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What is Order Management? A Step-by-Step Guide to Improving Supply Chain Efficiency!

Akansha Gupta

| Updated: Oct 09, 2021 | Category: CFO Service

What is order management?

When a customer places a purchase on an online shopping platform, the company’s procedure of picking, packaging, and shipping begins. An order management in supply chain system should be implemented to guarantee that products are delivered accurately and on time to customers.

The company would need to build systems which will enhance supply chain management efficiency and streamline customer support, particularly when sales begin to accumulate and new channels are formed.

What is Order Management in Supply Chain?

The procedure of receiving, fulfilling, tracking, and shipping a customer’s purchase is known as order management. This procedure commences when an online consumer places an order and concludes when the product is delivered.

It also includes interacting with consumers in the event of a disruption in the order fulfilment process, like out-of-stock goods or product shortages. Furthermore, an efficient order management in supply chain system helps guarantee that the correct items are dispatched and delivered to customers on schedule.

Significance of Order Management Accuracy

Companies require accurate and consistent order management procedures to ensure that they keep up with demand and fulfil every consumer’s request accurately.

Some solutions include a two-way sync that ensures that information is transferred between your order management system and your ecommerce platform while also allowing you to see the complete process. This can aid in the automation of the flow of sales order information to each component of the retail supply chain.

That implies that you can follow a consumer’s order from the “Buy” button to delivery — and even returns.

In a nutshell, an order management system organises and automates everything that must occur in order for customers to get their orders on time and in good condition.

Companies that prioritise accuracy while supervising orders will be able to achieve a number of things:-

Significance of Order Management Accuracy

Steps for a successful Order Management in Supply Chain Process

Steps for a successful Order Management Cycle Process
  • Step 1. Placed order
  • Step 2. Receive Customer Orders
  • Step 3. Picking   
  • Step 4. Packing
  • Step 5. Shipping
  • Step 6. Post-Sales Procedures
  • Step 7. Determine what could have been better.

Conclusion

The process of accepting, tracking, and delivering client orders is known as order management. An excellent order management system is required since it assists the business in maintaining appropriate stock levels at all times, eliminating errors with order fulfilment, ensuring data reliability, and improving operational efficiency. Executives must track particular key performance indicators[1] to proactively evaluate how productive a company’s order management process is. The most commonly monitored metrics are the rate of return, picking accuracy, order lead time, and order frequency. Companies that wish to enhance their system must focus on client demands, assure timely delivery, and encourage complete process transparency.

Read our article:What is Supply Chain Management and Its Importance?

Akansha Gupta

Akansha is a Delhi-based lawyer who is actively involved in publishing articles on a plethora of aspects of Indian and International laws. She holds Master in law (LL.M) focused on Business Laws from Amity University, Noida. Having expertise in the same, she has authored several publications on legal topics related to corporate, M&A and commercial laws.

Business Plan Consultant


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