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What Is Order Management? And Why Should You Care?

boxes in a retail warehouse
Once the customer clicks the buy button, order management systems kick in to get the product shipped and delivered. [©MARKO/Stocksy United]

Think of order management systems (OMS) as the conductor of an intricate set of business logic that takes an order from cart to customer.

In ecommerce, few things top the excitement of receiving a package on your doorstep. For consumers, successful delivery marks an anticipated finish line. For businesses, order fulfillment means profitability and continuity. What is order management? It’s everything that makes this experience possible.

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Learn how retailers can increase cost savings with order management.

Order management is an intricate process that ends with a moment of truth — the moment a merchant fulfills their brand promise to its customers. Once the customer clicks the buy button or checks out, order management begins to get the product shipped and delivered.

Consider the journey that your favorite pair of jeans must take to make it to your doorstep or onto a hanger in a store nearby. An intricate series of steps and interconnected pieces must all work together to bring you that “gotcha!” moment when you finally have your denim in hand. The ordering and fulfillment process for a pair of jeans — and for millions of other products — can make or break a brand’s relationship with a customer.

What is order management?

Order management systems (OMS) are everything that happens after the buy button. This includes downstream operational processes, people, systems, and partnerships to fulfill an order. It’s a platform for managing orders, customer records, fulfillment, inventory visibility, payments and invoicing, and customer care. But the foundation of modern order management systems goes even deeper.

Customers expect the whole process to work seamlessly, from the moment they check out to when they receive their order. They also want complete transparency around order status. Consumers and B2B buyers want to know if there’s a problem in transit, and they want transparency on location and hassle-free returns.

So what happens after a customer hits the buy button?

Once upon a time, order management systems were relegated to back-office systems, typically within the logistics division of a company. But that doesn’t work in a customer-centric economy, because order management is so central to the overall customer experience. Everything brands have done in the customer relationship management (CRM) lifecycle — awareness, marketing, site experience, consideration, acquisition, conversion, and more — leads to this one moment. In fact, order management is the most important moment of value exchange. If brands fail to deliver on their end of the value exchange (money for goods and services rendered), does anything else that came before really matter? Order management systems must deliver on that brand promise.

So what happens after a customer hits the buy button? Once a buyer begins checkout, an intricate dance begins to carry out the order. Storefronts may interact with up to 39 different systems to complete an order. The most common are tax, payment, fraud, inventory management, accounting, enterprise resource planning (ERP), and shipping. Here’s the step-by-step process:

1. A merchant must have an accurate view of inventory counts to prevent sell-throughs and overstocks

This view helps inform shipping origin, as products can be shipped from multiple locations, or split across multiple warehouses, showrooms, distribution centers, stores, or even a third party.

2. After confirming inventory, check for order routing

Are the products or shipments standard? Or, is there a customization process that may route to a specific warehouse? For special orders, a team may need instructions to construct a personalized product by hand.

3. Next up, shipping integrations

Fast and flexible shipping options are critical to earn loyalty and trust. In fact, 57% of shoppers said that same day delivery will make them more loyal to a specific brand. B2B buyers’ expectations are also rising. They now expect the same options as consumers. According to The State of Commerce, approximately 40% of B2B online sales are from digital channels.

4. Last, there’s delivery

Once the items have been picked, packed, and prepped for shipping, payment is captured, and the goods are on their way to the customer.

Order management is the brains behind each step in the fulfillment journey for both B2C and B2B customers. Think of it as the conductor of an intricate set of business logic and workflows that take an order from cart to customer.

Transform the customer experience with great order management

Order and fulfillment are at the heart of an exceptional shopping experience. Next-generation order management systems are customer-centric and integral to the front office. Why? Because these moments in the shopping journey can either annoy or amaze customers. They help determine whether a customer completes a transaction and becomes a loyal customer, or clicks over to the competition. Let’s look at some of these moments.

Provide flexible shipping/delivery options

Customers demand flexibility in shipping and delivery – from one hour in metro areas and weekend delivery to in-store pickup and next-day delivery. They expect these options to be displayed clearly on the product page. Without a modern order management solution, companies are faced with two choices: opt for a quick fix by building necessary features or simply buy a system that builds differentiating features.

According to a recently commissioned Forrester Total Economic Impact of Salesforce Order Management Study, customers experienced a 75% reduction in development time when building new order management features equivalent to $1.1 million in cost savings. 

Provide accurate product availability information – including location

Don’t disappoint and frustrate your customers with an out-of-stock notification after they’ve added an item to their cart. For business buyers, time is money – and any minute spent shopping for out-of-stock merchandise is wasted. If a product is out of stock or running low, state so on the product page to give customers the most accurate view of available inventory.

Offer self-service order status and returns

Customers should be able to check order status and receive updates on their terms, including text and email updates. They should also be able to change shipping details. Returns, too, should be self-serve, including printout return labels and choosing how and where to return an item.

Empower service agents and sales reps

Service agents and sales reps are on the front lines of the customer experience. They need to assist customers with their orders in every way possible. That requires complete visibility into orders and customer activity. Technology should help them to place orders on behalf of customers and make shipping/delivery changes to existing orders.

Integrated order management systems drive operational excellence by orchestrating the entire supply chain. Everything that a brand does in the customer lifecycle leads to this value exchange moment with their customer.

Get started with an order management system

OMS isn’t just about processing orders. It integrates customer-facing systems that impact the post-purchase experience, including ERP, CRM, sales, service, and commerce, for example. OMS makes everything available and accessible to all stakeholders in a unified platform.

At Salesforce, we call this customer-centric order management. We drive this sea change with Salesforce Order Management, a flexible OMS built to support omni-channel journeys at global scale. It works with Salesforce CRM for a complete data record, it’s pre-connected to Commerce Cloud, and it natively supports Service Cloud and Sales Cloud for a single customer view of both order and transaction history. It’s also part of an ecosystem that supports thousands of pre-built connectors, all leading to faster time to value and, more importantly, happier customers.

Excited about order management yet?

Learn to power amazing experiences after the buy button, connect with customers, and build brand loyalty.

Luke Ball VP of Product Management

Luke Ball is a VP of Product Management. In his years at Salesforce, Luke has led product and/or user experience in a number of different areas, including Social Studio in Marketing Cloud, Chatter and Community Cloud, Search in Platform, and now Order Management in Commerce Cloud. Luke lives in Berkeley, Calif., with his wife, two daughters, a yellow Labrador Retriever, and a minivan.

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