Q&A with Alora Chistiakoff, Director of Commerce Services
We caught up with Alora Chistiakoff to discuss the challenges retailers are facing and the best practices around omnichannel order management and fulfillment. Here is a summary of what we discussed.
What are the challenges to fulfilling orders across multiple locations?
Alora: For retailers, there’s rarely one single source of truth for inventory information. There’s inventory from the store (in a POS), warehouse (in a WMS), drop-ship inventory (in purchase orders), in-transit, on-order, on-demand, etcetera. To accurately understand fulfillment options, all of these pieces must be brought together into a single source, such as an order management system (OMS).
The real-time nature of this information is particularly important for retailers. A given warehouse might not be able to fulfill an order during a morning wave, but could put everything in place to ship the order later that afternoon.
They must quickly decide which is more important: getting the order out from the closest distribution center in the afternoon, or sending it in the morning from a location farther away at a higher shipping cost. Having sophisticated order orchestration capabilities is critical for this.
How can retailers correctly let the shopper know when their order will be delivered?
Alora: Setting clear expectations about delivery timelines is only possible once a retailer has a high degree of confidence about the location of all inventory at all times, as well as special shipping requirements of different types of products.
Any mature distribution center has well-understood metrics regarding standard turnaround times. These numbers can be built into order management system workflows to provide a projected estimate for handoff to a delivery service. Once the order leaves the distribution center, integration and communication between the order management system and third-party shipping and delivery partners can provide accurate status information and updates.
What factors must a retailer take into account to ensure they are meeting their delivery commitments to their customers?
Alora: To meet delivery commitments consistently, retailers should have four key components in place:
- Detailed, accurate, and real-time inventory orchestration capabilities
- Deep integration with shipping providers
- Robust communication services to provide meaningful updates to the customer with end-user control over the messaging
- Seamless integration into the ecommerce platform for maximum visibility and customer self-service
How can retailers improve poor integration between systems and poorly synchronized inventory and customer data to create a seamless omnichannel shopping experience?
Alora: The most common obstacle to a retailer’s omnichannel objectives is typically rooted in legacy enterprise architecture, including traditional ERP systems. These were not originally designed or implemented to support the 24/7 expectations of a digitally-driven sales process. Real-time inventory is at the heart of omnichannel, so IT systems must be able to keep up.
This requires a robust middleware layer to help with the transformation and movement of data for multiple systems (OMS, WMS, POS, etc.). Without this layer, retailers may face challenges around scalability and flexibility, making omnichannel capabilities impractical to manage.
How can having the right system in place help retailers reduce costs and orchestrate complex order fulfillment processes across their network of customers, partners, and suppliers?
Alora: The key is an order management system, such as the IBM Sterling Order Management System, that can automate numerous processes and rules, while presenting inventory information in real-time to all of the right systems.
It should have sophisticated order orchestration capabilities, including: sourcing rules that allow different channels and locations to share inventory; the ability to drop ship from partners for merchandise that is not realistic to keep on-hand; fulfillment of web orders from stores; and direct-to-consumer shipping from the closest possible location.
Furthermore, with capabilities like bundling, retailers can manage components that may be assembled on-demand for customized finished products. These capabilities reduce inventory carrying and storage costs, shipping time and costs, return rates, and customer service costs, which can have a huge impact on profits and customer satisfaction.
Learn more about omnichannel order management solutions, and download this Q&A, along with an omnichannel order fulfillment infographic from RIS News.
