The 3-Step Digital Transformation Strategy That Can Increase Your Order-to-Cash by >30%

I ran across a technique that would have accelerated our customer onboarding speed and our cash cycle at RSi while we grew from $8M to $60M.

I binged on Prof Wil van der Aalst's work in Process Mining to study how. Also, I wanted to see if I could find a repeatable framework to achieve a 30+% increase in onboarding velocity.

40+ hours later, here’s what I learned:

Quick Stats About Process Mining

Here are a few points to give you the context in case you are unfamiliar with Process Mining:

• Measure Actual Process steps.
• Identify Constraints and dwell points.
• Measure the impact of changes.

So... what can we learn?

3-Step Framework For Increasing Velocity

From my research, people used a simple process:

1. Collect data
2. Modeling
3. Identify the constraint and root cause

Let's dig in:

Step 1: Collect Data

Process Mining begins with Data Collection.

To do this, identify sources for 3 must-have elements:

• Id - could be PO #, Case Id, or similar
• Activity Name
• Start Time

Other optional data are helpful, like End Time and Resource Name. Most ERP systems will have these data and other systems like WMS and MES. For monitoring external manufacturing processes, use the "data exhaust" from your EDI messages.

Step 2: Modeling

Most Process Mining tools (links in the comments) will create the process model. The tool will also highlight the constraints. See the screenshot; in this simplified PO process - 50% of the transactions need rework, and the step before is a bottleneck in the end-to-end process.

Step 3: Elevate the Constraint

With the identified constraints

• Select the most impactful constraint ($, time)
• reducing rework would save time AND reduce the bottleneck in the previous step
• Review details with the team to discover if it is a simple fix or add to your development roadmap.
• Execute the fix, repeat the process

At RSi, I did all the work manually - knowing about process mining would have improved our cycle times by >30%, and it is certainly something I am adding to my toolbox.

Using the three steps on an ongoing basis should help drive massive value from your digital transformation efforts.?