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Modernized Order-to-Cash: Journey to transformation
Yashi Sharma F&A Practice Lead, Digital Process Operations | October 16, 2020
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The COVID-19 era has challenged organizations to deliver more in less. More cost savings, extra productivity benefits, increased return on investment (ROI), improved metrics in performance, a greater and enhanced control framework— all in an environment of limited resources and remotely managed engagements.

Today, CFOs are thinking about the ways to make this happen and how to bring greater impact on the company-wide business through increased revenues and cash flows. The winning teams are looking for enhancements on design, transformation, and running of the Finance and Accounting (F&A) processes with support of their chosen digital process operations (DPO) partners.

The ones trailing behind are waiting for the right time when things will come back to normal, not realizing that the right time is ‘now’ as this is the ‘new normal’. They say, “Necessity is the mother of invention”. There is no bigger necessity now than to survive the current global business slowdown and its adverse impact on the various industry sectors while maintaining a healthy financial profile.

As we engage with our customers, we recommend them our proposition around modernizing their Finance & Accounting F&A function with preconfigured innovative concepts which can provide value to them through improvement in their corporate productivity ratios. The benefits from this exercise can get them an extra pool of talent to focus more on business growth and savings which can be leveraged in other critical areas.

We recommend organizations on our proposition around modernizing F&A function with preconfigured innovative concepts which can improve their Corporate Productivity Ratios

Let us pick the order-to-cash process (OTC) as a sub-function and illustrate how this can be done end to end. We applied this simulation very recently to a manufacturing major but this is equally beneficial to all other industry segments such as RCPG (Retail and Consumer Packaged Goods), TMPE (Telecom, Media, Publishing, and Entertainment), E&U (Energy and Utilities), BFS (Banking and Financial services), Hi-tech, amongst others.

Typically, our preconfigured solution will be 70% applicable to all the industry segments, with a variability of only 20-30% on a case-to-case basis. Reasons for the same could be to process exceptions (it can be a simple or a relatively complex process) or the technology (more instances of ERPs or a fragmented IT landscape or a low level of API integration). Whatever that delta is, we will apply our due diligence toolkit to drill down further in your process environment and bring the overall report to you.

For this customer, we simulated a process behavior intelligence through application of multiple tried and tested set of levers that enabled the targeted results:

Lever 1: Impact as a percentage of revenue at an organization level through people cost reduction. (If the customer’s SG&A (Selling, general and administrative expenses) was X% of their revenue, what value the HCL Digital Process Operations (DPO) made on the SG&A improvement at large)

Lever 2: Impact through improvement of business metrics for the function. Gainfully influence key OTC process value outcomes such as reduced sales outstanding, past due percentage, and disputes/deductions outstanding.

Lever 3: Impact for the outsourced section through productivity, clearly calling out the differentiation caused through

  • Location consolidation and centralization
  • Process standardization and optimization
  • Automation and tooling

Examples of the Impact delivered through Lever 3 can be like but not limited to below, depending upon the applicable factors and synergies: -

  • Reduced cycle times for order-to-cash processes through the automation of receivables and payments processes across credit, electronic billing, payment processing, and straight-through cash application processing.
  • Eliminate revenue leakage through proactive dispute identification/resolution and invalid claims recovery.
  • Increased visibility across the entire order-to-cash process through intelligent analytics and reporting

All these put together helped streamline and automate the OTC process, optimize cash flows, and improve working capital for our client.

At HCL DPO, we partner with our clients harmonizing our skills with their requirements. Our deep domain knowledge and technology capabilities put forward extensive solutions and run them successfully to gain the desired outcomes. We understand that transforming ideas and solutions into reality takes a continuous and coordinated effort, focused on execution. Through collaboration, innovation, and proven approaches, we deliver transformation and meaningful results for enterprises worldwide.

Please feel free to contact us at YashiS@hcl.com or sameer.ahluwalia@hcl.com to discuss about your order-to-cash initiatives and challenges, and see how HCL can collaborate with your organization to drive business value.