3 Issues that Compromise Order Management

by Emily on April 5, 2017

in Articles

Order management is something that most companies are invested in but very few companies are good at. The reason is that to a certain extent, the better a company is at order management the harder it becomes to preserve quality.

Customer satisfaction is very closely linked to the quality of order management. And the companies that are great at it stand out distinctly from their competition. But then order volumes increase, expectations rise, and each component of logistics becomes more complicated.

The twin challenge for enterprises is to build an effective order management infrastructure and then to sustain it through wildly changing circumstances. That is never easy to do, and the circumstances are different for each company. However, there are specific issues that commonly compromise the order management process:

Lacking the Ability to Make Long-Range Forecasts

One of the surest way to lose customers and damage a brand is to run out of inventory when demand is high. In order to properly calibrate inventory, it’s necessary to forecast peaks and valleys in demand and to develop a refined ability to track customer preferences. That is only possible when the order management process is integrated with the sales and marketing departments. If a spike, whether planned or unplanned, is on the horizon, the distribution department cannot be the last to know. All that does is create unnecessary obstacles and cultivate a negative reputation among customers.

Misunderstanding the Resources of Order Management

Today’s customer is very demanding. An easy way for any company to distinguish itself is by attaching guarantees to the fulfillment process. These splashy promotions resonate with customers and present a clear value proposition. If and when the order management process fails to meet those promises, however, it leads to a powerful customer backlash. The key is to calibrate special offers carefully. But considering how many issues can arise related to manufacturers, suppliers, and distributors, it’s hard to make guarantees. Overcoming this issue requires an overarching perspective on all the various processes and input points that are involved. Tools like an EPR that works with Salesforce integrate all the relevant data onto a single intuitive platform. With a robust data management strategy in place, it becomes relatively easy to fine-tune the order management process for greater consistency.

Grappling with New Demands

Distributors often overestimate the flexibility of their order management systems. They assume that when these systems are called on to ship new products, follow new shipping procedures, or ship to new areas that the changes will be handled in stride. What they soon discover is that even minor variations to an established order management process can lead to out-sized and unexpected turmoil. Considering how fundamentally complex the fulfillment process is, this should not come as a surprise, yet change is one of the most common factors that derails order management. The solution is closely related to the previous two issues. In the midst of change, having a steady stream of data coming from every part of the supply chain and from each department is the only way to track trends positively or negatively. It may never be possible to make changes to a distribution process without causing any friction in the process. But when the process is driven by data, it’s possible to limit the friction is causes for customers.

It may have once been acceptable to get by with hit-or-miss order management, but those days are long gone. Companies can expect to start seeing their order management mistakes take a direct toll on the bottom line. The ones that thrive moving forward will be the ones that focus on the underlying issues rather than the individual missteps.

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Darren Daves April 10, 2017 at 16:11

While the blog post highlights some great points, I would like to emphasize the importance of including an ipaas into your business tools. Integration platform as a service (iPaaS) lets you automate your routine tasks, and transfers data from one app to another automatically. This saves time and eliminates human errors that generally happen while moving data.

It is also equally important to invest in an order management tool that some of the top players in the industry are using. These players have already gone through the stages of evolution that some startups are currently into. The price may be a little on the higher side, but it’s worth it.

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