Optimizing Order To Cash Processes With Intelligent Cash APplications


Cash application will never be the same after deploying B2B intelligent cash application solution created with the order-to-cash (OTC) process in mind. Automating and taking holistic approach to OTC while utilizing machine learning to identify, measure, and improve existing cash application processes is the key to unlocking unprecedented performance and unlocking new streams of revenue.

Organizations have strived to improve the OTC process despite managerial, operational, and data-oriented delays. The inroads made have been mainly iterative, limited successes have been spread out. This article is designed to demystify intelligent cash application and provide an overview of the value, process, and software required to overhaul inefficient and costly OTC processes transformed into an automated efficient and effective system.

Introduction to Intelligent Cash ApplicationsOrder to cash (OTC) process improves when financial organizations have the visibility, control, and automation needed to drive earnings performance throughout the process. It is combination of finance, process, and automation efforts that are created in order to allow business to receive customer payments smoothly and efficiently. By employing an intelligent cash application solution, organizations can leverage powerful machine learning algorithms to unlock new value and unlock opportunities not fully realized with existing manual and traditional approaches.

Intelligent cash application utilizes artificial intelligence and machine learning to allow organizations to automatically map customer transactions to existing customer accounts. This automated mapping process allows organizations to streamline customer payment processes, identify and fix exceptions and reduce manual reconciliation efforts.

Benefits of Automating the Process The most obvious benefits of such cash applications include increased working capital efficiency and improved control of the reconciliation process. It goes further than that, however when organizations deploy intelligent cash application process, there are several other benefits for the organization, including:

? Improved Customer Experience Customers reap the benefits of streamlined process, speedier invoice payment processing, and more accurate billing.? Achieving Global Cash Visibility It is easy to get an overview of cash flow, plus the ability to identify and measure opportunities across the entire organizations customer accounts.? Enhanced Relationship with Suppliers Companies can establish trust with suppliers with customers faster payoffs for early payments after deploying intelligent cash applications.? Reduced Operational Risks Qualitative and quantitative signals alert the user when manual process act is taking place and give the user the opportunity to intervene and resolve the issue.? Increased Automation Automation eliminates manual effort while maintaining compliance with internal and external policies and procedures.

The Process: Pivoting from Manual to Automated Cash ApplicationsDeploying intelligent cash application solution begins with the pivot away from manual data entry and manual investigation and escalations. This means replacing the cumbersome process of manually selecting and reconciling customer payments to useful, automated system that feeds the necessary information into the companies financial systems.

First and foremost, organizations need to identify and nurture the data entries required for manual mapping. Once identified, data must be segmented into individual segments for accurate categorization and process automation. After full identification and segmentation, processes will be built to automatically recognize customer payments and record them against customer accounts. These mapping processes need to be maintained over time to ensure accuracy, be constantly monitored for exceptions, and adjusted for new customer payment methods.

Once the processes are set up, organizations should develop data-governance process to ensure accurate and reliable data is captured and applied to customers. This data-governance process should actively monitor, store, and report on customer payment records and adjustments/exceptions.

Finally, after setting up the processes and data governance, organizations must also develop metrics and analysis to precisely calculate the organizations automation and improved processes. This includes metrics around working capital that measure key aspects such as Days Sales Outstanding (DSO) and Days Payable Outstanding (DPO).

The Software: Optimizing the OTC ProcessThe software required to power intelligent cash application solutions is equally important as the processes. Without it, organizations would struggle to establish and automate, improve their processes across all customer accounts, and identify opportunities and exceptions in real-time.

High-quality software should include the following features:

? Pre-built templates, mappings, and reports that allow for quick integration.? An automated reconciliation solution that allows for segmentation, mapping, and refreshes for accuracy.? online user interface that provides dashboard view of customer accounts and opportunities and actionable insights.? Data processing architecture that allows for extraction, transformation, and loading (ETL) of customer payments into the organizations financial systems.? Intelligent routing and exception management capabilities to automatically detect and prioritize customer payment exceptions.? Robust analytics engine that allows for real-time generation of reports and uncovering trends quickly.

Conclusion The OTC process presents an ongoing challenge for organizations. To unlock new value and unlock opportunities, organizations have to focus on the process, data governance, and software required for intelligent cash application solution. Automating and taking holistic approach to OTC while utilizing machine learning to identify, measure, and improve existing cash application processes is the key to unlocking unprecedented performance and unlocking new streams of revenue. Organizations that are successful in deploying intelligent cash application platform will find themselves with competitively positioned tool and seeing more predictable cash flows.