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White Paper

The Changing Face of Global Order Management

 

With the concept of ‘design anywhere, build anywhere, sell anywhere’ gaining prominence, and competition driving the manufacturing organizations to transform their business models from pure B2B to B2B2C; a new level of process and system capability is needed in the order management process, which allows for global transactions, customer pull alignment, and bringing in the element of ‘experience’. This white paper discusses how manufacturers are leveraging next generation technologies to redesign the order management processes.

Snapshots from the industry

Based on recent work done in the order management area, further embellished with secondary research, we discern the following key trends:

  • Lead Time Optimization is a high priority item for the industry. Leading players in the automotive and the industrial manufacturing sectors are working on initiatives to re-engineer the order management process and shrink the order cycle time, eliminate order processing bottlenecks, improve process transparency, and create global Available-To-Promise (ATP) capabilities.
  • Building a customized view into order management is a growing trend. Global original equipment manufacturers (OEMs) are working to establish a transparent order management system that gives its customers the ability to view their orders from the point of order slotting and release-to-line, up to the final dispatch — giving them a ‘customized’ experience. Some manufacturers are empowering their customers and the field force with the ability to configure their products and facilitate real time order generation, visualization and acceptance.
  • Extended context and multichannel integration is another major change in the order management business, wherein orders for service contracts, accompanying goods and merchandise (in the case of luxury brands), financial and leasing packages etc. are being included in the offering portfolio. As the scope of the channel increases, the integration of multiple channels to ensure a single order view is becoming an imperative. 

Next Generation Order Management Systems

We examined the possibility of applying next generation technologies in the area of order management and identified some emerging trends in next generation solutions for the supply chain.

  • Big Data has been applied in the area of demand management, wherein multiple data sources are analyzed in order to enhance forecast accuracy and to reduce forecasting errors. Order orchestration (capacity optimization) is another area where Big Data and analytics can come in handy.
  • Social media tracking is primarily being used for refining forecasts and estimating business trends.
  • Mobility is being leveraged for a host of customer facing roles; including real time availability and promise management, configurator, order booking, order statuses, etc.
  • Cloud-based solutions are primarily being used to offer dealers access to central global order systems on a pay-per-use basis, bringing down their total cost of ownership (TCO), and at the same time, using a single system for order capture.

Challenges in Execution

There are a significant number of ‘constraint functions’ that need to be considered while building next generation order management systems.

  • The use of disparate legacy systems to manage orders limits the flexibility and agility to respond, and also constrains the planning to batch processes
  • The limited flexibility of the manufacturing systems to be able to respond to the front end agile opportunities provided by the new generation systems
  • The inability of the supply chain to rapidly respond to schedule changes (Just-in-Time and Just-in-Sequence capabilities)
  • Lack of ease-of-use ‘apps’ for all segments of users – customers, planners, order takers, sales people and others
  • Unavailability of limitless internet access like 4G right through the value chain to have real time collaboration

These should, however, not come in the way of embracing next generation order management, instead should be viewed as an opportunity to socialize the concepts and secure a buy-in from the stakeholder community, while the organization gets ready with a more flexible platform. 

To be effective, order management will continue to require significant enterprise system enablement, innovative orchestration algorithms, and tight integration across platforms. Next generation systems including mobility and Big Data add superior customer interface and decision support respectively, but do not replace the conventional system requirements. The opportunity therefore, is to ‘layer’ this relatively ‘mature’ business process of order management with elements of differentiating experiences by leveraging technology.