Aberdeen surveyed 140 participants from organizations around the world for the study. Within this group, Aberdeen defined Best-in-Class corporations as having 71% lower past due accounts receivables (A/R); 80% faster payment clearing times; and 70% lower invoice volumes requiring manual interventionâwhen compared to corporations that are not Best-in-Class. Aberdeen attributes this trend in part to Best-in-Class corporations being 2.9-times as likely to automate major steps of the order-to-cash cycle when compared to all other corporations. Organizations can help minimize labor costs, reduce days sales outstanding (DSO) and foster process efficiencies by introducing strategic workflow, and intuitive functionality for routing disputed transactions.
Scott Pezza, senior associate at Aberdeen Group, said, âAlthough the economic environment has shown signs of recovery, the focus on reducing operational costs remains at the forefront of most corporationsâ agendas. In fact, the majority of survey participants at 67% reported reducing overall cost as the major pressure steering improvements in the order-to-cash cycle. Inflated costs related to manual and inefficient processes continue to play a large part in draining cash. As a result, more Best-in-Class organizations are automating processes surrounding the order-to-cash cycle, which is helping them to successfully drive these costs downward.â
Jim Mangano, senior vice president of receivables solutions for SunGardâs AvantGard business unit, said, âBest-in-Class companies using order-to-cash automation can help unlock the hidden value in their receivables by eliminating manual processes, and exposing cash once tied up in covering debt related to late or missing payments. Corporations that take it one step further by incorporating regular scoring of the A/R portfolio can help further decrease the number of past due receivables. Evaluating customer risk profiles can be a valuable part of establishing appropriate credit risk limits, as well as helping improve overall recovery efforts through establishing more individualized collections strategies.â
SunGard recently hosted the Webinar, The Order-to-Cash Cycle: Enhancing Performance with Process Automation. The Webinar presented the results of the study, and also included a panel of corporate practitioners who shared best practices.