What does opportunity-to-cash mean?
Chance-to-Cash (OTC) is a business process that includes all stages of change management, from finding new leads to billing customers. It starts with the “opportunity” lead stage and covers every part of sales, from finding opportunities and leads to getting paid.
OTC’s primary goal is to ensure that every sales opportunity is managed correctly so that as much money as possible is made. At every step of this cycle, customer touchpoints must be managed. These include keeping track of contact information and information about what goods or services have been bought. This helps companies determine how happy their customers are and how well their campaigns and other projects are doing.
During the opportunity-to-cash cycle, businesses use various tools and methods to monitor opportunities, track performance, oversee projects, automate tasks when they can, boost productivity, gather accurate data, and correctly predict future opportunities. The OTC method can also help develop key performance indicators (KPIs) that people making money can use to track progress over time. Ultimately, companies can make more money and give customers a better experience at every step of the OTC process by making it run more smoothly.
One-time cash (OTC) chance-to-cash cycle opportunity management
Why optimizing the over-the-counter cycle is important
The opportunity-to-cash cycle is called the process of seeing a sales chance and making it happen from the time it is seen until payment is received. There are several perks to optimizing this cycle.
It cuts down on the length of the OTC cycle.
You need to streamline and improve the whole process to get the most out of the opportunity-to-cash loop. Businesses can reduce the time and resources needed to finish each transaction by automating tasks like entering customer data, keeping track of opportunities, and processing orders. This could lead to faster finishing times and a better experience for the customer.
Makes accuracy better
Businesses can improve accuracy by cutting down on mistakes made by hand and eliminating duplicate information by optimizing the opportunity-to-cash loop. This helps businesses keep accurate records of all deals and lowers the chance of losing money due to missed opportunities.
Gives Better Data
Businesses can get better data and insights when they optimize the OTC cycle. Companies can make choices that make the most money for them when they have accurate information about sales activities. This information can also be used to find places where things can be made even better or create new goods to bring in more money.
Get the Most Money
Lastly, optimizing this cycle helps businesses make the most money by keeping track of all chances correctly and quickly, which lets them close more deals in less time. Automated systems also make it easy for businesses to quickly find upsell or cross-sell options that can help them make more money.
Streamlining the over-the-counter process can be challenging.
Tools and resources from sales, billing, production, and fulfillment need to be brought together to make the order-to-cash process more efficient. Issues that businesses face when trying to improve over-the-counter (OTC) products are:
Getting to Up-to-Date Data
Getting correct and up-to-date data is one of the biggest problems businesses face when they try to streamline the opportunity-to-cash process. Companies may find it hard to keep track of their customers’ orders, invoice status, and payment methods when data is available from many systems, such as customer relationship management (CRM), enterprise resource management (ERP), configure price quotes (CPQ), and billing. For these departments to work together better and for over-the-counter (OTC) activities to run more smoothly, businesses need good communication tools and methods that make it easy for all teams to share data.
Putting technology to use
Finding ways to automate some parts of the cycle is another problem many businesses face when trying to streamline their cash process. It can save time and money to automate chores that used to be done by hand, like making price quotes and contracts, sending invoices, or setting up recurring payments. Automation can also help improve precision and cut down on mistakes in ordering and billing that can cost money. However, putting automated solutions in place requires significant investments in technology infrastructure. This can be too expensive for some businesses and cause problems with their workflow.
The billing system is not working well.
A poor billing system is another problem many businesses face when trying to streamline the opportunity-to-cash process. Businesses may find it hard to handle bills, payments, and collections correctly if they don’t have a billing system that works well. This can cause bills to be sent twice or not and money can be lost from late payments. For the cash cycle to go smoothly, businesses need a billing system that works and is regularly updated and maintained.
Bringing Disputes and Revenue Together
Lastly, many businesses that want to improve their opportunity-to-cash process have difficulty balancing the differences between what they were billed and paid. When disputes or cancellations happen, companies need to act and ensure that credits are adequately given so that income statements are correct. If these differences aren’t handled correctly, they could cause mistakes in recognizing income and calculating financial statements, which could have legal consequences.
Opportunity-to-Cash needs better technology to work better.
Technology is vital to shortening the time between opportunities and cash flows. Businesses can speed up their opportunity-to-cash processes by using technology. This improves accuracy, reduces manual work, and gives better data. ERP, CRM, CPQ, subscription billing, integrated accounting systems, and point-of-sale (POS) systems are some technological solutions that help businesses speed up their opportunity-to-cash processes to get paid faster. When these options work together, they give you a clear picture of the over-the-counter (OTC) cycle and its parts, which helps you predict sales and make plans.
The opportunity-to-cash cycle can be sped up with the help of automation solutions and business operations tools used in the OTC process. Business intelligence (BI) tools let you look at data to learn more about how customers act and find ways to improve the order processing process. Analytics solutions look at real-time data, from opportunities to cash flows, which helps people make smarter decisions and work more efficiently.
Machine learning (ML) and artificial intelligence (AI) can improve the customer experience by automating customer service, handling orders intelligently, and making personalized product suggestions. eCommerce systems let people buy goods and services online by giving them a digital storefront. Payment handling systems allow buyers and sellers to do business safely while lowering the risk of fraud and chargebacks. Logistics solutions, like transportation management systems, help find the best delivery paths and reduce delivery times by making accurate predictions.
