The typical order management process flowchart illustrates three steps; accepting, fulfilling, and resolving the aftermath of customer orders. With a manual order management process in place, it's tricky to achieve that.
If you prioritize speed and accuracy in order fulfillment, this article will uncover how to improve your order management workflow.
What is an order management workflow?
When a customer places an order online, certain actions take place behind the scenes before their order is fulfilled. Those actions make up the order management workflow.
Workflow in order management refers to activities that make it possible to fulfill customer orders. These include everything from accepting customer orders, creating invoices, managing inventory, and packaging items for shipment.
An efficient order management process workflow is critical for today’s online retailers. 56% of customers expect speedy, error-free deliveries and are not afraid to switch to competitors after having a negative order fulfillment experience.
What is an order management flow chart?
The order management flow chart is a graphic or diagrammatic representation of the processes involved in order management. It contains shapes, lines, and colors, all of which help to provide visual imagery of what the physical processes look like.
How Manual Processes Limit Order Management
Many of the inefficiencies during the order management process are the result of using ineffective technologies. Two popular choices are to simply use an e-commerce platform or make spreadsheets.
E-commerce platforms can handle some parts of the order management process but come with limitations. The order management tools built into most platforms only allow you to capture and track orders from your e-commerce site.
You can get by with this if all your orders come from your e-commerce website and you do not sell through any third-party channels. However, if you sell through more than one channel, or if you have multiple warehouses, you’ll need an additional system to manage inventory and the orders from other channels.
Many businesses use manual processes to manage orders across different sales channels. This generally involves using a spreadsheet to compile orders from each channel. Inventory is updated manually. These changes are then manually applied to each sales channel. If the company has multiple warehouses, a team member must manually choose the warehouses for order routing.
Manual order management is time-consuming, resource-intensive, and unscalable. The time that staff spends updating the system could be better spent on other tasks. Manual processes are also more prone to human error which can lead to further delays in fulfilling orders.
How to Improve the Order Management Process
Standalone order management systems (OMS) provide an end-to-end tool for tracking and managing inventory and orders across multiple channels. With a centralized order management tool, you are free from the bottleneck of having to log into multiple systems to complete essential tasks. For example, logging into Amazon and eBay separately to process orders.
The OMS processes orders from any channel, making details for every order available in a single place. Parts of the workflow are automated, eliminating many manual processes. Some of the tasks an OMS can automate include:
- Processing customer payments
- Routing orders to the appropriate warehouse, especially for dropshippers working with numerous suppliers
- Choosing the best shipping carrier based on the customer’s location
- Printing shipping labels
- Forwarding information to the accounting system
- Updating inventory levels in real-time
- Sending transactional messages like confirmation emails
With an OMS, information moves between different parts of your e-commerce system instantly. This enables orders to be processed and delivered faster. Less manual input also leads to fewer errors throughout the fulfillment process.
The 6 Steps in Order Management Process
On your flow chart, the basic steps for fulfilling customer orders include accepting, fulfilling, and resolving customer orders. To help you understand it better, here’s a detailed walkthrough:
- The customer places an order on a company’s e-commerce site or third-party sales channel.
- The company records and accepts the order after validating payment details through a payment gateway.
- A confirmation email is sent to the customer verifying the purchase.
- The order details are sent to the company’s warehouse or third-party logistics (3PL) provider.
- The products are picked, packed, and shipped to the customer.
- The customer receives a shipping confirmation email and the order.
On the surface, the process seems straightforward. But it gets more complicated when you have orders coming from different sales channels. E-commerce companies without a centralized solution for managing the process can experience operational inefficiencies.
Automating Processes with OMS
An OMS can streamline your order management workflow to let you deliver customer orders with precision and speed. OMS software tracks inventory levels with the help of scannable SKUs.
When employees scan the SKU bars on products, the software automatically removes the item from your inventory. This gives an accurate view of your stock and reduces the time it would take to manually update the quantity on spreadsheets.
OMS also tracks and monitors customer insights on multiple sales channels. That means if you're a merchant on Amazon, eBay, or Shopify, you can have a central platform where all your customer data can be stored and accessed easily.
E-commerce channels also have features for monitoring customer data and processing orders. However, they are limited. For example, if you're a merchant on Amazon, you can view orders and sales you've completed. But you can't track the data on Shopify through Amazon's sales platform.
So to keep track of all that data, you must create a spreadsheet using Excel and enter them separately. This is time-consuming and stressful.
Improving Order Management Workflow with Flow Charts
By building a flow chart, you are able to get an aerial view of what your order management process looks like. This will help you to identify bottlenecks.
When you have a clear view of inefficiencies in your processes, you can find solutions for them. It will also help you determine which order management system is ideal for resolving those issues.
Here are 5 best practices for creating a good flow chart:
1. Choose an intuitive software
When choosing software to design your order management flow chart, ensure that the software is user-friendly. It should have drag-and-drop functionality and multiple formatting options. These will help you create your chart easily and with fast speed. You can use the following software:
2. Be consistent
Mismatching texts and shape sizes can make your flow chart look disorganized and confusing. A more organized flow chart allows you to concentrate and make better decisions.
To achieve consistency in your flow chart design, start with making all shapes the same size. Next, use the same colors for similar processes. For instance, you can use blue to indicate the order processing step, and then use yellow to highlight the packaging and shipping processes; post-delivery steps can be orange.
If there are steps in your order management process that are not automated, you can also indicate them in your chart with different shapes or colors.
3. Space out elements
Spacing out your design elements makes it readable. Avoid squeezing too many elements together on one flow chart.
Though it's better to fit every possible element on one page to get an aerial view, you should consider creating another flow chart and continue your design there. You can link the new and old charts together with hyperlinks.
4. Use decision symbols
On your flow chart, you can indicate your responses to certain situations. For example, a customer places an order, but his credit card details are invalid. You can illustrate alternate scenarios that could happen after this.
Your OMS can cancel the order or prompt the customer to enter in new details. If the customer corrects his details, then the software may confirm the order and collect the data.
5. Use trigger words
Your flow chart should use simple language. This means you should use trigger words over sentences. For example, use "Process invoice" and "package order" in place of "processing of customer order" and "packaging of customer order".
Trigger words are words that initiate an action or process. They are short and straight to the point, unlike full sentences. Using full sentences takes up more space on your chart and makes it confusing.
- The 3 major steps in the order management process flow chart are accepting, fulfilling, and resolving customer orders.
- Merchants can use flow charts to have an overview of their order management processes.
- Merchants can also use OMS to automate and streamline order management processes for customer satisfaction.
- fabric OMS is the ideal OMS for merchants who need a centralized hub for data collation.