logging in or signing up What is the Order To Cash Process?_OTCNF ASUGPM1 Download Post to : URL : Related Presentations : Share Add to Flag Embed Email Send to Blogs and Networks Add to Channel Uploaded from authorPOINT lite Insert YouTube videos in PowerPont slides with aS Desktop Copy embed code: Embed: Flash iPad Copy Does not support media & animations WordPress Embed Customize Embed URL: Copy Thumbnail: Copy The presentation is successfully added In Your Favorites. Views: 1773 Category: Education License: All Rights Reserved Like it (2) Dislike it (0) Added: January 16, 2011 This Presentation is Public Favorites: 1 Presentation Description No description available. Comments Posting comment... Premium member Presentation Transcript Quote / Order To Cash : Quote / Order To Cash John Choate – National Chair Marianne Murphy – Program Chair Program Management & Maintenance Strategies (PMMS) SIG What is Order To Cash ? : What is Order To Cash ? Order to Cash normally refers to the Enterprise Resource Planning (ERP) process in which taking customer sales (direct from the customer ) orders via different sales channels, such as email, internet, sales person, fax or by some other means like EDI, and then fulfilling the order, shipping, logistic and then generating an invoice and collecting payment for that invoice and then receipt. CASH IS KING ! It is also the lifeblood of any company and it flows through the order-to-cash cycle. AREAS AFFECTED BY OTC CYCLE : AREAS AFFECTED BY OTC CYCLE Customers Order entry (Order) Customer service Distribution Operations Sales and marketing Finance and accounting Customers (Cash) Order To Cash Process : Order To Cash Process Quotation (RFQ) Sales Order with quotation reference Product Allocation Credit Limit Check Service charges Bill of Material (BOM) Order To Cash Process : Order To Cash Process Delivery Picking with automatic transfer order creation and confirmation Picking with manual transfer order creation Confirmation Packing Posting goods issue Invoice Payment by Customer (Cash) “ORDER TO CASH” KEY SUB-PROCESSES : “ORDER TO CASH” KEY SUB-PROCESSES Customer presence Order entry (creation of order/booking of order ) Order fulfillment (physical & digital fulfillment) Distribution Invoicing Customer payments/collection Cash Application Receipt Simple Business View – Order to Cash : Simple Business View – Order to Cash BROKEN Order To Cash Process Symptoms : BROKEN Order To Cash Process Symptoms High order-taking error rates High order-fulfillment error rates High DSO (Days Sales Outstanding) rates High cost of dispute resolutions Inefficient/ineffective collection processes Long-term losses due to customers going to better managed companies for product/services Slide 9: Pressures: External forces that impact an organization’s market position, competitiveness, or business operations (e.g., economic, regulatory, technology, competitive, etc.) Actions: The strategic approaches that an organization takes in response to industry pressures (e.g. product/service strategy, target markets, go-to-market, and sales strategy) Capabilities: The business process competencies required to execute corporate strategy (e.g., skilled people, brand, market positioning, viable products/services, financing, etc.) Enablers: The key technology/solutions required to sup-port the organization’s business practices (e.g. development platform, applications, connectivity, user interface, training and support, etc.) Note: Aberdeen utilizes a proprietary research framework called PACE to systematically and objectively develop its research findings. PACE Framework Applied To Order To Cash : PACE Framework Applied To Order To Cash Pressures (P): Reduce overall costs Actions (A): Streamline front and back office administrative processes to remove non-value add steps. Automate process flows with electronic workflow technologies. Source: Aberdeen Group PACE Framework : PACE Framework Capabilities (C): Standardized enterprise-wide procedures through quotation to order, order to delivery, and credit/cash collection. Up-to-date order, delivery, and billing information is available in real time, on demand. Manufacturing and/or service operations are integrated and coordinated with customer service, logistics, and delivery organizations. Real time measurement of on-time delivery, inventory, DSO, profitability, and cash position. Source: Aberdeen Group PACE Framework : PACE Framework Enablers (E): ERP - integrated order entry, procurement, production/resource planning and execution, and financial management Event management (triggers and alerts) Electronic interfaces to banks and customers Web-based and electronic sales order management application Credit management solution Electronic Invoice Presentation and Payment solution ERP features or extensions: Customer Relationship Management (CRM) Advanced Planning and Scheduling (APS) Available to Promise (ATP) Source: Aberdeen Group Key Metric’s For OTC Process : Key Metric’s For OTC Process Quotation and Sales Order (SO) Management Aging Order Fulfillment Period On Time Delivery (OTD) - % Perfect Order Finance/Accounting Invoice Payments Collections Performance Results : Performance Results Industry Best-in-Class - Top 20% 31% improvement in order-to-fulfill cycle time 97% complete and on-time shipments 34 DSO 2.6 days from completion of product/work to invoicing Industry Average - Middle 50% 15% improvement in order-to-fulfill cycle time 88% complete and on-time shipments 48 DSO 3.9 days from completion of product/work to invoicing Source: Aberdeen Group Performance Results : Performance Results Laggard - Bottom 30% 9% improvement in order-to-fulfill cycle time 83% complete and on-time shipments 58 DSO 6.1 days from completion of product/work to invoicing Source: Aberdeen Group October 2010 Key Recap Items : Key Recap Items Why is Order To CASH so important? What organizations are key to the process? What are symptoms of a broken process? What is PACE? Name 2 metric’s for the OTC process. Where is your company in ranking ? Best-in-Class Standard Laggard Slide 17: 17 ] Thank you for participating. PMMS SIG You do not have the permission to view this presentation. In order to view it, please contact the author of the presentation.