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Order Management: A Core Competancy

  • ID: 42757
  • Report
  • January 1997
  • 95 pages
  • American Productivity & Quality Center, APQC
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The purpose of this multicompany benchmarking study was to identify and examine
innovations, best practices, and key trends in the area of order management
(OM) to gain insights and learnings about the process. This enabled participantsto direct their own order management process more effectively and identify any performance gaps. It also afforded them the opportunity to gain a better understanding of the issues and challenges involved in improving and reengineering the order management process. Fifteen companies participated in the study by attending a series of planning sessions, completing data-gathering surveys, and attending or hosting on-site interviews. Of those 15 companies, 11 sponsored the study (“sponsor companies”) and four were identified as having a strong or innovative order management program in place. These four were invited to participate in the study as benchmarking partners (“partner companies”).

REPORT STRUCTURE AND STUDY KEY FINDINGS

This report has been organized into three macro topics:
1. Breaking Down Silos/Barriers
2. Monitoring the Perfect Order
3. Gaining a Competitive Advantage

FINDINGS OVERVIEW

Much transformation has occurred within the order management process over
the last three years. The increasing demand for reduction of cycle time and cost and the need to meet or exceed customer expectations have forced companies to revamp their OM processes. This has prompted management to break down functional silos, invest in technology, and integrate peripheral activities to create an end-to-end order management process. Managers are asking themselves such questions as “How can I reduce cycle time and/or achieve a one-day cycle time turnaround?” or “How can orders be processed more efficiently with less risk of customer dissatisfaction or errors within an order?”

METHODOLOGY

The consortium benchmarking methodology was developed in 1993 and serves as one of the premier methods for successful benchmarking in the world. It is an extremely powerful tool for identifying best and innovative practices and for facilitating the actual transfer of these practices. The data collection tools used to gather information include both questionnaires and site visits. Three questionnaires were used—a screening survey designed to identify successful order management systems, a detailed questionnaire designed to collect objective and quantitative data, and a site visit questionnaire designed to collect qualitative information about targeted aspects of order management processes.

The four partners hosted half-day site visits, allowing sponsors to meet with key personnel and learn about the partners’ order management strategies and practices. A group of consortium members attended each site visit in order to participate in the discussion and to experience different programs firsthand. Both partner companies and sponsors responded to the screening survey and detailed questionnaire. Only partner companies were asked to respond to the site visit questionnaire. Secondary research conducted by APQC was used to help select innovative companies.
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- Sponsor and Partner Companies

A complete listing of the sponsor companies in this study, as well as the best-practice (“partner”) companies that were benchmarked for their innovation and
advancement in order management.

- Executive Summary

A bird’s-eye view of the study, presenting the methodology used and the key findings discovered throughout the course of the study. These findings are explored in detail in following sections.

- Key Findings

An in-depth look at the 10 key findings in three macro topic areas: Breaking Down Silos/Barriers, Monitoring the Perfect Order, and Gaining a Competitive
Advantage. Organizational examples and graphs of bestpractice partner data provide supporting evidence for the findings.

- Partner Company Profiles

Background information on the partner companies, as well as their innovative order management practices.
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