E~Credit News & Updates

February 2024

Can We Extract More Value from the O2C Cycle?

By: John Metzger, Chairman, Smyyth

The order-to-cash (O2C) cycle is a complex process involving various cross-functional activities. Despite advancements in ERP software and emerging technologies like robotic process automation (RPA) and AI, there is still room for improvement in B2B processes.

 

Companies can strategically realign their order-to-cash processes and leverage new technologies to optimize their performance and improve the bottom line. Optimization involves integrating data from business customers, automating activities, improving workflow, and analyzing deductions. By treating O2C as a unified challenge and breaking down departmental silos, companies can improve cash flow, deduction recoveries, and customer satisfaction.

The order-to-cash (O2C) cycle is a complex process involving various cross-functional activities. Despite advancements in ERP software and emerging technologies like robotic process automation (RPA) and AI, there is still room for improvement in B2B processes.

 

Companies can strategically realign their order-to-cash processes and leverage new technologies to optimize their performance and improve the bottom line. Optimization involves integrating data from business customers, automating activities, improving workflow, and analyzing deductions. By treating O2C as a unified challenge and breaking down departmental silos, companies can improve cash flow, deduction recoveries, and customer satisfaction.

  

Integrating the invoice-to-payment process is a critical aspect of O2C optimization. It involves linking stages from invoice generation and submission to validation, dispute resolution, payment processing, and reconciliation. While there may be industry-wide solutions like blockchain in the long term, current solutions involve implementing robotic (RPA) processes, leveraging bolt-on software applications, and optimizing ERP systems. Some areas in which these current solutions can be deployed are credit, accounts receivable management, collections, and deductions.

 

Credit management is a crucial aspect of the O2C cycle. B2B credit scoring and credit line monitoring help companies assess the creditworthiness of their business customers and manage credit risk. Effective credit management reduces the risk of defaults and improves slow payments. Automated credit application software has gone a long way to accelerate (and improve) new customer onboarding processes, often cutting order approvals from several days to 24 hours. The result leaves credit managers with more time to manage high-risk customers.

 

Accounts receivable (AR) management includes cash application, where incoming customer payments are matched and applied to open invoices. Traditional cash application processes can be time-consuming and prone to errors. However, software solutions can automate the cash application process using optical character recognition (OCR) technology, employing machine learning algorithms, and providing real-time adjustments based on pay terms and special conditions like tolerance write offs or early pays. By integrating with payment gateways and accounting systems, data analytics and reporting capabilities are also optimized. These enhancements streamline cash application processes, reduce errors, and improve operational efficiency to ensure cash closes quickly, disputes are handled sooner, and collectors have accurate views on true open invoices.


Collections management is another area where software can improve the efficiency of the O2C cycle. Software can automate collection tasks, handle dispute resolution, and provide reporting and productivity analytics. By integrating with accounting, third party bureau data and CRM systems, software solutions also utilize predictive analytics to identify high-priority activities and manage them through workflows, better facilitating multi-channel communication, collaboration and documentation automation. By leveraging software, businesses can enhance productivity, improve customer communication, and make informed decisions to accelerate the payment cycle and improve cash flow.

To Continue Reading

Upcoming Webinars

FEBRUARY 21

Advanced Collections And Negotiation Skills

Presenter: Barry Elms

 

MARCH 6

Conflict Resolution

Presenter: Michael Dennis

 

APRIL 17

Collection Principles, Why

We Continue To Have Debtors

Presenter: David Balovich

 

MAY 15

Smart Credit Policies That Improve Collections

Presenter: Michael Dennis

 

JUNE 19

Rolling Out A Credit Card Surcharge - Hot Topics & Best Practices

Presenter: Scott Blakeley

 

JULY 17

Overridden Credit Decisions

Presenter: Michael Dennis

 

AUGUST 21

Legal Aspects Of Credit And Collections

Presenter: David Balovich

 

SEPTEMBER 11

Acquired, Sold, Merged, Or Goes Bankrupt - What To Do

Presenter: Michael Dennis

 

OCTOBER 16

Effective Collections, The Art Of Getting Paid

Presenter: Eddy Sumar

 

NOVEMBER 20

How To Set Customer Credit Limits Correctly

Presenter: Michael Dennis

 

DECEMBER 18

Emerging Challenges In Credit And Collections

Presenter: Michael Dennis

New Contacts & Members 

New Association Member & ICE Member

Hayes Performance Systems ~ Anne Riesenberg


New Association Contact

Wisconsin Steel & Tube Corporation ~ Nate Newmeister

Neenah Foundry ~ Jennifer Mott


 New Metals & Industrial Suppliers Industry Credit Group Contact

Wisconsin Steel & Tube Corporation ~ Nate Newmeister


 New International Credit Executives Group Contact

Neenah Foundry ~ Jennifer Mott


New Construction Industry Annual Credit Group Contact

Neenah Foundry ~ Jennifer Mott


If you have something you would like us to announce please send an email to

admin@wcacredit.org

WCA-Credit-Report-Umbrella image

Every credit department relies on outside sources for credit and financial information on new & existing customers. Most orders to cash departments subscribe to one credit reporting service or another but, that may not work or be your best option. The Assocation offers a subscription plan that gives you the opportunity to choose from multiple databases, with no expiration date, no "use-em" or 'lose-em" or the need to sign contracts with multiple databases.


Contact us for more details!

To Learn More

This dynamic and informative 75-minute webinar being presented by Barry Elms, will demonstrate the skills needed to effectively negotiate with customers who have cash flow problems and find creative solutions to complex financial issues.


Highlights include:

  • Understanding the 5 elements used to gain agreement in all collections-related negotiations.
  • How to use 6 trading variables to create mutual value solutions to cash flow issues.
  • Prioritizing the 7 keys to negotiating like a pro.

LAST CHANCE!!!


Advanced Collections & Negotiation Skills


February 21, 2024

9:00 a.m. – 10:15 a.m. CT


Visit our Website

One of ICE’s most requested programs pertains to Letters of Credit. We aim to please in a big way! We understand that team players have various levels of experience with Letters of Credit. If LCs are new to you or if you need to improve your current knowledge, register today before it’s full.


This half-day program will be an excellent source of information for those who are new to LCs and/or wish to brush up on the fundamentals, or are indirectly involved with LCs and wish to have a better understanding of this longstanding and venerable trade payments instrument.


Commercial Letters of Credit

  • Parties in the LC transaction
  • Transaction flow
  • Common documents
  • Advising versus confirming (basics)
  • Discrepancies
  • Charges & who pays them
  • Sight versus Time LC’s
  • SWIFT – definition and importance
  • Role of the Freight Forwarder
  • INCOTERMS
  • Expiry issues and collections
  • Common discrepancies to avoid

 


Standby Letters of Credit

  • Bid, performance, and advance payment
  • Financial versus trade-related
  • Cancellations/Expiry
  • Affects on your company’s credit line
  • Standard cost/benchmarking

 


Don’t miss this fun and informative opportunity to learn, network, and enjoy some good food for lunch!

LAST CHANCE!!!


February 20, 2024


LETTERS OF CREDIT



9:30 AM -12:30 PM


Program Flyer
Click HERE to register.
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FEBRUARY 13, 2024

Fine Paper/Graphic Arts Industry Credit Group

Book of Reports


FEBRUARY 14, 2024

Plumbing & Heating Industry Credit Group

TBD

Regional Paper & Packaging Industry Credit Group

Teleconference Call


FEBRUARY 15, 2024

Construction Industries Credit Group

Appleton, WI


FEBRUARY16, 2024

IL Fine Paper Industry Credit Group

Teleconference Call


UPCOMING INDUSTRY CREDIT GROUP MEETINGS

February 19, 2024

Western Electrical Suppliers Industry Credit Group

Madison WI


FEBRUARY 20, 2024

Minnesota Fine Paper Credit Group

Book of Reports


FEBRUARY 21, 2024

Building & Construction Materials Credit Group

Milwaukee, WI

MN Electrical Suppliers Credit Group

 Brooklyn, MN


FEBRUARY 28, 2024

Food Service Supply Hospitality Industry Credit Group

Pewaukee, WI


NEXT MONTH

Metals & Industrial Suppliers Credit Group

Credit Professional Alliance

Credit Management Association 

The Business Credit Management Association Wisconsin

Business Credit Intelligence

Mountain States Commercial

NACS Credit Services, Inc.

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