Order to Cash and Contract Management Best Practices

Transcription

1 Order to Cash and Contract Management Best Practices Technology Toolkit 2015 Client Conference

2 About the Presenters Scott Mangelson Partner, Dynamics CRM, Armanino Scott brings 20 years of sales and marketing leadership experience, beginning in manufacturing operations. Throughout his career he has consulted and deployed ERP, CRM, and manufacturing process control software to various technology companies.

3 About the Presenters Jeff Russell Industry Practice Director, High Tech & Life Sciences, Armanino Jeff has implemented Microsoft Dynamics AX and CRM for 20+ engagements in semiconductor, electronic device, medical device, pharmaceutical and outsourced technology manufacturing environments. His professional experience ranges from manufacturing engineering, supply chain management, intellectual property, contracts law and negotiation - bringing a unique array of expertise.

4 Don t let your Order-to-Cash process feel this way

5 What We re Going to Show You What do trends in the market say? Defining order-to-cash 5 best practices / deadly sins Case studies Contract management nuances

6 Market Trends & Statistics $1 Trillion amount locked in working capital in US companies representing 7% of revenue 90% - of companies with Order-to-Cash cycle as largest asset on the balance sheet 18.29% - average Accounts Receivable (A/R) past-due rate in the US Probability of collecting past-due A/R: o 3 month o 6 month o 1 year 40:1 cost of dispute resolution/collections vs. pre-term prevention

7 Market Trends & Statistics Best-in-class vs. Laggards o 75% faster invoice processing o 80% improvement in # of Full Time Equivalents (FTEs) to manage sales order / invoice / collections o 5X as many early-payment discounts captured o 4X utilize fully-integrated Customer Relationship Management (CRM)/Enterprise Resource Planning (ERP)

8 Market Trends & Statistics Gartner survey of Order to Cash (O2C) challenges o Multiple/incompatible systems o Decentralized, informal, or manual processes o Inaccurate invoices o Lack of critical information to identify key metrics, issues, risks, & actions o Resource constraints

9 O2C OTC What is Order-to-Cash? Enquiries / Leads & Opportunities / RFQs Quotations Sales Orders Contract Management Deliver Billing & Collections Service Order entry / creation Planning / scheduling Pick, Pack Ship Customer receipt Customer Invoice Receive Cash Payment / Credits Rebates Returns Warranty & Repair

10 Top 5 Best Practice Challenges For the Modern Enterprise 2015 Client Conference

11 Single Source of the Truth Removing redundancies Improved audit trails / compliance Faster responsiveness internally & externally Alleviating tribal knowledge Better decision-making

12 Case Study Single Source of Truth Ikanos Challenge Legacy ERP system No CRM System Lots of spreadsheets Limited forecast management visibility Solution: ERP CRM Armanino Forecast Management Benefit One Single Master Data Management architecture Every data source had one system of record Aligned the data integration to ensure all users had visibility

13 Business Users Living and Breathing in One Unified System More collaboration o Departments o Business units o Corporate entities Improved efficiency in day-to-day Faster onboarding Better retention Less overhead re: communications Lower total Cost of Ownership

14 Case Study TeraRecon Challenge Legacy ERP system No CRM System Poor order management visibility Limited collaboration between teams and departments Solution: ERP CRM Benefit One unified enterprise application solution Familiar, easy to use system Improved business process efficiency Much lower total cost of ownership

15 Flexible and Powerful Architectural Design Multiple pricing/fulfillment options must be supported Adapt with the fabric of the market agility and flexibility paramount 1 size does not fit all o Different geographies o Different regulations/tax o Different client/customer needs o Changes over time As-is + To-be business process

16 Case Study Microsemi Challenge Grew by acquisition, 27 in 10 years. Many different ERP systems No single CRM system, 5 options Disconnected systems and business process Benefit Flexible Quoting and RFQ process Unified visibility of sales orders, shipments, and invoicing Adaptable and scalable as business changes and more companies are acquired Available-to-promise (ATP) / Capable-to-promise (CTP) on order-intake with fast commitment Solution: ERP CRM Order Management Control Center

17 Credit Management Tightly connected to sales and delivery o Establishing credit limits o Late payment influence o Visibility Multi-entity customers / consolidated credit analysis Sales reps alerts/dashboards o Proactive vs. reactive

18 Case Study Undisclosed Enterprise Electronics Co. Challenge Multi-entity customers De-centralized sales/customer service Highly competitive (i.e. 24-hr order turnaround) Write-offs Solution: ERP CRM Reverse Logistics for CRM Benefit Consolidated and comprehensive credit management processes o Credit thresholds more accurate o Evaluation across multi-entity customers o Less hindrance on new sales where appropriate

19 Leveraging Workflows Cross Departmental Collaboration Speedy execution Monitoring process bottlenecks o Delegation o Additional resources o Revised business process Tighter controls o Discounts o Compliance Auditable

20 Case Study MaxLinear Challenge Installed ERP system No CRM System Limited visibility to forecasting and thus a challenge to forecast orders and invoicing. Billings Bookings, and Backlog (BBB) were not being effectively netted from forecast. Solution: ERP CRM Design Win and Forecast Management Benefit A single system across sales and operations to plan and forecast the order management process Sales, Quotes and Forecasts in CRM with Orders, Invoices, to track BBB in ERP. Fully automated business process with alerts, etc.

21 A Word About Contract Management for OTC Specific to sales and order process Tracks sales order differences o Discounts o Delivery schedules o Promotions and trade support o Special payment terms Tied to orders and invoices for execution Improves customer service Operational efficiency o Removes manual tracking and rework

22 Case Study Regal-Beloit Warranty Management Challenge End of Life Baan ERP system for Warranty Management and Product Repair No CRM System Needed a robust contract management and renewal system for warranties Process to control product repair and service Benefit Industry Specific solution for managing warranty contracts Supports renewals, pricing, and quoting of warranties Easy to user Returns Material Authorization (RMA), warranty cost tracking, and field service. Solution: CRM Armanino Warranty Management

23 Top 6 Considerations Recommendations to Manage and Optimize the Order to Cash & Contract Management Process 1. A single source of truth 2. A unified enterprise application 3. Flexible architectural design to support change 4. Support for credit management 5. Leverage workflow and process automation 6. Utilize contract management where appropriate

24 What Questions Do You Have?

25 Scott Mangelson phone: Jeffrey J. Russell phone: Client Conference

26 COMING UP NEXT: Managing Deferred Revenue in the Cloud 2015 Client Conference