Transforming O2C into a Strategic Growth Engine

Rethinking the order-to-cash process might be the most important move you make this year.

 

Why? PYMNTS reports that only 5% of mid-size firms have fully automated their accounts receivable processes. This leads to inefficiencies and liquidity risks, which also affect working capital, straining customer relationships, and undermining the accuracy of financial forecasts.

 

At the same time, the evolution of order-to-cash (O2C) is gaining strong momentum. What was once an antiquated back-office function is increasingly becoming customer-centric. It has to, as younger buyers now expect a seamless experience from the moment they begin purchasing through to payment.

 

PYMNTS also reports that 93% of CFOs view accounts receivable as a strategic priority and plan for more automation. Order-to-cash process efficiency is no longer about the back office; it has become a liquidity challenge, a customer-experience issue, and a forecasting barrier.

 

 

The criticality of tech-led O2C innovation

 It’s clear that modernizing O2C is essential to remain competitive and resilient in volatile markets. Technology drives strategic reinvention, creating competitive advantage through O2C improvement, but how do you move forward? The good news is that there are many opportunities to explore. Artificial intelligence (AI), machine learning, and predictive analytics can significantly increase efficiency.

 

Digital platforms also offer major opportunities; solutions are available that can optimize individual O2C steps or support full end-to-end automation. Importantly, this applies across e-commerce and omnichannel settings; after all, most merchants operate online and in physical locations, and buyers expect a consistent experience across all channels.

 

At a fintech salon held in London, one panellist expressed the aspiration for an overarching solution: “A flexible payment solution that works across online, offline, and integrated systems helps meet buyers where they are. It reduces friction and builds trust. When you make it easy for customers to purchase how and when they want, you’re not simplifying the transaction; you’re reinforcing the relationship.”

 

So, how do we act on this? Here are some ideas.

 

 

AI addresses critical B2B challenges
Across sectors, leaders are increasingly concerned about risks associated with digital commerce. In e-commerce, for example, you may not know your buyers, there’s no salesperson involved, and identity verification becomes more complex. Working-capital strain is another challenge—if buyers pay in 45 days, your cash is tied up. Staffing shortages add further pressure, as many merchants struggle to find skilled people to support business growth.

 

As a result, brands are seeking agility, especially in uncertain markets, and they expect transformation initiatives to reflect that. A positive development is that AI is increasingly providing practical tools and insights. Payment data is critical for identifying anomalies in buyer behavior, and modern payment platforms can process large volumes of incoming data, using AI to predict defaults and proactively mitigate risks.

 

AI can also be used to personalize communications for both small and large buyers, significantly reducing the manual burden on key-account teams and improving communication throughout the entire order-to-cash journey.

 

AI also enhances dispute resolution, a persistent pain point and a core feature of the order-to-cash process. Automated communication can streamline disputes and improve the buyer experience. Fraud detection and compliance offer additional opportunities, particularly in AML and KYC (know your customer) checks. Robotic process automation (RPA) can accelerate payment posting, freeing up credit capacity and enabling buyers to continue purchasing without delay. Other breakthroughs include machine learning models that predict customer dormancy based on account, purchasing, and payment data, enabling sales teams to proactively re-engage buyers.

 

 

Getting started on O2C transformation

Such advances prove that O2C is no longer just an administrative function, but a genuine driver of growth. However, turning that vision into practical reality starts with a clear understanding that any automation or AI-led optimization must be embedded within operations.

 

O2C transformation winners emphasize the need to focus on high-friction areas in the process and break improvements into manageable steps. Whether the bottleneck is customer onboarding, days-to-pay, dispute resolution, or payment allocation, small milestones create momentum and help maintain progress.

 

To measure success, track days sales outstanding (DSO), working capital, percentage of past-due receivables, average order value (AOV), customer retention, purchase frequency, and overall customer satisfaction. Instant credit approvals are especially important for maximizing new-account conversions. On the back end, monitor dispute-resolution time, payment-application accuracy, invoice accuracy, and the time required to set up new accounts.

 

Critical success factors include the use of clear metrics, defined ownership and accountability, strong change-management practices, and visibility into business impact. Tying incentives to transformation goals helps reinforce desired behaviors and sustain results.

 

Best practice also shows that O2C transformation should never be treated as separate from daily work—doing so ensures that transformation efforts support strategic priorities. Centralized dashboards and visual reporting are essential. Visual metrics help teams understand progress, identify issues early, pivot quickly, and stay motivated.

 

Another key element of a modernizing project is the use of transformation management offices (TMOs) or project management offices (PMOs). This highlights the critical human and organizational aspects of transformation, directly tying into change management.

 

By dedicating resources to the transformation journey through a centralized office, organizations can achieve stronger execution discipline and better cross-functional alignment. Initiatives that occur on the sidelines are far less likely to succeed. To truly become business as usual, transformation must be embedded within operational teams and managed across functions. Top-level buy-in is also critical for any serious effort to improve your O2C process.

 

A 2026 O2C to-do list

We can sum this up with the following key takeaways:

1. It’s time to see order-to-cash transformation as a growth engine, not merely a back-office necessity
2. Leverage AI and automation to enhance the entire process
3. Build strong cross-functional alignment so your planned O2C changes truly take hold and remains sustainable
4. Build momentum through small wins and incremental improvements
5. Consider whether to manage transformation internally or to partner with a strategic provider.

Putting some of these priorities on your agenda over the next few months could help make 2026 a decisive and transformative year for your company.

 

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Inez Berkhof-Hollander is EMEA Vice President for TreviPay, the global B2B payments network

 

Main image courtesy of iStockPhoto.com and acilo