A company is a collection of processes. And, these processes exist in support of a company’s ‘Quote to Cash’ process.
A few days ago, Terry Schurter and I were having coffee discussing the ‘Quote to Cash’ process. He pointed out that you can look at the ‘Quote to Cash’ process from 3 different points of view – from a cash flow perspective; from the human activities perspective; and from the customer’s perspective.
I do think that he hit on something important. If you intend to ‘improve’ or even ‘manage’ your ‘Quote to Cash’ process, I think you must look at the process from each of these points of view.
Cash Flow perspective – Last week, I looked at the ‘Quote to Cash’ process from the cash flow perspective. I quoted a national leader in Receivables Cycle Management. Certainly, their view was all about cash flow.
Human Activities perspective – Within any process, including the ‘Quote to Cash’ process, there are activities that workers perform that make it all happen. This is where you may identify non-value added activities that can be eliminated. This is where you begin to recognize other processes that add value to your ‘Quote to Cash’ process.
Customer’s perspective – Your customers do interact with your ‘Quote to Cash’ process. At a minimum, they start the order and receive the goods or services. If it is not easy to do business with your company, you may not keep this customer. And, there have been many studies showing that it is easier to do business with an existing customer than to find a new customer.
Some questions that you might want to think about…
Have you diagrammed your ‘Quote to Cash’ process? Are your receivables longer than 45 days old? Are all of the human activities clearly defined so that the process runs smoothly? Can you identify the processes that add value to the ‘Quote to Cash’ process? What do your customer’s think of your process?