Up until a few years ago, the Finance function was primarily looking backwards through the month end close & reporting process and the provision of analytical insights into a business past performance and underlying drivers.

Recently though, the idea that Finance at large should act as a business partner within the typical corporate organization, has become prevalent. A change that requires a radical shift in the way Finance looks at the business…

Looking forward instead is indeed becoming the new norm, not just through the usual planning, budgeting & forecasting activities, but by providing leadership executives with deeper & wider insights into where the business should be going!

Likewise, the significant amount of manual work usually inherent to the lack of flexibility & agility attributed to historical accounting systems is now being challenged by the compelling need for real-time insightful reporting & analytics.

As the role of Finance – starting with that of the CFO – changes from being primarily reactive & transactional to becoming a proactive, analytical & agile function, so do talent requirements with a much bigger emphasis on data-driven analytical skills, digital tools mastery, customer service mindset & business acumen. It is therefore essential for the Finance function to re-invent itself in ways that match the evolving requirements of being a successful business in today’s world!

What’s new here for O2C Finance/Credit management?

At first glance, nothing appears to be genuinely new here. O2C Finance/Credit has always been a customer-facing function whose intrinsic mission is to partner with Sales & Operations to enable/support business, while protecting trade Receivables to minimize bad debt. As such, a professional O2C Finance/Credit function should naturally guide the business towards growing sales & margins with those segments
of the customer portfolio that are financially robust and may actually be under-leveraging their purchasing capacity.

What is new to the O2C Finance/Credit world however, is that the Covid-19 crisis had created the need for businesses to develop a proper sustainable Working Capital management strategy & manage their Cash Conversion Cycle better. As a result, the criticality of the O2C cycle had been brought to the fore like never before, and still features as a priority topic on Boards’ agendas today!

In addition, with a wide range of business-led process automation & digitisation solutions available – from payment behaviour predictive analytics all the way to automated Credit scorecards & meaningful KPIs – O2C Finance/Credit teams can free up human resources and leverage often hidden talents to spot risks vs opportunities, be innovative and deepen customer relationships, to best perform that
crucial ‘maximise revenue / minimise risk’ balancing exercise.

Over the past few years, the role of O2C Finance/Credit has been given a fantastic boost & historical opportunity to shine its critical business value-add! And this should go a long way in having O2C Finance/Credit teams eventually represented at Board level!

All in all and despite the many challenges brought by uncertainty & complexity, we are living through exciting times to be an O2C Finance/Credit professional!

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Finance OTC Consulting Limited, a Private Company Limited by Shares incorporated under registration number 667562 at the Registrar of Companies in Dublin, Ireland, with a registered office at 3 The Circle, Grange Manor, Ovens, Co. Cork