Answer to Question 1
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Answer to Question 2
For business organizations, selling products or services are the main way of generating revenue. Many online retailers provide real-time stock information; however, in case an item is out of stock after placing an order, the customer will be notified. If the item is in stock, the customer's order will be put together and shipped, and his credit card will be charged. Together, the processes associated with selling a product or service are referred to as the order-to-cash process. This process can be broken down into multiple subprocesses. For most businesses, the order-to-cash process entails subprocesses such as creating a customer record; checking the customer's creditworthiness; creating an order; checking and allocating stock; picking, packing, and shipping; invoicing; and collecting the payment. Depending on the nature of the transaction, the individual subprocesses and the time in which these are completed can differ considerably. An ineffective order-to-cash process can have various negative effects for organizations; for example, the manual input of order information often causes errors, as do suboptimal picking and shipping processes. Together, such errors can lead to a high rate of disputes that have to be resolved, ineffective collection processes, and, ultimately, defecting customers. In contrast, an effective order-to-cash process can create customer satisfaction, speed up the collection process, and serve to provide valuable inputs into business intelligence and customer relationship management applications.
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