Why do you need order orchestration?
Order orchestration manages, arranges, and automates all the steps and parts to fulfill customer orders. Supply chain management depends on it, including many different tasks from when an order is made until it is delivered.
The following parts of the order management process are affected by orchestration:
- Order confirmation and receipt
- Handling of inventory
- Getting orders ready and delivering them
- Moving things and distributing them
- How to talk to and help customers
- Changes and returns
Analysis and improvement of data
AI and machine learning make putting together orders easier these days. Companies can make real-time decisions, predict demand, find the best ways, and give better customer service with the help of new technology. The goal is to have a smooth flow of activities that makes things run more smoothly, cuts costs, and makes customers happier.
Like words
- Order management
- Order orchestration and fulfillment
- Order orchestration system (OOS)
- Order process automation
When to use order orchestration vs. order management
People often mix up the terms “order orchestration” and “order management” because they do some of the same things.
Order management is keeping track of an order from start to finish. It includes everything, from placing the first order to delivery, returns, and services after the sale.
A part of order management is order coordination. Its main goal is to organize and automate the steps and decisions needed for completion.
A lot of decisions and actions need to be made and acted upon by humans to be managed. Managers and employees are in charge of different parts of the order lifecycle and use their knowledge to make decisions.
The art of orchestration is ensuring systems and processes work together smoothly. This includes ensuring inventory tools work together, automating the picking and packing process, and working with logistics providers.
Put simply, order management is a complicated job that depends on people. Software and process automation are used to cut down on the work that must be done by hand.
Order orchestration aims to improve supply chain operations.
Order orchestration uses modern technology to connect different parts of the supply chain. This ensures that every step in fulfilling an order works together smoothly.
Better inventory control by automatically tracking, reordering, and updating stock levels.
I use integrations for the website, store point-of-sale (POS), warehouse, and third-party sellers to allow multi-channel fulfillment.
It uses AI to predict demand, which improves supply chain processes and gives valuable information.
It has automated picking and packing, making things run more smoothly and more accessible to see.
When you use an integrated method, all your systems share the same data. In other words, when a customer places an order, the stock is updated instantly across all channels.
With information from the past and real-time customer demand, the order orchestration system can tell sellers what to buy before they run out. This keeps stock from running out and stops overstocking and price cuts that cost a lot of money.
Give your customers a great experience.
From the customer’s point of view, compare current orchestration processes to old-fashioned order management methods. When a customer orders on a website, the sale is sent to the warehouse to be handled. The ordered item is either put on backorder or canceled if there isn’t enough stock.
With an order management system, the customer doesn’t have to worry about whether or not there is stock. The website shows the customer the current state of the inventory in real-time. The customer then places an order and gets a confirmation email.
When an order arrives, the software checks it immediately and sends it to the store or warehouse that can best handle it. Or, for faster delivery, the system splits it up and sends it to different places based on their location and stock levels.
People do expect fast if not instant, shipping because of Amazon. Small online stores that use third-party logistics (3PLs) can compete with the biggest stores, which often have their own shipping networks and offer speedy shipping with an order management system.
The customer gets all the information they need right away; everything is clear; the delivery is quick, and it’s easy to return or swap items.
Spend less.
Admins can change the routing logic in order orchestration software, which helps them get the best shipping rates, speeds, and business efficiency.
Besides that, they use it to
- Use filters to keep certain places based on your task and visibility choices.
- Set up rules for specific groups and types of orders to handle complicated route needs.
- Close down places temporarily based on date ranges and order standards
- Separate orders by item or amount to save money on shipping and make customers happier.
- Custom assignment rules let you name things that need extra care.
These tasks keep businesses from paying too much for inventory, labor, and energy. They also lower the financial risk of having too much or too little stock, getting the wrong order, or not handling things correctly.
Get more accurate
Automating order processing, inventory checks, and logistics planning can save businesses a lot of time and money that would otherwise be spent on managing each customer’s order. This speeds up fulfillment times and lowers the chance of human error, making processes more accurate and reliable.
How the Order Orchestration Process Works
Making an Order
The first step in order orchestration occurs when a customer makes an order. The e-commerce site’s checkout tool instantly sends the order details to the central system.
Once that’s done, it finds and distributes goods. When the central system gets an order, it checks for stock in all fulfillment places (like a warehouse or a store).
It puts each item in the right place based on established business rules. The system divides the order among several places if it can’t all be filled in one place.
Taking care of orders
The staff sees the update on their end and gets to work on it as soon as the inventory is sent to each place. Planning, picking, packing, and sending are the three things that happen in a warehouse.
Picking: To fill orders, crews take items from the stores.
Packing: The system puts together the things that have been picked, prints a packing slip and a shipping label, and gives them to the people who pack them. It also creates a tracking identification number (TID) so the customer can track their order.
Shipping: The staff sorts the packed order and gets ready to send it out to be delivered.
A software module generally goes with each process and connects to the central order orchestration hub. The system will be updated with the new state of the order as soon as someone from the fulfillment team starts working on it. After that, the quantity of goods changes on its own.
Sending an Order
The carrier will scan the package when they pick it up from the building. The system gives the package a TID and changes the shipping status. When the carrier gets to the next place, like a transit point or loading dock, it scans again. This process keeps going until the final arrival.
For any problems, the customer can use their TID on the online store or the carrier’s website to get up-to-date tracking information on their package.
The shipping status is changed every time the card is scanned. The system records a signature to show that it was received once it reaches its target and marks it as “delivered.” It also lets the customer know that the delivery was good.
Changes to the inventory
The central system changes the inventory status levels at the same time that the packaged items leave the building, though most more prominent companies do this once work on the order starts. It takes away sold items based on the fulfillment data for each order and the stock counts at the location level.
If an item isn’t in any of the places asked for, the system lets admins know so they can do something about it (like restocking or backorder). It might do that naturally for things used often, like a primary color vs. a seasonal one.
It also changes the inventory state on the store’s website and mobile app (if they have one) so customers can see what’s in stock and decide if they want to buy.
Taking care of returns
Most central order orchestration systems will issue a return ticket for a customer if they want to send something back. Most stores give return labels already paid for, and the customer only pays for them when they use them.
Once the customer uses the label to send back their item, staff reads the tracking number to see why the item was sent back (if it wasn’t stated). They give you a refund or swap if everything checks out.
When you refund a user, some systems link a credit memo to their information in other systems, like SAP Business One or QuickBooks. Others use their method to make the refund. For trades, central systems change the state of the order to “exchanged.”
In both cases, the customer is told about the change and given any necessary tracking information.
Setting the Order
The central system keeps track of the amount due, payments received, refunds, and transaction fees and updates the financial records. Most businesses handle and record payments automatically by connecting to payment gateways and accounting software.
Essential Parts of an Order Orchestration System
An order orchestration system (OOS) helps retailers, manufacturers, distribution centers, third-party logistics (3PLs), and wholesalers handle and speed up the process of fulfilling orders. It’s essential in today’s supply chain management, especially for e-commerce and omnichannel shopping.
Order capture that works with multiple channels of sales, such as online shops, mobile apps, social media sites like TikTok Shop and Amazon, and retail point-of-sale (POS) orders; and inventory management that can be used in multiple places and with multiple sales channels.
Brilliant order handling that takes into account nearby items, stock levels, shipping costs, and pre-set rules for splits and exceptions
The automation of order handling helps check orders, find fraud, process payments, and send warehouse team alerts.
Workflows for communicating with customers to confirm orders, let them know when they’re shipping, and give them progress updates.
Connection to shipping companies for rate quotes, label creation, tracking, and delivery optimization. Order tracking is done in real-time, so customers can see updates every time their package is scanned into a new location or sent out for delivery.
handling returns, including automatic permission and tracking of returns; reporting and analytics for order fulfillment KPIs and looking at old data;
System flexibility to handle more transactions
There are connections between systems for customer relationship management (CRM), configure, price, quote (CPQ), and business resource planning (ERP). You can also use the APPI to make your connections.
Measures of compliance and security to keep order information safe.
At its core, an OOS automates the steps that need to be taken to meet customer orders. This includes many parts of the supply chain, like managing orders, keeping track of stockpiles, fulfilling orders, and delivering goods. Combining these parts ensures that an OOS runs smoothly and quickly, from taking orders to delivering goods.
