Working Capital Optimization Using Process Analytics
Industrial companies are under constant pressure to improve their liquidity and release tied-up capital. With our new three-part series on working capital optimization, we demonstrate in a practical way how we use process analytics in our projects to expand financial flexibility and streamline processes.
In each part of this series, we focus on one of the three key components of working capital and highlight how targeted measures can contribute to optimization. Using practical examples from real projects, we show which key levers can be used to increase efficiency — whether in the areas of accounts receivable, accounts payable, or inventories.
Our project approach follows a clearly structured and field-tested process, from data-driven analysis to tailored measures that are supported by the organization (including buy-in from those responsible). Through our process mining approach, we are able to identify and evaluate interdependencies across different functions.
How does data-driven accounts receivable optimization work?
In the first part of this series, the focus is on accounts receivable. These play a crucial role in working capital, as they directly impact a company’s liquidity. Long payment terms or outstanding receivables tie up capital that could otherwise be used for investments or other operational purposes. By accelerating invoicing, optimizing payment terms, and improving receivables management, companies can significantly reduce capital lock-up periods, increase liquidity, and gain financial flexibility. This not only improves financial stability but also lays the foundation for sustainable growth. Efficient processes in accounts receivable are therefore a key lever for optimizing overall working capital.
Following the analysis, the identified levers are prioritized and specified in close collaboration with the responsible stakeholders within the company. The goal is not only to define measures theoretically, but to tailor them عمليmatically to the company’s specific requirements. By aligning with those responsible for implementation, it is ensured that the measures are widely accepted and have a lasting impact—for a measurable improvement in liquidity and process efficiency.
As an overall result of our projects, this leads to a coordinated program with transparent and validated potentials that are supported by the organization.
The accounts payable side of working capital can also be sustainably improved in a data-driven way.
In the second part of this series, accounts payable (AP) are the focus as another key lever for optimizing working capital. While accounts receivable focus on timely invoicing and prompt customer payments, the optimization of AP aims at the strategic use of payment terms.
Using process mining, full transparency is created across the entire process chain. This makes it possible to identify process bottlenecks and deviations in the accounts payable process at an early stage and address them in a targeted manner. In addition, the approach enables a comprehensive data-driven supplier analysis for negotiating new payment terms. For smaller suppliers, AI-supported negotiation of payment terms offers significant potential. Another key lever for optimizing working capital is the avoidance of early payments as well as the automation of invoice verification.
As part of our projects, we regularly achieve an increase in Days Payable Outstanding (DPO) of up to 40%, thereby unlocking significant liquidity potential. Our data-driven approach not only generates short-term cash flow benefits but also supports sustainable improvements in process efficiency.
