Process Approach to Improving Order Management and
Fulfillment Efficiency
Let’s see how many of these challenges sound familiar.
Our orders take too long to process
Our orders are input inaccurately
Our orders and inventory records don’t connect in real
time
Our orders are filled inaccurately
Our orders take too many warehouse workers to fulfill
Our orders take too much time to input
Our orders come from our customers in too many different
formats
Our orders must be formatted in a way that makes it
difficult to put new products into our system
And so on …
And these are just the challenges many businesses face
that directly flow from their order processes.
Accounting reconciliation, item (new product) creation, marketplace
(Channel) management issues, warehouse expense and shipping problems are also
too familiar to many businesses.
Often, we try to solve meet these challenges one at a
time.
Let’s speed up our order process.
Let’s improve the accuracy with which we input orders
Let’s connect our inventory records directly to our order
processes
And so on …
Typically, the results are disappointing, frustrating and
ineffective.
It’s a mistake to try to fix your business using the same
approach you would use to fix your car.
Your car has been expertly designed so that all of the systems work
efficiently and effectively together.
When your water pump goes on the fritz, your transmission is still
working perfectly – and it’s working in perfect conjunction with your engine. Therefore, you can simply fix the water pump
and be confident that the car will run smoothly.
Your business may not be so predictable.
Instead of having a team of experienced automotive
designers incrementally refine proven historical designs and technologies to create
a new model, your business has probably evolved over the years to “get the job
done,” even though the systems are not perfectly integrated or aligned and
optimal efficiencies are never achieved.
We are so busy staying in business that we sometimes fail to take the
steps necessary to allow us to be as efficient (and therefore profitable) as
possible. When we encounter a problem,
we fix the problem. The business
continues along, but doesn’t make as much money as it could if we were able to
step back and look at the interconnection between our various systems and
procedures and conceive better, more efficient and effective processes.
So, we address the problems as though they were
independent of other business activities to which they are connected.
If our orders take too long to process, we add more order
entry staff.
If our orders are input inaccurately, we offer a bonus to
the employee with the highest data input accuracy.
If our orders and inventory records don’t connect in real
time, we update an inventory spreadsheet every morning so the order entry staff
can check inventory availability.
If our orders are filled inaccurately we add a quality
control checkpoint between picking and shipping.
If our orders take too many warehouse workers to fulfill
we set higher picking targets to encourage faster picking.
If our orders take too much time to input we create
dropdown menus for easier data input.
If our orders come from our customers in too many
different formats we create financial incentives for our customers to use our
preferred order receipt format.
If our orders must be formatted in a way that makes it
difficult to put new products into our system we try to modify the item
descriptions to make it easier to add new items.
With predictably unsatisfactory results.
Our additional order entry staff still struggle to be
efficient and instead of improving our order entry system, we achieve daily
increased order entry at the cost of reduced individual efficiency.
Our data entry accuracy is improved, but with increased
employee cost and we find that the best employees compete for the accuracy
bonus, but the worst employees don’t improve performance.
Our inventory confirmations didn’t seem to get much
better, because the spreadsheet we use to make sure we have items in stock
becomes out of date within a few hours every morning.
Our order fulfillment got more accurate, but now we have
a bottleneck at the pre-shipping quality control station.
Our higher picking targets caused frustration and
resentment.
The dropdown menus helped sometimes, but limited our
order input flexibility.
Some of our customers opted to use a different format to
send us orders, but others wouldn’t switch and our order entry staff is still
struggling to respond to a wide variety of order transmission protocols.
We can input new products into our system faster, but we
have lost flexibility in the ability to describe the products in ways uniquely
appropriate to particular products, resulting in a less persuasive presentation
to our customers.
Why didn’t our solutions solve our problems?
Because you can’t fix a leaky boat by bailing out the
water. The root causes of the problems
must be addressed.
A comprehensive, system-oriented solution is required. There is a complex matrix of connections
between every aspect of order receipt, entry and fulfillment activities. Only by embracing a solution that addresses
the complexity of these interactions can you hope to permanently improve the
deficiencies in your systems and put yourself on the road to sustainable
increased sales and profit.
Avectous has over twenty years of sophisticated
experience in analyzing complex business systems and architecting simple,
elegant and comprehensive solutions. Our
solutions are adapted to the effective and efficient parts of your business
model and improve the less effective aspects, resulting in an easy-to-use “soup
to nuts” system that gives you optimal efficiency and control. You will be able to reduce employee
population and inventory levels while selling more and filling more orders
faster and more accurately leading to a dramatically improved user experience
for your customers.
Avectous.
Take Control!
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