Optimising financial processes

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When Working Capital is King, “Cash Fitness” and Credit Matters!

When Working Capital moves center stage, as it is currently with turbulent interest rates and raw material prices, sluggish demand in some markets, it is a great time to “sharpen the saw” with regard to cash.

“Cash Fitness” is an important discipline.

A key challenge is cash flow forecasting, predicting both anticipated payments and cash receipts. Knowing how much cash will be on hand is a key element of “Cash Fitness”.

I am honored to have been invited to one of the speakers at the excellent Credit Matters “Order to Cash” conference in October, the hub of “Cash Fitness”.

The “Order to Cash” (O2C) process sometimes starts with new customer acquisition, but generally flows from credit, quote or customer order through delivery and invoicing to collection of customer payment (accounts receivable).

Reducing the fricton in these activities and speeding the end-to-end cycle, and thus Days Sales Outstanding (DSO), improves cash on hand. For every billion in annual revenue, a DSO reduction of JUST ONE DAY is the equivalent of pulling forward nearly 3 million in cash.

Imagine what you can do with even greater achievements.

Deloitte refer to “Cash Fitness” in a useful document “Make your working capital work for you” which you can access here . . . 

McKinsey also share good tips in “Finding hidden value with order-to-cash optimization” which you can read here . . .

Progress in this area is about talent, skills, smart policies, tactics, best practices, process understanding and, yes, technology. and more.

So if you, or key members of your team, want to accelerate progress towards “Cash Fitness”, I recommend an immersion in the “WHY, WHAT and HOW” with subject matter experts and sharing/learning “what works best” for Order to Cash, Credit & Collections.

You can do this October 11-13 at Credit Matters XII in Krakow, just a short hop from your European Shared Service or Finance Operations Center. 

You can get details and register here . . .

During the next couple of months, my colleagues and I will also be speaking at Shared Services & Outsourcing Week in Las VegasAccounts Payable Association (APA) Conference & Awards in Birmingham and Shared Services & Outsourcing Week Europe in London.

Welcome to Autumn/Fall, or to Spring depending on your hemisphere!

Thanks for reading . . .