By Mark Carson
(Mark Carson is Director of Product Management for the Oracle Order Management Cloud solution. He has been the lead product strategist for Oracle’s Order Management solution for over 12 years.)
When it comes to receiving orders, today’s B2B companies look a lot like their B2C counterparts: Customers place orders via multiple channels and expect a singular, consistent, and streamlined experience.
On the other hand, managing B2B fulfillment can be more complex than B2C. Support for additional channels such as Electronic Data Interchange (EDI) and direct sales are typically needed. In addition, more involved fulfillment processes such as make-to-order and configure-to-order may need to be coordinated and optimized across multiple layers of in-house supply sources, outside suppliers, and outsourced manufacturers.
And there is more complexity. Many B2B companies have existing ERP systems that were not designed to support today’s multi-channel demands and dynamic business needs. There are varied and disconnected processes for order management, resulting in manual order entry in multiple systems and inconsistent responses to customer inquiries on status and availability. This makes it difficult to provide a singular buying experience.
The Role for ERP in Multi-Channel
The order-to-cash process in traditional ERP is tightly coupled across application modules, such as order management, order promising, inventory shipping, and finance—all from the same vendor. For simplistic business models with limited ordering channels and a single ERP instance, ERP alone may be enough. In cases with multiple ordering channels, there are likely multiple ERP instances where applications may come from the same or disparate vendors. This poses a challenge because the tightly coupled nature of ERP makes it difficult and costly to integrate and coordinate the multiple ERPs with the ordering channels to create an effective multi-channel solution.
At the same time, the implementation, maintenance, and upgrading of existing ERP is a big, ongoing investment. Distributed Order Management (DOM) can be an effective and easier alternative. A modern DOM solution can leverage existing ERPs as fulfillment sources, which avoids the costly and often unrealistic alternative of replacing some or all of the ERPs.
Modern DOM Capabilities and Benefits
To support a singular, consistent, and streamlined buying experience across existing ERPs and ordering channels, the DOM solution should support three main functional areas—an order hub, centralized order promising, and cloud deployment—all on a common platform. Let’s take a closer look at each of these three.
- Order Hub: An order hub provides automation of order flows; a centralized and actionable view of global orders; and centralized monitoring of order status and exception management across multiple capture and fulfillment systems. This enables a single-face ordering experience for customers and improves employee productivity.
The order hub functions should include:
- A reusable, user-defined fulfillment-orchestration process decoupled from capture and fulfillment systems to reduce the cost of changes to those systems
- Integration with capture and fulfillment systems, including existing ERPs, to reduce costs. Integrations should be supported on multiple levels—web services for order import and communication with fulfillment systems; rules-driven routing; and pre-integration with existing ordering and ERP systems.
- A centralized view of all orders, including status and exceptions, and the capability to take action to fix exception orders
- Support for orders touching multiple product types, including standard products, configured products, and service products (e.g., warranties and subscriptions) on a single order. It should be possible to orchestrate an order that includes all these product types, whether the order lines are fulfilled separately or have dependencies. It should also be possible to normalize the configured product instance between the ordering and fulfillment systems.
- Centralized Order Promising: Provides a central point to calculate consistent, accurate delivery dates across the entire network of available sources of supply. This capability helps to improve margins and drive down fulfillment costs, while consistently meeting promise dates helps to achieve greater customer loyalty, satisfaction, and retention.
Central order promising functions include:
- Collection of available supply from multiple sources, including warehouses and ERP
- User-definable rules to determine the best source of supply
- Taking customer request date, supply sources, and costs as inputs for outputting promise dates
- What-if analysis to help resolve supply exceptions
- Cloud Deployment: Cloud deployment can reduce costs for implementation and maintenance, improving time-to-market and providing flexible strategies for migration to the cloud.
The DOM solution should be deployable standalone, integrated, or in combination. Standalone allows just DOM to be deployed, and then integrated to existing cloud or on-premises ordering, ERP, or other fulfillment systems. Integrated mode refers to a vendor that has pre-integrated DOM with other functional areas to provide a partial or a complete order-to-cash process in the cloud.
Flexibility in Deployment Is Valuable
The value of having deployment options is best illustrated with an example: A user wants to move their order-to-cash process to the cloud in phases with a complete cloud order-to-cash process for a new division, adding a new eCommerce system while retaining existing ordering channels (e.g., direct sales), moving other divisions on existing ERPs to the cloud over time, and keeping some divisions on existing ERPs indefinitely. To realize the benefits above for this scenario, a vendor-provided DOM solution should include the following capabilities:
- Pre-integrated cloud order-to-cash solution. This would include integration with the vendor’s other cloud modules (e.g., shipping, inventory, manufacturing, procurement, and trade and transportation management)
- Pre-integration with the vendor’s ecommerce system
- DOM capable of integrating with existing order entry systems (e.g., direct sales) that are not from the DOM vendor
- Pre-integration of DOM with other ERP systems provided by the vendor
- DOM capable of integrating with existing ERP systems not supplied by the vendor. The changes made to the DOM policies should be minimal as these existing systems are migrated to the cloud.
To get more information on how Oracle’s Order Management Cloud and Global Order Promising Cloud provide a modern, cloud-based DOM solution to help you realize a seamless ordering experience for your customers, please visit the Oracle Order Management Cloud website.
To learn more about the integration of cloud solutions across your supply chain, please visit www.oracle.com/scm.