Many businesses start with a small number of employees who rely on manual order-to-cash (O2C) processes. These can be adequate in the early stages of growth, but as companies expand and scale the complexity of these workflows can quickly overwhelm the team.
To unlock future growth, your data systems have to mature into fully integrated tech stacks that effortlessly scale and support end-to-end O2C automation. However, many companies are only partially automated, and leadership may be unaware of the capabilities they could be leveraging. Fortunately, Zone & Co’s O2C Maturity Assessment Tool can help you evaluate your current tech stack and identify areas where you can get an edge over the competition.
The impact of O2C maturity on your business
Rapid growth is becoming the norm in today’s market, and companies that can handle extreme data speeds and volume are able to quickly expand their operations through new services and acquisitions. However, if their O2C systems aren’t designed to scale effortlessly, they will hit a frustrating ceiling that ultimately stalls growth and leads to decline.
Increasing days sales outstanding (DSO) is a common symptom as bottlenecks and errors throughout billing and revenue recognition pile up. These eventually spread across the business as delays and inaccuracies are distributed to reporting activities and customer interactions.
Companies that fully automate their O2C processes experience an 80% reduction in billing time, fewer billing errors and minimal revenue leakage. This leads to better cash flow and reduced DSO, and the automated data streams deliver better reporting and unlock real-time analytics. By properly integrating your core tech stack, O2C maturity represents a competitive advantage that streamlines nearly every aspect of your business.
Evaluating your O2C maturity
Nearly every business has made investments in automation and integrations for their core tech stack, and 70% of leaders view digital transformation as critical for their company’s survival. However, the vast majority still have a long way to go: 60% still say manual workload is a top challenge in their O2C process, and 65% of companies are regularly struggling with ERP data access.
That means the chances are good your core systems aren’t fully optimized. Here are the places you should look to find the gaps.
1. What is your finance team’s role in O2C?
In many cases, finance’s role in the O2C process is limited to providing operational data and a bit of perspective. The truth is that finance should be at the center of developing and implementing O2C strategies. CFOs should be taking the lead with clear integrations across all departments. Regular training should also be at the center of your O2C strategy with a substantial budget to support these activities.
Finally, because a mature O2C cycle means multiple departments benefit from highly integrated data architecture, cross-departmental collaboration with shared accountability for outcomes should be the centerpiece of your approach.
2. What are your KPIs telling you about operations?
20% of businesses experience revenue leakage of 5% or more, but that number can point to many different inefficiencies and underdeveloped O2C processes. For instance, a 2% error rate is often the product of manual workflows that are being overwhelmed – and you can’t fix it by simply bringing in more people. As the business grows, you’ll have to keep making expensive hiring investments that never solve the problem while burning more resources to reconcile the data.
Anywhere you’re implementing strategies that solve today’s problem but don’t reduce key metrics like DSO or cash conversion time, you’re probably facing an O2C integration issue that lacks automation support. Additionally, you’ll need to look at how advanced your reporting tools are for evaluating your O2C cycle. System maturity will have an impact on the accuracy and timeliness of your KPI tracking.
3. Are essential processes optimized?
Whether it’s invoicing, revenue recognition or just managing customer interactions, bottlenecks in one link in the chain can impact the entire cycle. Evaluate the areas where your people are getting frustrated or spending hours in Excel fixing mistakes – that’s probably where your O2C systems can benefit from integrations that automate your workflows.
It’s always worthwhile to examine basics like record creation, contract amendments, data entry and other daily activities. Incremental improvements across the O2C cycle can add up quickly, and in many cases, the best solutions will address many issues at once.
The value of achieving O2C maturity
Any CFO will say that integrating your tech stack and enhancing automation is a good thing, but why should maximizing your capabilities be a core business goal? Simple: the average company is using eight times more full-time-equivalent (FTE) employees to perform their O2C process than the top performers, while the worst are utilizing over 2800. That represents an enormous investment that will only increase with complexity.
By pursuing O2C maturity, you’ll secure the following benefits:
- Future-proofing your systems: One of the biggest advantages of optimally integrated systems is that they scale effortlessly. Businesses that design their O2C data architecture to support automation from day 1 will transition from startups to mature companies much more easily.
- Competitive advantage: You’re not trying to be an average company. With 50% of businesses upgrading their ERPs to address critical flexibility, integration and scalability issues, you’ll quickly find yourself slipping into the bottom half if you don’t invest in O2C maturity today.
- Reduced errors and revenue leakage: By leveraging automation to eliminate errors, you’ll not only simplify workflows across the board, but you’ll position your employees to focus on productive tasks rather than damage control.
- Maximized value for your tech stack: Even a best-of-class ERP like NetSuite can’t deliver an optimal ROI if it’s not well integrated with your other core systems.
How to unlock O2C maturity with Zone & Co’s assessment tool
Without proper evaluation of your current level of O2C maturity, you risk making investments that don’t efficiently (or sufficiently) address your actual challenges. So, where should you start?
Fortunately, Zone’s Order-to-Cash Assessment Tool makes it easy for you to identify pain points across the O2C cycle so you can find solutions that deliver maximum ROI. Here’s how to get started.
1. Access the tool
Visit Zone & Co’s O2C Assessment Tool. This will give you a refined perspective on where your processes and strategies could benefit from integrations and automation.
2. Answer the 15 brief questions
These questions cover a range of issues that may be impacting the maturity of your O2C cycle, including:
- Operations: Is your O2C approach – including training and communication – led by your finance team, or is it relatively disconnected?
- Strategy: Are your systems highly integrated and support automation across departments, or do they still rely heavily on manual processes and Excel spreadsheets?
- KPIs: Are you experiencing high error rates, extended DSO timelines, cash conversion delays and high levels of revenue leakage?
- Downstream activities: Are issues in your O2C cycle being passed to other departments, like customer interactions?
Review the results
Once you’ve completed the survey, Zone & Co’s O2C Maturity Assessment Tool will deliver a general evaluation of your current status. This includes helpful context like average DSO times for relevant industries, specific guidance for your business, solution options and valuable data points to support these results.
In many cases, products like ZoneBilling are ideal integrations for NetSuite users that address a range of O2C maturity challenges. Not only does ZoneBilling support automation across your O2C cycle, but it also provides CFOs with the real-time data streams and optimized workflows they need to take the lead on O2C strategy.
Real-world success stories: Achieving increased O2C maturity with ZoneBilling.
There are many companies that have revolutionized their O2C cycle from billing to revenue recognition with ZoneBilling. Here are some of the most successful standouts across a range of industries.
Lattice
Lattice, a leading developer of AI-driven HR software, was struggling to scale its manual O2C processes as it transitioned out of the startup phase. Disparate systems that lacked integration and a heavy reliance on manual billing workflows made it extremely difficult to keep up with invoicing, customer queries and complex subscriptions.
“The complexity of our deals was too much for our billing system, so we had to use spreadsheets for accurate tracking. This significantly increased our manual workload.” – Lakshman Manoharan, Head of Business Systems at Lattice
By adopting ZoneBilling, Lattice was able to achieve a 90% improvement in billing efficiency that distributed benefits downstream to reporting and improved customer interactions.
Power Factors
Renewable energy software solutions firm Power Factors found itself grappling with a complex and inefficient billing strategy that could be overcome through NetSuite’s out-of-the-box capabilities. Their software was installed on each customer’s in-house system, and managing the data from hundreds of unique systems around the world proved to be too much of a challenge for their current level of O2C maturity.
“Although we have more than 600 customers, we don't have 600 data points. It's tens of thousands of data points.” - Sandro De Ciccio, VP, Controller at Power Factors
By adopting ZoneBilling, Power Factors was able to implement a billing strategy that effortlessly scaled despite increasing complexity across a global network of users.
Get started on the path to O2C maturity with Zone’s assessment tool
If your DSO is slowly creeping up and no matter how many people you hire it doesn’t seem to make a dent, the cause is more than likely a lack of O2C maturity. And with data speeds and complexity accelerating every day, NetSuite users need to be out in front of growth and scaling challenges – not waiting for them to pile up.
You can supercharge your digital transformation today by taking a few minutes to evaluate your system architecture with Zone’s O2C Maturity Assessment Tool. This will give you fast insights into the areas where you may be most vulnerable to errors, revenue leakage and future scaling challenges.
Growth is inevitable, and products like ZoneBilling ensure your systems are prepared for any opportunities that come your way. If you’re ready to learn more, book a demo of ZoneBilling with one of Zone’s experts to find out exactly how much value it can deliver for your business.
