1. The “Order-to-Cash” Process: Part I, Marketing and Sales (M/S)
Chapter 10
The “Order-to-Cash” Process: Part I, Marketing and Sales (M/S)
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2. Learning Objectives
To describe the business environment for the M/S process
To analyze the effect of enterprise systems and other technologies commonly used in traditional implementations for the M/S process
To analyze how the integration provided by enterprise systems and e-business add-ons can improve effectiveness and efficiency of the M/S process
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3. Learning Objectives (cont’d)
To describe the logical and physical characteristics of the M/S process and its support of management decision-making
To describe and analyze controls typically associated with the M/S process
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4. The Order-to-Sales Process
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FIGURE 10.1

5. A Horizontal Perspective of the M/S System
NOTES:
1. The pyramids represent the organizational structures within which the sales order, credit, and shipping departments reside.
2. The horizontal lines numbered 1–9 represent information flows generated by the M/S. As mentioned earlier, these information flows support the repetitive work routines of the four departments depicted. A short explanation of each flow is provided in Table 10.1.
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FIGURE 10.2

6. M/S Horizontal Information Flows
Customer places an order.
Sales order department requires credit approval from credit department.
Credit department informs sales order department of decision.
Sales order department acknowledges the customer order.
Sales order department notifies shipping department of the sales order.
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7. M/S Horizontal Information Flows (cont’d)
Sales order department notifies warehouse, revenue collection process, payroll process, and general ledger.
Warehouse sends completed picking ticket to shipping department.
Shipping department informs sales order department of shipment.
Shipping department informs carrier and revenue collection process of shipment.
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8. A Vertical Perspective of the M/S Process
NOTES:
1. This figure represents a partial organization chart of the marketing function.
2. The broken lines represent vertical information flows (often in the form of management reports) based on data generated or captured by the M/S process.
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FIGURE 10.3

9. The M/S Process—Context Diagram
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FIGURE 10.4

10. The M/S Process—Level 0 Diagram
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FIGURE 10.5

11. Dissemination Documents
Picking ticket
Authorizes warehouse to “pick” goods, send to shipping. Has warehouse location.
Packing slip
Attached to outside of carton; identifies customer and goods.
Customer acknowledgement
Notifies customer of acceptance of order; shipping date for order.
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12. Dissemination Documents (cont’d)
Sales order notification
Internal form sent to billing department re pending shipment
Bill of lading
Contract between shipper and carrier
Carrier gets copy, shipper keeps copy.
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13. Logical Data Descriptions
Marketing data
Customer master data
Inventory master data
Accounts receivable master data
Sales order master data
Completed picking ticket file
Shipping notice file
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14. Sample SAP Sales Order Entry Screen
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FIGURE 10.6

15. M/S Process Flowchart FIGURE 10.7a
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FIGURE 10.7a

16. M/S Process Flowchart (cont’d)
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FIGURE 10.7b

17. M/S Process Flowchart (cont’d)
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FIGURE 10.7c

18. Modified M/S Process TI 10.3
BCL = Sales order bar code label (one per carton) BCT = Bar code ticket (one for each product item) SO = Sales order
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TI 10.3

19. Sample SAP Sales Analyses Report
FIGURE 10.8
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20. Control Matrix for the M/S Process
Explanation of cell entries – see Exhibit 10.1.
KEY:
Possible operation process goals are (not intended to be all-inclusive): A—Provide timely responses to customer inquiries. B—Provide timely acknowledgment of customer orders.
C—Provide assurance of customer’s creditworthiness. D—Provide timely shipment of goods to customers. E—Comply with the fair pricing requirements of the Robinson-Patman Act.
IV = input validity
IC = input completeness IA = input accuracy UC = update completeness UA = update accuracy
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FIGURE 10.9a

21. Control Matrix for the M/S Process
Explanation of cell entries – see Exhibit 10.1.
KEY:
Possible operation process goals are (not intended to be all-inclusive): A—Provide timely responses to customer inquiries. B—Provide timely acknowledgment of customer orders.
C—Provide assurance of customer’s creditworthiness. D—Provide timely shipment of goods to customers. E—Comply with the fair pricing requirements of the Robinson-Patman Act.
IV = input validity
IC = input completeness IA = input accuracy UC = update completeness UA = update accuracy
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FIGURE 10.9b

22. The M/S Process—Diagram 1
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FIGURE 10.10

23. The M/S Process—Diagram 2
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FIGURE 10.11

24. The M/S Process—Diagram 3
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FIGURE 10.12

25. Entry-Relationship (E-R) Diagram for the M/S Process
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FIGURE 10.13

26. Selected Relational Tables (Partial) for the M/S Process
FIGURE 10.14
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