The Order-to-Cash (O2C) process represents the entire journey of a customer order, from the initial sale to the final payment receipt. It is the operational lifeblood of a company that directly impacts revenue, cash flow, and customer satisfaction. For businesses running on NetSuite, the goal is to make O2C a seamless, automated cycle.
However, this critical workflow is often undermined by hidden inefficiencies that drain resources, delay cash flow, and create internal friction. These issues primarily manifest in two areas: flawed inter-departmental handoffs and pervasive data inconsistencies. In conversation with ERP Today, Aradhana Sahdev, NetSuite Administrator at CloudPaths in their SuitePaths practice, notes that understanding these friction points is the first step toward building a more resilient and efficient revenue operation.
A Transitional Failure
A common and significant point of failure occurs during the transition of information and responsibility between teams. Sahdev compares this to a relay race where a clumsy baton pass can ruin the entire effort. While orders are eventually processed and invoices are sent, the underlying bottlenecks, such as minor delays and manual checks at each stage, accumulate and go unnoticed.
“One of the most overlooked friction points in the O2C cycle is primarily the handoff between departments, especially from sales to finance to fulfillment,” states Sahdev. This lack of operational visibility means that companies often assume their processes are effective simply because the final output, such as an invoice, is generated. They fail to identify where delays in fulfillment, credit approval, or order processing occur, resulting in a reactive, problem-solving environment instead of a proactive, streamlined one.
Compounding the challenge of flawed handoffs is the integrity of the system’s data. An ERP is only as powerful as the data it contains. When information is inaccurate, inconsistent, or incomplete, it acts like sand in the gears of the O2C machine, causing process delays and requiring significant manual intervention to correct.
As Sahdev highlights: “Mismatched customer terms, item pricing, or approval rules that slow down billing and cash application are not minor clerical errors; they have a direct and costly domino effect.”
Mitigating Issues in O2C
Moreover, an incorrect price on a sales order results in a wrong invoice, which in turn causes a customer dispute, a credit memo, and a delayed payment. This consumes valuable time of the finance and customer service teams. “Within NetSuite, these issues can be systematically mitigated by refining workflows, enforcing data standards, and using analytics to flag exceptions before they escalate into significant revenue delays,” Sahdev says.
In the second part of our conversation with Sahdev, we extend this analysis to explore how a proactive maintenance strategy can systematically resolve these issues and align the NetSuite environment with long-term business objectives.
What This Means for ERP Insiders
Analyze inter-departmental handoffs. The efficiency of the O2C cycle depends on the seamless transfer of information between sales, finance, and fulfillment. It is critical to map these workflows to identify where manual follow-ups are required. Collaborate with NetSuite partners like CloudPaths to implement NetSuite’s native SuiteFlow tool to automate notifications and approval routing, creating a more reliable and transparent process that doesn’t depend on email.
Implement proactive exception monitoring. Instead of reacting to problems after they’ve impacted a customer, use NetSuite’s native tools to anticipate them. Leverage real-time dashboards and SuiteAnalytics with CloudPaths to create custom reports and saved searches, which, according to Sahdev, surface exceptions before they become revenue delays. This allows teams to identify orders with mismatched data, credit holds, or approval bottlenecks and resolve them before they affect billing.
Establish strict data governance protocols. Inconsistent data is a primary source of billing and cash application slowdowns. As Sahdev emphasizes, to resolve this, it is essential to tighten workflows and enforce data entry standards within NetSuite. Use roles, permissions, and custom forms to control the creation and modification of critical records like customer terms and item pricing, ensuring data integrity across the entire O2C cycle.
