OTC is critically important in every enterprise – the place where the commercial rubber hits the revenue highway. It's where sales and marketing efforts not only turn into fulfilled orders but, eventually, money in the bank. What's more, it's often at the heart of delivering superior customer satisfaction.
Yet most large B2B corporations still face significant challenges in this cross-functional process, where inefficiencies or inaccuracies can tie up as much as 7%–12% of total revenue. No synchronization between price and product master data, coupled with incomplete calculations of off-invoice discounts, lead to pricing discrepancies and customer invoice disputes. That common scenario requires far too much manual effort to manage and resolve. The result is major delays to invoice settlement, enormous collection costs, and significant negative impact on cash flow. In fact, many organizations spend as much as 60% of total OTC effort managing exceptions and resolving disputes due to billing discrepancies.
That's why there's been so much excitement about blockchain smart contracting.
What are smart contracts? It's simple: They're coded programs that automate transactional events based on contractual terms. Like traditional contracts, smart contracts depend on both parties consenting to terms. But a distributed ledger environment such as blockchain manages these terms.
Just imagine a world where:
- Product pricing and discounting are calculated automatically and accurately based on all available data
- There is distributed visibility of all transactions, fully recorded and validated in real time, with a complete audit trail and 100% compliance
- Receivables are accurate first time and every time, with no need to invest valuable people hours in reviewing and resolving pricing and invoicing disputes
- There is no longer a need for cash applications or deductions management
- Account payment – requiring no action from your customers – arrives on time and in full