Order management

The order management system represents the principal means by which buyers and sellers communicate information of individual orders of product.

Effective order management is a key to operational efficiency and customer satisfaction. Order management can be measured in various ways. Traditionally, however, buyers will assess the effectiveness of order management using order cycle time and dependability as the metric, while sellers will use their order-to-cash cycle as their metric.

 

The five outputs from order management that include customer service, customer satisfaction and profitability are:
*Product availability
*Order cycle time
*Logistics operation responsiveness
*Logistics system information
*Postsale logistics support

In supply chain, the order management process involves all the activities from initiation of customer orders through order processing, order confirmation, order picking and shipping, delivery, billing, collection, and reconciliation of any invoice deductions.
Order management

Make-to-order production

Many companies today produce goods according to specific customer orders instead of according to an abstract production program.

The process in which a product is individually manufactured for a particular customer is known as make-to-order production.

In this process, a material is created only once through the same or a similar production process might be repeated at a later time.

Once a customer order is launched into the production system, detailed requirements are computed and production is planned. The key implication of this method is that it results in along planning and execution window for order delivery.

For make-to-order products, stock keeping is seldom carried out. The demand program only determines the production area in companies by using make-to-order production in which various variant types are produced.

The majority of small and medium sized manufacturing companies work in make-to-order style.

These companies, unlike make-to-order manufacturers who produce standard goods to be stocked and sold from the warehouse, produce their goods when customers order them.

In make-or-order system, there is a direct interaction with customers during all the stages of but it is extensive during engineering phase. Manufacturer quotes delivery schedule and price and there is a discussion among the customer and producer regarding alternatives to reduce cost, reduce time to deliver.
Make-to-order production