Businesses are growing more rapidly than ever before, and their ability to keep pace with mounting complexity in the order-to-cash (O2C) process can be the difference between success and failure. In a study by PYMNTS of companies with annual revenue of $250 million, 68% of CFOs said delays in payments caused significant problems across the business in the past six months alone.
To handle the increased workload, startups are often forced to automate. However, a lack of expertise in O2C system stack architecture can lead even the most well-meaning CFO to implement solutions that cause downstream issues or fail to future-proof the business. By understanding how your tech stack should be designed to address today’s core business challenges with order-to-cash automation, you’ll be prepared to capitalize on all your growth opportunities.
Why is O2C automation critical?
In a 2024 State of Finance Automation Survey, CFOs expressed a sense of urgency around automation in response to the rapidly evolving dynamics in the O2C cycle startups and maturing businesses face. With today’s unprecedented data speeds, startups are essentially born global, and companies can develop and sell products faster than ever. That leads to accelerated growth and the potential for acquisition, and all of these factors contribute to dramatic complexity increases in the O2C process.
That’s why it’s imperative to design your O2C tech stack for growth and scaling early with a focus on systems and strategies that leverage order-to-cash automation. Expansion and customization of product offerings and pricing models all put pressure on billing and revenue as volume increases, and the issues are compounded by regulatory reporting requirements. Errors and delays are passed on to business intelligence (BI) activities, and all these challenges represent serious financial and reputational risks.
Anywhere a business relies on manual workflows in the O2C cycle can become pain points that lead to revenue leakage or potentially overwhelm your team. 65% of Zone survey respondents who relied on manual processes experienced significant revenue leakage – nearly double their automated counterparts.
O2C tech stack overview
To leverage automation effectively, businesses need to have a thorough understanding of their O2C tech stack and how these systems interrelate. The following critical components need to be optimized and properly integrated to support order-to-cash automation and eliminate manual processes.
- CRM/CQP: A Customer Relationship Management (CRM) platform manages customer interactions and maintains an account record, while Configure, Price, Quote (CPQ) software handles flexible pricing and service models.
- Front end: This is the user interface for navigating, customizing and purchasing your products and services.
- Payment processor: A payment provider like Stripe handles digital transactions and sends that information to your ERP.
- ERP: Your Enterprise Resource Management (ERP) platform coordinates all of your day-to-day operations, including accounting, supply chain, compliance and project management.
- Billing: Billing software is responsible for generating and delivering invoices and collecting payments. This is where manual processes and inefficiencies can quickly lead to revenue leakage – it’s a prime candidate for order-to-cash automation investments.
- Revenue: This engine is responsible for revenue recognition, and interacts with billing to meet regulatory requirements and streamline cash flow.
- Integrations: These control how data moves between all your O2C tech stack components and regulate the quality of their output.
- Data/BI: These tools are used by finance leaders to analyze the data your O2C systems generate for reporting, modeling and forecasting purposes.
In every area but customer billing and invoicing, over 50% of financial leaders said their companies were only partially automated to using fully manual workflows in the Zone survey. They reported their teams spent 25 hours or more each week on tasks like reconciliation, and 25% were devoting 30-40+. All of these activities contribute to lost revenue and resources while increasing the likelihood of costly errors.
Key O2C tech stack considerations
Your ERP is the heart and soul of your O2C tech stack, and selecting a best-in-class platform like NetSuite allows for substantial automation opportunities as your business grows. You will need to carefully consider how your data flows from every system to and from your ERP, particularly for billing and revenue.
This is especially important because O2C inefficiencies affect every department in your business – not just finance. For instance, delays in invoicing or revenue recognition can trickle down to reporting, forecasting and compliance. As a result, solutions for billing and revenue should be easy to implement and mesh with workflows across all relevant departments.
Billing
In order to scale rapidly with your business, your billing platform will need to support a high degree of pricing model flexibility, subscription bundling and contract billing. Robust e-invoicing promotes globalization capabilities, and all of these features support increased order-to-cash automation.
While 82% of Zone survey respondents reported fully to partially automated billing systems, there is still a lot of room left for improvement. Financial leaders pointed to ongoing bottlenecks in the billing process, and to reach maturity, many institutions are looking for competitive plug-and-play solutions for top systems like NetSuite.
Revenue
Your revenue engine will need to provide deep visibility for reporting and analytics and integrate seamlessly with billing and collection. It should allow your Accounts Receivable (AR) team to customize and manage modifications effortlessly to avoid compliance issues with advanced automation support.
Data flow
Your CRM is the business’s source of truth for customer data and beyond. Your O2C tech stack needs to seamlessly integrate with your CRM at every stage to optimize billing and revenue automation opportunities. Always consider the relationship between the billing and sales side and how data will flow to revenue and AP.
Assessing your O2C tech stack
When assessing your O2C tech stack for automation maturity, finance teams should ask the following questions to support actionable insights for the business.
- System functionality: Are your business needs clearly defined and well understood? If so, is your system meeting those needs today, and how will it do so over the next 6-24 months?
- Process design: Does your team understand your processes and are they clearly documented? Are they easy to teach, or are they error-prone?
- Data: Is there one source of truth for customers, products and orders? Are your data streams clean and free of duplicates? Do you have a global ID that links records across systems?
- Automation & integration: Do you leverage integrations between systems that support automated workflows? Is automation built in and are there quality controls in place?
- Controls: Are user roles well-defined? Can users make changes to system data without approval, or are there review and approval processes in place?
Tips for promoting growth and scaling
When you’re selecting or upgrading your systems, you will likely have a lot of choices available. However, every business’s O2C tech stack is unique, and the wrong component can inhibit future growth opportunities.
When evaluating your tech stack’s suitability for growth and scaling, keep the following in mind:
- Think about the outputs you need, including financial reporting, metrics and KPIs.
- Evaluate billing and revenue early to save costs, reduce auditing headaches and enable revenue.
- Plan for automation in validation, approvals and data transfers.
- Prioritize data quality.
- Define a system of record and implement controls around data movement.
Best-in-class O2C systems
Today, there are several systems that stand out from the competition in terms of automation potential, scalability, efficiency, and functionality. Here are the top O2C platforms every CFO should consider for their tech stack:
- CRM/CPQ: Salesforce allows businesses to scale endlessly with autonomous AI agents, unified data and CRM apps in one integrated platform.
- Payment processor: Stripe is one of the most popular payment platforms today, scoring high marks for customization and ease of use.
- ERP/Revenue: Oracle NetSuite is the #1 cloud ERP and supports a wide range of apps and integrations. Plus, its revenue module NetSuite ARM enhances revenue forecasting, recognition, reclassification, deferral and auditing.
- Billing: ZoneBilling is an advanced billing and revenue management solution that extends Netsuite’s native capabilities to deliver automated workflows across the O2C process. People management platform Lattice learned this firsthand when they leveraged ZoneBilling to combat manual workflows, disconnected systems and scaling limitations to achieve a 90% improvement in billing efficiency.
Future-proofing your O2C tech stack with automation
Regardless of your business’s O2C cycle maturity, enhanced automation will be closely linked to competitive advantage for the foreseeable future. Zone & Co is leading the way with advanced software and integrations for Netsuite users that automate critical processes across your O2C workflow. Order-to-cash automation products like ZoneBilling eliminate manual workflows and costly errors, support highly flexible billing models and ensure compliance with regulations like ASC 606.
Book a demo today to find out more about how Zone & Co can maximize the capabilities of your O2C tech stack and empower your business to effortlessly grow and scale.
