O2C Process Improvement

Our client is a global provider of innovative supply chain solutions for companies in the aerospace, defense, manufacturing, and pharmaceutical industries.  As part of a recent merger, the company has had difficulties efficiently running its Order to Cash (“O2C”) process and collecting from its clients.  The NPNA team was engaged to perform a 4-week assessment of our client’s O2C process and design a future state process based on the proposed solutions.

Client Challenges

• Ran 2 different O2C processes under different ERPs after the merger

• Over 35% of total AR was past due 

• A significant portion of past-due AR had been classified as non-collectible

• No Return Merchandise Authorization ("RMA") process was in place or being executed

• New shared services center for sales and customer service lacked expertise

• Sales continued to grow… so did past-due AR

How NPNA Added Value

We accompanied our client through the process of identifying the root causes of their collection issues and designed a future state O2C process that resolves their issues without requiring a complete technology overhaul.  We accomplished this result by taking a comprehensive look at their O2C process, gathering insights from more than 50 stakeholders in different territories, and bringing to each conversation our experience and leading practices.  Following NPNA’s Transformation Management methodology, we nurtured a constant and open channel of communication with all stakeholders, earning their trust and support.

Execution Strategy:  Designed the appropriate O2C process improvement execution strategy, identifying the initiatives that needed to take place to ensure the correct set-up. 

• Identified stakeholders and process owners

• Gauged the organization’s change culture

• Defined ideal communication channels

• Provided the client with guidance for its governance structure 

• Ideated the root cause hypotheses for the O2C process issues​

Set-Up: 

Ensured that the client was ready to begin its transformation efforts by defining its stakeholders, milestones, work sprints, and risks.

• Drove kickoff session with stakeholders

• Performed in-person walkthrough of the current O2C process

• Defined comprehensive work sprints

• Scheduled interviews and workshops with stakeholders

Execute:  Identified solutions to the client's O2C process issues.

• Analyzed AR data to identify the reasons for past-due AR

• Held over 50 in-depth sessions to determine pain points & solutions

• Mapped the client O2C process in its current state 

• Determined pinpoint solution for each root cause problem

• Determined and prioritized solutions for each pain point.

• Validated proposed solutions with stakeholders

• Identified individuals responsible for key activities in the O2C process and mapped out initiative timeline

• Mapped future state O2C process with implemented solutions

• Developed O2C Transformation Roadmap detailing timing, milestones, estimated cause, and responsible parties.

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Results

NPNA identified solutions to the client's issues and developed a roadmap to accomplish an efficient O2C process. The client has taken responsibility for executing the O2C process transformation. NPNA remains engaged with this company, helping in other important transformation initiatives.

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