order processing

2. Order Processing

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This video has been created by Mr. Shantanu Trivedi.

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This video is a part of the Logistics fundamental and Processes course (MBAP-921D).

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• The video discusses the order processing and its importance
• It provides the understanding of documentation related to order
processing and customer response system

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Order processing is the set of activities occurring between order entry and order
release to the warehouse. Order processing activities include
Order pattern recognition
Credit verification
Order status communication and order changes
Order batching and assignment for efficient transport and picking
Order Processing

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Order Pattern Recognition
• Order pattern recognition identifying requests for unusual items or quantities by a
customer yields big customer service and inventory management dividends.
Credit Verification
• For individual consumers, credit verification should take place before order release and
inventory commitment. Credit verification should take place online and in near real-time.
Order Batching and Assignment
• Orders should be assigned to their optimal shipment and pick wave. The optimal shipment
assignment (to a mode, carrier, and specific shipment) minimizes transportation cost yet
satisfies the customer’s response time requirements.
Order Changes and Status Communication
• Customers and consumers should be allowed to change orders until the loading of the
order into the transportation container and/or until the point the change will delay the
entire shipment.
• Order changes outside those parameters should be entered as new orders.
• Order status communication should be proactive when there is an exception to the order
contents, timing, or terms agreed upon at order entry.
• Order status information should be updated in real-time and should be available
perpetually to the customer/consumer either by phone or online.

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Order Picking Technology
• Order picking technology, such as pick-to-light, put-to-light, and pick-to-voice are
widely known to improve picking accuracy and efficiency.
• These technologies can be fully integrated with a warehouse management system
(WMS) as well as RF scanners.
• Larger companies are experimenting with drones, robotics, virtual reality, and
augmented reality, but these newer technologies are still too expensive for the
average warehouse[

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DOCUMENTATION, INVOICING, AND COLLECTIONS
• Documentation is made perfect by eliminating paperwork, handwriting, and key entry
throughout the order flow documentation process.
• Ideally, all customer orders, transportation documents, picking documents, and invoices are
electronic and the number of required documents is minimized.
• When possible, collections should be immediate, permitting multiple payment options. Again,
a bigger net catches more fish.
CUSTOMER RESPONSE SYSTEMS
• Modern vernacular for a customer response system (CRS) is customer relationship
management (CRM). For all the reasons outlined previously, CRM software is one of the
hottest software market spaces.
• The CRS is one of five subsystems in a logistics information system.
• The functionality in a customer response system includes
• Order entry
• Order processing
• Contact management
• Customer activity profiling
• Order pattern recognition
• Customer transaction databases
• Open order databases