Nearshore Americas

OTC in Industry 4.0: Why You Should Focus on the Customer Journey

One of the business areas that has most potential for improvement and transformation is the Order to Cash cycle, (O2C or OtC as it is usually referred to). This is the process or group of processes that follow the sales process, from when the customer or sales rep places the order of a new product or service going though how that order becomes an invoice, how that invoice converts into a delivery of what was bought (the delivery could be electronic or physical and each has variances in the processes), how that delivery becomes an account receivable in the accounting and finally, how payment is received and “cash” is applied to the pending AR.

Of course, variances depend much on the products or services being delivered. There may be some complexities, like when invoicing has embedded an electronic invoice process with the tax authorities in some geographies, as well as differences in the “last mile” of the process, when collecting.

In Latin America, the payment process is much less digital than in other locations and this creates variances per country that must come eventually into one common connection into the more standard processes. I’ve had the experience in locations where this last mile is completely manual and who receives the payment is a messenger that collects a check or even cash and handles a manual receipt, handwritten.

So, the main expectation of every company nowadays is to be able to harness the power of digital transformation 4.0 and automate all those manual tasks into one standard process that will optimize KPIs, reduce DSO and late payments, improve how collectors collect or how customers pay in a way that would lower costs and make them more competitive.

The technology today allows us to do things that we could only imagine 10 years ago, and at a very low price too. The advent of Cloud applications and platforms, as well as the development of smartphones combined with the penetration of those smartphones into the daily lives of practically everyone, makes today’s process improvement environment a very different landscape to the one we had a few years ago.

But, amidst all this new technological capabilities, and the ones coming, there could be a risk of focusing too much on what is possible with technology, and not paying enough attention to the customer experience and what is of value to the client or customer if you are in retail.

All these new technologies – RPA, AI, workflows, payment gateways and their extensions to the IoT (Internet of Things) world – must be looked at through the lens of the customer and client. Whoever is in charge of improving processes must make sure that what’s done improves the customer journey when going through that process. I cannot stress enough how important is to ask yourself constantly:

  • What are the pain points of the customer and how much of what you are doing is aimed directly at those pain points?
  • What do you not offer, but represents an aspirational feature of the customer journey, i.e. something the client is not expecting to see in your process, but would be delighted to find, however unexpected?
  • If you are working on changes to the process that would take a long time to enable (6+ months), do you have a plan for a parallel shorter route to provide at least partially, some benefits in a shorter period of time, so that the customer starts enjoying the changes sooner?

And finally, most important of all:

  • Are you assuming from your own interpretation the three answers above or do you have some hard data or direct data from the customer that lead to your conclusions? This is very important, because all your efforts might not be appreciated at the end, unless the client (B2B) or customer (retail) perceives and values your contribution to the process.

Most certainly, you do not have just one client, you actually have several stakeholders and whatever you are doing to improve your O2C process has different views from different stakeholder angles for what is the value of the improvement. Be sure to map all those expectations clearly and hopefully, directly from the customer.

I frequently use a very simple visual tool called the “Kano Model” which is used to depict graphically the expectations of the end customer or the client. The general ideal is that there are features or characteristics of a product or service that do not produce satisfaction. If they are present, the customer feels they are part of the bare minimum, and they are dissatisfied if the feature is not present or not working. These are below the green line in the Kano diagram.


Source: Wikipedia Definition of Kano Model

In contrast, there are some features that the client does not expect and if found, he/she feels delighted, because it is a very pleasant surprise and causes satisfaction. This is depicted by the strong red line in the upper part of the graph. In between, represented by the light blue line, are the features that the client recognizes that have different performance or appearance levels and the more there is, the more satisfaction it will produce. This is where company performance is usually focused and improvement opportunities frequently are focused on improving those features.

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The theory behind the Kano Model is that the customer/client will not perceive satisfaction on the performance needs or the delighters unless you have covered all your bases with the Basic Needs. And the Delighter features, as they become more frequent, move down the model until they become basic needs.

A typical example of this is the Internet connection at hotels. Fifteen years ago it was great if a hotel had Wi-Fi in the lobby, however slow it might be. Then we came to expect that the Wi-Fi would reach the rooms, so that we could have our conference calls in our rooms and stay late revising emails. Nowadays, if you don’t have hi-speed Internet in the room, and free, you won’t go back to that hotel anymore. So the same feature has navigated from a delighter to a basic need in just a few years.

So, back to our topic with O2C digital transformation: Do you have mapped with certainty what your customer’s basic needs from an improvement standpoint are? Are you certain? Doing this check frequently will mitigate the risk of you working and devoting time on something that the client would not value. Make sure your O2C digital transformation is focused on what matters.

Otto Acuna

Otto Acuna is an Internationally Certified Management Consultant that helps organizations to work better through strategy, operational improvement and digital transformation.

He is the Founder and CEO of e-Consulting Global Solutions OÜ, an Estonian company that help consultancies utilize the latest methodological and technological resources to serve their clients. E-CGS was designed as a fully digital organization that combine the capabilities of the most digitized society in the world with the drive for sustainability and vision of Costa Rica, in the Americas, where Otto resides.

He has over 20 years of experience both as a professional management consultant and working in functional leadership positions in companies, always associated to business improvement, human resources and finance. Otto is the first CMC-Certified Consultant in the Spanish Latin America region. He is also an ISO 20700 Trainer for the CMC-Global Institute.

He is currently volunteering as the Chairperson for the CMC-Global Institute - the International Council of Management Consulting Institutes, the global organization which creates the standards and regulates the management consulting profession in more than 50 countries and territories. He also serves as Lead Assessor for the Quality Assurance Committee, where he supports the triennial audit of management consulting institutes worldwide.

As of 2023, Otto and e-CGS support consultancies in Canada, the US, Costa Rica, Egypt, Mongolia and Kenya, as part of its expansion into emerging markets. You can contact Otto by email or or LinkedIn.

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