Processing orders efficiently leads to increased customer satisfaction, reduced costs, and a shorter cycle time.

 


When a customer places an order, order entry begins. Next is order handling. The order moves to a warehouse to verify the product is in stock. If the product is not in stock, it is back ordered, and the customer is notified of the delay. The customer is offered a substitute or the order is cancelled. If the customer prefers to wait for the product, or if the product is in stock, the finance department confirms the customer's credit and/or payment as well as the prices and terms of sale. When the product is available, it can be assembled. After assembly, order delivery occurs. Shipment is arranged with a carrier. During this step, inventory records are adjusted, the customer is sent an invoice, and the order is delivered to the customer. Some of the order processing steps may be completed concurrently.

Technology has an increasingly important role in these processes.