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Manage Working Capital to unlock liquidity for your business
Explore how we have helped clients enhance their processes through broad measures and the approach we take to help them manage cash flow.
Working with a multitude of large and small clients across various industries, Deloitte’s Cash & Working Capital team is at the forefront of advising such clients on the importance of effectively and methodically approaching working capital. We may assist your organization to enhance its working capital processes by:
- Reviewing historical and current performance for the order-to-cash (O2C), procure-to-pay (P2P), and forecast-to-fulfill (F2F) cycles; to identify key trends, patterns and areas for improvement.
- Benchmarking your organization’s working capital metrics against a comparable set of peers for all cycles; to identify best practices and best-in-class measures that could be deployed to improve your business.
- Reaching deeper into your business to engage with operational teams and key stakeholder to better align liquidity needs.
- Forecasting working capital levels and the impacts of seasonal needs and market changes.
Efficient working capital levels ensure you are only investing what is needed to meet short term obligations and not tying up valuable resources that can help improve your business.
Success stories
Future of Work: Ways of working in uncertain times
Global Fortune 100 logistics company
A Fortune 100 transportation services company with declining days sales outstanding (DSO) and days payable outstanding (DPO) metrics over the last few years recognized an opportunity to improve its O2C and P2P processes to drive cash benefits in order to reduce debt, lower interest costs, and fund growth. An initial assessment identified more than $1 billion in working capital opportunities, and Deloitte’s Cash & Working Capital team worked closely with the client on numerous pilot programs to help it implement leading practices across the O2C and P2P cycles.
A $60 million US software as a service (SaaS) company
A $60 million US SaaS company, owned by a private equity firm, was in the process of combining five different acquired businesses into one organization. Deloitte performed the working capital assessment and subsequent implementation phases across the O2C and P2P cycles and leveraged tactical and customized tools, templates, checklists, and reporting metrics to assist the company’s team in executing process improvement initiatives. We helped establish weekly “Cash Council” calls to discuss key performance indicators (KPIs), progress, and follow-up action plans. $5.4 million in total working capital improvement opportunities were identified, $3.9 million for O2C and $1.5 million for P2P. A total of $2.8 million was realized from the opportunities identified over three months.
Multinational specialty manufacturer
A $2 billion multinational specialty manufacturer of electronic devices was facing working capital challenges due to the decentralized nature of its organization. Reporting processes and data were not centralized, limiting management’s visibility for effective sales and operational planning and its ability to make structural improvements for material requirement planning and inventory management. We improved the sales forecast to production planning by unit to improve forecast accuracy and identified and cleaned up slow and obsolete inventory. A total of $42 million was realized over four months.
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Key issues by working capital cycle
Approach
By freeing trapped cash on the balance sheet through working capital improvements, companies can fuel growth, pay down debt, or return capital to shareholders.
—Anthony Jackson, Principal, Deloitte Transactions and Business Analytics LLP
Explore our insights on how to improve working capital and liquidity
Our team
Anthony J. Jackson
Deloitte Transactions and Business Analytics LLP
Mike Quails
Managing Director, Deloitte Transactions and Business Analytics LLP
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