Purpose of a Revenue Cycle Management Team


In the global marketplace, making money may no longer be the sole purpose of the competitive battle. A business must implement specific policies to generate revenue but also find ways to hold onto cash or gain market share. Establishing a revenue cycle management team is one step toward assuring cash generation and competitive expansion.

Revenue Cycle

A company’s revenue cycle runs through all processes and mechanisms the organization sets to make money, attract customers, make sure clients send remittances on time and prevent the adverse specter of credit risk and bad debt. The cycle enables top leadership to consider the narrow problem of profitability management from various perspectives. For example, senior executives may review profitability trends from a revenue-growth standpoint or through the lens of expense management, market share gain and customer attrition prevention.


Corporate personnel who work in the revenue cycle hail from various departments, although specific business units represent the bulk of the contingent. Segments such as accounts receivable and sales help a company find effective ways to spur sales without sacrificing product quality. Personnel from marketing, revenue management and accounting also weigh in on revenue cycle management discussions, plotting tactics to identify and exploit competitors’ strategic weaknesses.


The primary purpose of a company’s revenue cycle management team is helping the business make money, hold onto it as long as strategically convenient and avoid high levels of outright write-offs and bad debt. This is the operating loss arising from a customer’s inability to remit funds after receiving goods. Employees working in the revenue cycle management also determine how an organization can effectively improve the bottom line, advising product managers on pricing strategies and telling them whether to raise item tags or keep them constant.

Strategic Relevance

By implementing a revenue administration group, a company takes the necessary steps to foster profitability and expand the way employees think of revenue administration. The goal is not to limit the conceptual space that personnel explore with respect to sales growth but to give them free rein to come up with various answers or outcomes about the need to expand sales.


To adeptly perform tasks, revenue management personnel rely on a hodgepodge of tools, equipment and worksheets. These range from mainframe computers and financial analysis software to customer relationship management programs and categorization or classification software. Other tools include credit adjudication and lending management system software, also known as CALMS; accounts receivable and payable management applications; and enterprise resource planning software.

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