Unlocking the full potential of order-to-cash at every business stage

The order-to-cash (O2C) process is more than an operational workflow – it's a critical framework you can use to improve cash flow, customer satisfaction and efficiency. But the O2C process isn't static – it evolves as your business matures. That's why we've developed this guide, which provides a structured approach you can use to optimize your O2C process at any stage of maturity. In the guide, you’ll find some background and context on the OTC process, detail the OTC maturity model and outline some practical steps you can take to improve it. The guide also explores how you can refine your O2C capabilities through order-to-cash automation, which can strengthen your business's financial health and set it up for sustainable growth.

What is the order-to-cash process?

The order-to-cash process is the complete set of business activities involved in receiving and fulfilling customer orders and collecting payment for those orders. This cycle starts when your customer places an order and extends to order management, billing, accounts receivable, cash collection and reporting. By making each function as efficient as possible, you can keep your cash flow predictable, manage customer relationships more effectively and prepare your business for growth. 

The importance of optimizing the order-to-cash process

Optimizing O2C is essential, especially if your business relies on recurring billing. That's because any inefficiencies or errors in your O2C process can repeat, accumulate and compound over time, directly impacting your cash flow, customer retention and growth potential. Here are a few ways a better OTC process can improve your company's operational health and stability.

1. Improve cash flow: An optimized O2C cycle directly impacts your cash flow by reducing delays in invoicing and payment collection so you can secure revenue faster.
2. Enhance customer relationships: Mistakes or inconsistencies in invoicing can frustrate your customers, leading to delayed payments and disputes. An efficient O2C process creates a transparent and seamless billing experience that reduces customer friction and improves retention.
3. Boost operational efficiency: Streamlined workflows reduce the manual burden on your finance team, allowing them to focus on strategic activities rather than routine tasks. A refined O2C process also means fewer billing errors and delays, which can accelerate product delivery and revenue recognition.

If your business relies on recurring revenue models for a predictable and consistent cash flow, optimizing your O2C cycle creates additional benefits. It helps stabilize revenue collection, minimize late payments and ensure that each billing cycle flows smoothly. Additionally, because the customer experience strongly correlates with revenue growth, an efficient O2C process that emphasizes billing transparency and accuracy can provide a gateway to improving your renewal and upsell rates.

Understanding the O2C maturity model

Order-to-cash optimization is a journey that evolves as your company grows. Our white paper, "Optimizing order-to-cash at every growth stage," offers a four-stage maturity model to assess your company's progress. Each stage reflects increasing levels of process automation, efficiency and strategic impact, helping companies move from manual workflows to advanced, data-driven O2C operations. Download the full white paper here to explore these stages in depth and find actionable steps to help your business elevate its OTC maturity.

1. Reactive
   At this initial stage, O2C processes are primarily manual and fragmented, relying on spreadsheets, emails and/or outdated systems. For instance, if you're a small manufacturing company, you might still use Microsoft Excel to track orders and invoices. As a result, you’re likely experiencing frequent billing mistakes, missed payments and cash flow inaccuracies. Transitioning out of this phase is essential, as manual processes can only scale so far. Automating some basic billing and invoicing tasks can streamline your businesses' workflows and reduce manual errors.
2. Developing
   If your company is in the developing stage, you may have started to integrate foundational automation tools, creating more standardized and efficient workflows within your departments. However, some of your processes may still be siloed, with limited team coordination. For example, if you're a mid-sized service provider, you might have implemented invoicing software but still manage your collections manually. So, while your billing process might be more consistent, issues such as late payments likely remain. To fully leverage the benefits of this stage, you can centralize your O2C functions under a single platform, which can enhance your visibility and control across departments.
3. Established
   An established O2C process involves significant automation and integration. If your company is at this stage, you've likely synced your workflows across departments to reduce process bottlenecks and improve collaboration. For instance, if you're a large subscription-based software business, you may have connected your CRM, ERP and billing systems so your sales, finance and support teams are all working from the same data. You may also have a dedicated O2C team to manage and oversee the process. At this level, you're likely seeing tangible improvements in cash flow optimization and customer satisfaction, but there's still room to improve.
4. Advanced
   In the advanced stage, you haven't just automated the OTC process but strategically optimized it to enhance your operational workflows and customer relationships. If your company is at this level, you're using advanced technologies like AI and machine learning to forecast demand, predict cash flow trends and continuously refine your OTC processes. For example, as an established software-as-a-service (SaaS) business in this stage, you might use predictive analytics to identify payment patterns to proactively manage your receivables and flag potential issues before they arise. This type of OTC maturity helps your finance teams focus on high-level strategic decisions that support long-term growth.

Understanding and advancing through these stages can transform your O2C process from a reactive, manual operation into a forward-looking, growth-focused strategy. 

Want to know where your business is in the OTC maturity model? Take our order-to-cash maturity assessment today.

Common bottlenecks in the O2C process

Several recurring issues can slow down your O2C processes, affecting both your cash flow and customer satisfaction. That's why it's essential to recognize and address them.

• Manual billing errors: If you rely on manual data entry to track invoices and payments, you'll likely see high error rates, billing delays and missed payments. Billing by hand increases your costs and consumes your team's valuable time. 
• Delayed payments: Without automated tools for payment tracking and reminders, your finance team may struggle to stay on top of overdue accounts, which disrupts your cash flow and adds to your collections workload. 
• Siloed systems: When your CRM, ERP and billing systems operate on separate platforms, you're likely to find inconsistencies in your customer and financial data – and inefficiencies in your workflows. This lack of integration can also affect your invoice accuracy, reconciliation and cross-departmental coordination, which your customers will likely notice. 
• Limited visibility into cash flow: Operating without real-time insights into cash flow trends and customer payment behaviors can force your finance team to act reactively rather than strategically. That can happen frequently when your ERP, billing and reporting systems operate from different data sets. 
• Inconsistent customer communication: When your communication with customers is unclear or inconsistent – especially around payment terms or billing details – you're more likely to notice payment delays and customer conflicts. 

Practical steps to advance O2C efficiency

No matter your company's stage, taking practical steps can improve your O2C efficiency:

1. Map your current O2C process: Visualizing your company's entire O2C flow, from customer order to payment collection and reporting, helps reveal bottlenecks and inefficiencies. Mapping the process shows you the data hand-offs between systems and highlights which steps are manual versus automated. The mapping process provides an excellent opportunity to involve stakeholders from across departments, which creates a shared understanding of the mission and improves the likelihood that you'll get buy-in when it's time to make process changes.
2. Standardize data and workflows: Establishing a central data repository allows all your departments to work from the same information, ensuring their data is current and eliminating manual data reconciliations. It's also important to set up standardized data handoffs at critical points in the OTC process, which can help you avoid the costly errors and miscommunications that sometimes occur when data is shared. 
3. Implement phased automation: Automation can drastically reduce your team's manual work in high-impact areas like invoicing and payment reconciliation, but taking it in manageable steps is a good idea. Begin by automating the most time-intensive tasks, then expand to other areas. For example, Power Factors, a Zone & Co customer, cut its revenue booking time by 94% by automating its billing with ZoneBilling.
4. Establish O2C governance: By creating a governance structure dedicated to the O2C process, you can instill a sense of ownership and accountability in your team while strengthening cross-departmental collaboration. Assign responsibility for key areas of O2C, such as billing accuracy or customer data management, so each function contributes to the process in a granular and meaningful way. As part of the governance process, establish a continuous cycle of regular reviews, which helps you adapt your O2C strategies as business needs evolve.
5. Analyze and optimize continually: Even after your workflows are automated, there's always room for improvement. Review metrics like days sales outstanding (DSO), accounts receivable turnover and customer lifetime value (CLV) regularly to identify opportunities to improve your OTC process. 

Want a great example of data integration in action? Learn how we're connecting Stripe directly to NetSuite to accelerate payments.

The role of technology in O2C optimization

Technology is central to making your O2C process efficient, adaptable and aligned with your growth goals. Choosing the right tools allows you to turn your O2C process from a transactional workflow into a strategic function that improves long-term financial planning.

• Integrating ERP, CRM and billing systems: Unified data management across platforms allows your finance, sales and customer service teams to access consistent, real-time data. This integration eliminates silos and keeps your departments aligned on important customer, payment and fulfillment information. That's why our products integrate seamlessly with NetSuite, the #1 ERP in the market.
• Leveraging automation and advanced technologies: Automating data-intensive steps like billing, payment tracking and reconciliation can help your teams work more efficiently while reducing manual errors. AP automation software provides a great start, and AI and machine learning bring your O2C capabilities to the next level. These advanced technologies can help you analyze payment patterns, predict your cash flow needs, proactively manage your receivables – and more.
• Enabling faster data access: When you create a steady flow of accurate, connected information about your business' orders, bills and payments, you can make more informed decisions faster. Look for solutions that can improve your data access, report easily on financial health and give you data-driven insights so you can act quickly.
• Avoiding "application spaghetti" and streamlining your tech stack: One challenge you might face is "application spaghetti" – a fragmented tech stack with poorly integrated applications. By building an interconnected ecosystem that supports end-to-end O2C processes, you can reduce costly inefficiencies and create a smooth user experience for your team. 

Download the full white paper

For a comprehensive look at optimizing the O2C process, download our white paper "Optimizing order-to-cash at every growth stage." It provides deeper insights into the maturity model and actionable steps to advance toward an integrated, automated OTC process that helps improve your cash flow, reduce churn and support scalable growth.