CASE ANALYSIS: REVENUE CYCLE
O’Brien Corporation is a midsized, privately owned industrial instrument manufacturer
supplying precision equipment to manufacturers in the Midwest. The corporation is 10 years
old and uses an integrated ERP system. The administrative offices are located in a downtown
building, and the production, shipping, and receiving departments are housed in a renovated
warehouse a few blocks away.
Customers place orders on the company’s website, by fax, or by telephone. All sales are on
credit, FOB destination. During the past year, sales have increased dramatically, but 15% of
credit sales have had to written off as uncollectible, including several large online orders to
first-time customers who denied ordering or receiving the merchandise.
Customer orders are picked and sent to the warehouse, where they are placed near the loading
dock in alphabetical sequence by customer name. The loading dock is used both for outgoing
shipments to customers and for receipt of incoming deliveries. There are 10 to 20 incoming
deliveries every day, from a variety of sources.
