upping Your Game
No business operates in a vacuum. If it did, mom and pop would still be delivering freshly baked pies off the back of a bicycle built for two.
Constant assessment of your processes, people, and automated actions will keep you on the cutting edge of customer provision.
Various metrics can be employed to gauge your success and any areas for improvement. Keeping an eye on your perfect order rate and supporting applications keep every step in your custom-built cycle fit for purpose.
For each KPI a business uses, new insights reveal themselves. Employing a real-time eye will also allow you to chart the progress of your business and its position in your corner of the market, allowing you to pivot where necessary.
The last two years alone have created some exciting new omnichannel realities for customer interaction that many businesses can benefit from when it comes to evolving their CX strategy, for example.
Where to start?
The good news is, if you’re in business and making money, you already have an Order-to-Cash workflow. With that in mind, the only thing you need to do now is to get the process down on paper.
Look at it for what it is, out there in the world, and take it from there.
Start to assess your stage-fulfillment systems as they relate to each other and consider what processes could benefit from trialed automation. Then, use retail metrics and KPIs to measure success and refine what you’re already doing to bring as much success as possible to the tasks that bring in the cash.
From there, you should start to realize that the vast gulf between planning the sales call and banking those precious dollars becomes a must more organic, effortless endeavor.
Pulling apart and refining each stage in your cycle will quickly turn it from a pushbike to a superbike!