Class, let's practice our understanding of the revenue cycle. Please answer the following and substantiate your response. The following is the business activities performed in the revenue cycle:
2. cash collections
3. sales order entry
The revenue cycle is a constant set of business activities and processing operations that provide goods and services to customers and collecting their payments. The four basic activities are (in order): sales order entry, shipping, billing, and cash collection. The sales order entry is done in the sales order department, which includes taking the customer’s order, checking their credit, checking the availability of inventory, and/or responding to the inquiries made by the customers. Shipping is done by the shipping department, who packs and ships the order. Billing is done by the billing department, who creates invoices for the customers and updates account receivables. The final step is cash collections, which is done by the cashier. He/she handles the customer remittances and deposits them in the bank.
Thanks so much for demonstrating your good understanding of the Revenue Cycle. Now I have an "opinion" question: many companies have outsourced customer service/call centers. Locations where these services are now provided range from somewhere in the U.S. to foreign countries where wages are lower. What is your opinion on how quality has been, perhaps, compromised by this move? Anyone? Let's also describe how a company can safeguard customers' credit card information?
I will have to agree with my peers on this one. I think outsourcing to a different country causes more harm than good. Considering that the employees have a lower wage, it doesn’t necessarily mean they know what/who they’re working on/for. There’s only so much training that can be done. Many people get frustrated when calling a call center and they get someone on the other line that doesn’t know the product and keeps putting you on hold to find out what the correct answer is. Language barriers are also an issue because sometimes people’s accents are difficult to understand and it can cause an issue when giving out payment information. There could be a decrease in customers for a company if businesses outsource their customer service.
Should companies allow purchasing agents to start their own businesses that produce goods the company frequently purchases? Why or why not? Would you change your answer if the purchasing agent’s company were rated by an independent service, such as Consumer Reports, as providing the best value for price? Why?