Shining a light on e orders for O2C automation

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e orders e-orders O2C automation order to cash

Why e orders can result in establishing customer relationships 80% faster

Since its inception in the 70’s we have heard a lot about e-invoicing and the benefits that ‘going electronic’ can bring to a business. Somehow though e-orders and O2C automation (order to cash) haven’t been given the same attention, and I, for one, think it’s time that changed. So, let’s turn the spotlight on to e-orders.

Moving to an e-ordering system can bring significant benefits to an organisation, the financial savings alone can be incentive enough but the benefits are much wider than that. Hang on though, I am getting ahead of myself.

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What does traditional ordering look like and how do e-orders and O2C automation work?

Well, we know that the lack of integrated front-end, customer facing systems (i.e. e-commerce and multi-channel enabled systems) with up-to-date order-fulfilment-delivery processes are the main reasons for lost sales opportunities, lower gross margin return on investment (GMROI) and lower customer satisfaction rates.

So, for suppliers /vendors, who receive orders via multiple channels (web shop, branch, rep, email, fax, paper etc.) and who are working across different sales and fulfilment systems with manual data entry from one to another – we know it’s a headache. Capturing the sales data to be able to fulfil and despatch the order not only takes time, but also result in human processing errors, which cost the business time and money to fix, and negatively impact customer satisfaction levels.   

Let’s be honest, what we really want to do is be able to raise an invoice as quickly as possible and we can only do this once we have fulfilled the order and despatched the goods, so why aren’t more sales ‘back office’ processes’ automated because we know that streamlining processes speeds up processing times and reduces errors, which means cost savings, better customer satisfaction and immediate invoice revenue.

The order process

Let’s just think about the ordering process; it does vary by customer but largely it will look something like:

  • You decide what you need to buy by looking at online catalogues or even paper catalogues (Yes, really, even in today’s “modern” society paper still hangs around to an alarming extent)
  • You place an order – this could be via a website, email, fax, or phone. For large customers, it is typical to have this automated and driven by the back-office inventory demand system which place the order within their own system; this order is then sent out via email, fax, or paper to the supplier.
  • The order is processed by the supplier / vendor - and this is perhaps the most surprising bit - even where orders have been made online, this part of the process can still involve manual data entry from the web form to the order system. And of course, orders via email, fax and phone all need to be manually entered.
  • The order is fulfilled and invoiced – again these steps often require manual data entry in to different systems to complete the sale.
  • It’s clear that there are so many inefficient steps in the process!

E-order systems are really complicated, aren’t they?

To be fair, some e-order and O2C automation systems are complicated. But they needn’t be. For example, email is used extensively by most companies. An e order system based on email, where buyers send PDF orders via email is already commonplace.

However, many suppliers must then manually key the data from the PDF in to their own order system. With the right technology though the data within the PDF can be automatically processed without any human intervention, and this brings significant benefits without the need for any big technology infrastructure overhaul. 

In fact, using this simple approach to e-orders, Hilti (a leading construction products and equipment manufacturer and supplier) reduced the time taken to establish e-business arrangements by over 80%, at no cost to customers, and made overhead savings on its administration of purchase orders and other processes. 

Get the full Hilti case study here

In fact, it’s often easier to use a third-party system to receive and process your orders, as it offers a lot more flexibility and can deliver the data in a format that your host sales order processing needs -  using the standard pre-configured inbound order formats; to make a change to established software is often cost prohibitive and never sits well with the IT team.

For others, use of a marketplace or customer centric portal that enables a company to work electronically with all its business partners is also an option; but again, this requires a large investment in time and money and a more strategic approach that aligns to your sales strategy.

The time to automate is now

It’s time that companies started taking e-orders seriously and started automating them. Whether it’s a simple, or more complex, integrated solution, it will deliver slicker processes, fewer errors, substantial cost savings, and more importantly for your cash flow a real impact to your bottom line.

E-orders can deliver companies just as many benefits across the business as e-invoicing; it’s a vital step in an automated process that is often overlooked because ‘we have always done it this way’, so shouldn’t you be helping your sales administration teams focus on working with your customers rather than inputting their orders?

No longer should e-ordering be lurking in the shadows; now is its time to shine.

This article was published by Recieveable Savvy and Sharespace.

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