An order management system (OMS) is necessary for ensuring that the right inventory is promised to, and deliver efficiently, according the unique needs of each sales channel. An effective OMS will manage enterprise level inventory and its allocation across sales channels, optimize the efficient sourcing and scheduling of orders, manage backorders and returns, and enhance the overall customer experience. It becomes essential when a business outgrows manual processes, which are slow, error-prone, and cannot handle increasing order volumes.
The value proposition around order management is heavily dependent on your specific business and sales channels. SCT helps to define the needs and priorities based on impact to your business.
- Business to Business Order Management emphasizes a focus on inventory reservations to strategic accounts and channels, with capacity based manufacturing scheduling based considerations for longer lead time and build to order requirements.
- Direct to Consumer Order Management emphasizes minimizing shipments to fulfill orders with a lowest cost scenario that meets the delivery requirement of the customer. This could result in alternate facility sourcing, drop shipping, order splitting, consolidations, zone skipping,
Benefits include:
- Improved customer experience: Accurate delivery promises, real-time order tracking, faster fulfillment.
- Cost efficiency: Optimized sourcing reduces shipping cost and labor.
- Inventory accuracy: Prevents stockouts, overstocks, and lost sales.
- Returns efficiency: Faster processing, reduced reverse logistics costs.
SCT typically estimates ROI from order management system initiatives as follows:
- Labor & process savings: 20–40% reduction in order-processing effort.
- Inventory savings: 10–20% reduction in carrying cost.
- Shipping/fulfillment savings: 5–15% reduction in cost per order.
- Payback period: Often 6–18 months, depending on scale and complexity.
