Companies should strive to optimise the order-to-cash cycle for various reasons. For starters, O2C activities impact operations throughout the organisation, including supply chain management, inventory management, and labor. Bottlenecks in one area can cause headaches for units that are completely separate.
Secondly, the invoicing and accounts receivable functions carried out during O2C determine the company’s cash inflows. Delays in collection can complicate accounts payable, payroll, potential acquisitions, and other issues related to liquidity.
Finally, managing a reliable and consistent O2C process shows that your organisation isn’t a one-trick pony. To manage the process well, you need to excel at every function of business, including sales, manufacturing, technology management, fulfillment, shipping, and accounting.