F. Curtis Barry & Company Blog

I’ve had two extensive projects with two new installations of a commercial order management system. While it may raise questions about how prepared companies are as they embark on implementing systems, I think that everyone can learn from them. Let me share with you some highlights:

The first is a company with sales of $75 million annually; evaluated both Tier 1 ERP and order management system capabilities. This company selected a large scale Windows-based client server system. What were some of the issues?

As we have written many times, 50% of large scale implementations end up over budget and well behind the original proposed implementation schedules. Typically, we have always identified investment in several areas: hardware, operating software, third-party software, professional services and applications licenses. In order to plan initial new system implementation budgets for large scale order management system and enterprise resource planning systems (ERP), it’s prudent to go well beyond these categories of expense and engage in broader based planning and due diligence.

You have just spent many months doing your due diligence to replace your aging order management system: gathering user requirements, writing an RFP, getting capable system vendors to bid on it, conducting demos and selecting the finalist. Yet there is one more activity that, if not done superbly, will shake management’s confidence that implementation of the new system will go smoothly.

If you haven’t adequately studied and documented how management, at every level from CEO to department managers, will get the needed information they’re used to having - your credibility could be in trouble. We are talking about the necessary reporting and key performance indicators needed in order to run the business on a daily, weekly, monthly and year-end basis. Even when business analysts feel they have done an adequate job of determining user requirements, the reporting functionality frequently gets cut short. There are a variety of reasons for this:

In most businesses the transition to a new order management system (OMS) does not occur frequently. One of the main keys for your OMS implementation to be successful is to be sure you have tasks and assignments for developing training materials and standard operating procedures. The new OMS will affect the productivity of many departments, including contact center, distributoin center, accounting, merchandising, marketing and management reporting.

Some companies often struggle for six to eight months after implementation to regain their productivity and proficiency levels. Here’s how your company can shorten the order management system learning curve.

The major software companies, especially enterprise wide systems from Microsoft, Oracle (JD Edwards EnterpriseOne), Sage and SAP, have made huge head ways into the order management system marketplace for moderate to large e-commerce and catalog companies. It’s important to remember that the ERPs have a development legacy outside this marketplace. In most cases these software companies reply on Business Partners or Value Added Resellers (VARs) to develop industry specific functionality which gears the base ERP to your order management, distribution, marketing, merchandising, etc. requirements.

To sell to widely different market niches, today’s ERP systems have flexible configuration set up and often “layers” to provide standardization of functionality and unique requirements at the same time.

In case you missed the first post where Steps 1 and 2 were discussed, we encourage you to read them. As a summary, Step 1: Organize the Project Internally and Step 2: Define Your Requirements.

Here are Steps 3 and 4:

Step 3: Evaluate the Vendors
In your Request For Proposal (RFP), make sure you specify that bidders include in writing all of the pricing, warranties and schedules for the order management system; the software and any hardware to be provided; pre-installation training; modifications required before and after installation; a list of other packaged systems that have been successfully integrated with; and file conversion and maintenance support.

Whether your company is in need of a commercially packaged warehouse management system, point of sales system, inventory control system, direct-to-customer order management system --or some combination of the aforementioned, the selection of the right system is a major undertaking for your business. No matter what type of new system you’re considering, that purchase is going to be a long-term investment. It has significant ramifications for how you serve your customers, the productivity of your personnel, and the management information it can provide to help you manage and grow your business.

To make an accurate system assessment and choose the right system for your company’s needs, we recommend you follow a four-step selection plan. This plan includes:

1. Organizing the project;

2. Defining your business needs;

3. Gaining a complete understanding of the vendor’s systems and capabilities; and

4. Examining the expected ROI of the system.

After installing a new order management system; we find that most are utilizing less that 50% of their system's full potential. This is true for many reasons; especially since training was probably a while ago and personnel do not remember all of the different options that are available to them.

Since most order management system implementations are a significant capital investment, shouldn’t you be looking at taking advantage of other functionality to improve business processes? The answer is a simple yes, you should be looking at utilizing your new software application to its fullest, in order to maximize the investment and improve and simplify your business processes. 

The best time to assess your current order management system infrastructure is now. We have listed some questions below to see how your system fairs.