June 2002 | Commentary | IT Matters

Whole Order Visibility Supports Front Lines of Customer Satisfaction

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In the days of dot.com euphoria, an order was an order, plain and simple. Consumers went to Amazon.com to buy a book, then felt the excitement of clicking on "track your package" to follow each step of the delivery.

But B2B order tracking is different. No company uses Amazon.com to place complex equipment orders or source components for delivery to contract manufacturers. And while tracking a factory-direct order from a single manufacturer may seem like it follows a similar fulfillment model as Amazon.com's, most end consumers don't have hundreds of suppliers, each with their own portal and individual links to carriers.

In industries such as installation logistics, orders can be made up of dozens—even hundreds—of line items from numerous suppliers and contract manufacturers. Tracking these orders requires a different kind of vision.

Meeting Customer Commitments

Due to the complexity of orders in installation logistics, order fulfillment is a very difficult task. Companies need to implement systems that can meet the demands of customers to ensure satisfaction and retention. To be a leader in customer service, companies need to provide detailed and accurate information. The challenge of communicating the status of a complex order is difficult because of the barriers to seeing the whole order.

Adding to this complexity, each participant in the fulfillment of a complex order has a different level of technical complexity, ranging from the large ERP infrastructures of Fortune 500s to the QuickBooks back office of smaller suppliers.

For most installation orders, the sequence of events is not unlike generational records. For example, here is a description of a major telecommunication company's supply chain operations, and the various orders that are generated during the entire process:

  1. An equipment order is placed with an original equipment manufacturer (OEM).
  2. The OEM generates a sales order.
  3. The OEM creates purchase orders that are sent to suppliers of equipment as well as site materials. At the same time, the OEM sends orders to either its factories or outsourced manufacturing partner.
  4. Once a supplier receives the purchase order, it books it as its company's sales order.
  5. As that order gets sent to its distribution center for fulfillment, it is provided with a new name and tracked as a set of picking instructions.
  6. When all the items have been marshaled, the supplier typically associates a third unique name to identify the shipment—a bill-of-lading (BOL) with an additional name for each package. This information is sent to the OEM; then carriers can begin tracking those shipments.
  7. For a large order, the supplier's shipment is usually sent to a staging facility where it can be merged with other items in the order. 8. A subsequent order is communicated to marshal the consolidated items.
  8. As the consolidated items are shipped from the merge center, a new BOL is associated with the material that is reported on by the carrier.
  9. At the job site, the material is received and becomes "visible" to the customer.

Visibility of the "Whole" Order

The challenge of tracking a complex order such as this is that no one company has all the necessary information. Customers don't care how many pieces need to fit together as long as the order is installed by the promised time. The challenge for the OEM is to gain real-time visibility to each step in the process and to respond when events put the promised date at risk.

The need for visibility of the "whole" order, through all its genealogy, is one of the most important initiatives for installation logistics. It requires the integration of data from multiple partners and across all divisions within the OEM. This disparate organization of businesses must act "virtually" as one company to meet the expectations of their common customers.

The end result is much more powerful than a click on the Amazon web site. Whole order visibility, delivered real-time via the Internet, supports the front lines of customer satisfaction through a solid foundation of information and execution.

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