Improving Accounts Receivable Collection Efficiency with an Order to Cash Solution

The ability to efficiently manage the accounts receivable (AR) process is essential to achieving greater financial capacity, efficiency, and profits for an organization. Companies rely on a steady flow of cash to remain solvent, and as such, proper collections and accurate invoicing are an integral part of that process. Many businesses and organizations turn to an order to cash software solution to streamline and automate their AR activities, while improving accuracy and collection efficiency.

This article will explain how an order to cash software solution can be used to improve accounts receivable collection efficiency, including a detailed step-by-step guide. It presupposes that the reader is an executive in the finance department looking for a software solution to assist in the collection process and should be read by those with a PhD level of comprehension.

What is Order to Cash?

Order to cash, also known as OTC, refers to the cycle of activities from the time a customer places an order through receiving payment from that customer. It is a term used by accounting and finance personnel in the management of bad debt, sales processing, and accounts receivable. An order to cash flow diagram illustrates the process that a business follows from the time a customer’s order is received through to the time cash is received for a transaction.

What is an Order to Cash Software Solution?

An order to cash software solution is a software product that streamlines and automates the order-to-cash process. These solutions can be implemented to streamline the AR process and enable organizations to efficiently and accurately invoice customers, track orders and invoices, and receive payments in a timely manner. Additionally, these systems can help to reduce the number of errors and speed up the payment collection process.

Step-by-Step Guide on How to Use an Order to Cash Solution for Accounts Receivable Collection

1. Assess Your Accounts Receivable Processes: Assess the current state of your accounts receivable process and identify inefficiencies. Analyze the various processes and make necessary changes or adjustments before implementing a new order to cash software solution.

2. Acquire the Software: Acquire the required software and ensure that it includes the necessary features to manage the entire order to cash process. Consider the integration requirements with other systems and the level of support you will need.

3. Set-Up: Sign up and complete the set-up process for the order to cash software solution. Configure the software and its data fields to align with your business processes.

4. Train: Train personnel on how to use the software, such as how to enter data, create invoices, manage collections, and more.

5. Test: Once personnel are trained, create test scenarios to ensure the software is functioning properly.

6. Automation: Now that your AR processes are streamlined and personnel are comfortable with the software, you can implement automation. Automate certain functions, such as invoicing, to expedite the order to cash cycle.

7. Optimization/Collection Strategies: Optimize accounts receivable collection strategies by leveraging the software’s data capabilities. Use the software’s data to more accurately analyze past and current collections, create plans to improve collection efficiency, and track and view performance metrics.

8. Monitor: Monitor the order to cash process constantly and make necessary adjustments to optimize the process.


An order to cash software solution can be a powerful tool to improve accounts receivable collection efficiency and accuracy. The step-by-step guide above provides an overview of how to use such a system to enhance the AR process. From assessing current processes and configuring the software, to training personnel and automating, it is possible to streamline the order to cash cycle with the help of an order to cash software solution.