There is arguably nothing more damaging to a relationship between a customer and a business than poor order management.
Getting the order right is our most basic expectation as consumers. While it’s possible the purchase won’t live up to our personal standards, almost none of us will accept having to call customer service to report a late delivery. Fortunately, a quality order management system (OMS) can reduce the threat of customer dissatisfaction stemming from a mismanaged order.
And, honestly, the benefits of an integrated OMS don’t end there. But first, let’s discuss what an order management system is and how your business can best utilize it.
Mastering Order Management
At the highest level, an OMS keeps everyone involved in supply chain management within your organization in the loop. It does this by tracking sales, orders, inventory and fulfillment.
In the past, these functions were all done over the phone or through fax. An employee at a story would need to contact an employee at the company warehouse and state their order. The warehouse employee would then need to fulfill the order and later contact suppliers when inventory levels got low.
When you consider all of the moving pieces involved in the ordering and fulfillment process, the room for error quickly becomes clear. Even minor miscommunication can result in overstocking or understocking.
Rather than taking that risk, many companies now use digital OMS that integrate with other software systems they use—accounting software included.
Here are a few other benefits OMS systems offer aside from the convenience we’ve mentioned.
1. Improved Profitability
Earlier, we noted just how harmful a lost or incorrect order can be to the relationship between a business and its patrons.
It gets worse. Unless your company is Amazon, there is a very small chance a customer will visit your site again if they go to make a purchase and learn an item is out of stock. It often takes customers a while to recognize a need for a product or service. And it takes even longer for them to decide on a supplier for that product or service. They likely won’t take the time to do so again if you’re not carrying what they are looking for.
If that’s not damaging enough to your company’s bottom line, consider the number of employees involved in your company’s supply chain management function. There is a fairly good chance some of those employees are spending a great deal of time performing rote tasks if your company has yet to adopt a modern OMS.
With all of this in mind, the potential for widened revenue streams and cost savings are fairly evident. An order management system can reduce, if not eliminate, stockouts. This will help your company increase customer lifetime value. It will also create new efficiencies since fewer employees will be needed in your company’s supply chain management department.
2. Increased Visibility into the Order Management Process
All of the moving pieces involved in the order management processes of the past made it very difficult for managers to pinpoint potential areas of growth. That’s now changing.
Now, managers have the ability to see how well each key player in the process performs their role as well as how each of pieces connect. For example, imagine a situation where the time it took to ship goods from a warehouse to a fulfillment center varied greatly from day to day. In the past, managers would be forced to essentially operate under a hunch. Conversations with a trucking contractor had the potential to go nowhere absent any concrete data.
With modern order management systems, managers can go into these meetings with indisputable data points. This data allows for more productive conversations that lead to improved outcomes for everyone involved.
3. Prepare Your Business for the Future
Managers and employees want to see their business grow. It’s a sign of a successful business model, and everyone wants to be on the winning team.
But growth brings with it numerous challenges. A business can quickly outgrow the processes it used when it first launched. Order management processes are no exception. Employees, especially, can quickly become overwhelmed if what was once a steam of orders quickly becomes a raging river.
A good order management system can help your whole staff keep up with any increases in order volume. Realistically, their daily schedules shouldn’t look all that different if they are already well versed in using the software. This will help your business hold on to your loyal customers and avoid the growing pains so many other firms experience as they expand.
If improving your order management system through automation is one of your priorities for 2021, we’re here to help. Sage Intacct can integrate with your firm’s Salesforce account to help your sales and finance teams share pricing, order status and other information while allowing you to seamlessly generate order entries.
Contact Timac Business Systems today for a free product demo!