What is order management?

Order management describes tools, strategies, and processes involved in fulfilling customer orders, from initial capture through confirmed delivery.

For a customer placing an order, the entire process may seem like a straightforward two-step system: They make a purchase and then they receive their package. But there’s a lot that happens between clicking the ‘buy’ button and getting confirmation of delivery. Orders placed through your eCommerce platform must be validated and sent through to those who manage your inventory for picking, packing, and shipping. The order then must be tracked and its status updated as it makes its final journey to your customer’s doorstep. 

In other words, from click to conclusion, that order will likely interact with potentially dozens of different processes and tools. And as your business grows and your customer base expands, managing these orders may not be possible without an effective order management system.

An order management system (OMS) is a software platform designed to support effective order management by empowering organizations with more complete control and visibility throughout the lifecycle of an order. High-quality order management systems can track all the information and processes associated with the order management cycle, including:

  • Order capture
  • Inventory management
  • Fulfillment
  • Post-sales follow up (including returns, refunds, feedback, and other support tasks)

With the right order management tools, your business gains the capabilities it needs to access and manage customer orders at scale, all from a single, centralized location easily and accurately. Effective OMS options are likewise designed to integrate with your other essential tools and platform, such as your eCommerce platform, giving you more control and visibility over the entire ordering process.

As previously addressed, there are many different systems and functionalities involved in the order management process. OMS solutions must be capable of aggregating these systems and functions in a way that is both powerful and intuitive. To help you manage your order and track your inventory in real-time, top order management systems include the following features:

Inventory management

Maintaining the correct inventory amounts is a major concern for most online businesses. This includes having enough inventory on hand to meet current demand and forecasting future demand to be prepared for dips and spikes in orders throughout the year. 

Overstocking on inventory is not an effective solution, as it can lead to increased storage costs, displace other inventory from valuable storage space, and lead to dead stock being left indefinitely on warehouse shelves. And understocking can be just as problematic when it results in backorders and delayed shipments.

A good OMS gives you better insights into managing your inventory. By recording historical data and generating easy-to-follow reports, the OMS gives you insight into buying patterns, upcoming trends, and seasonal fluctuations. This can help your business make informed decisions about what kinds of inventory to keep on hand, and in what amounts.

Sales synchronization

Order management extends into the eCommerce sales process, collecting and aggregating sales data for further monitoring and analysis. These sales integrations also connect with inventory management, helping ensure that there is enough stock on hand to fulfill any orders that may be placed across any of your supported channels (eliminating the risk of unanticipated stockouts)

These insights allow you to better coordinate your marketing and sales efforts from a single location. Develop a clearer picture of what is selling and what is not, when specific inventory items are selling, whether there are any geographical variables involved, and which marketing initiatives are having the desired effect.

Order tracking

With the rise in eCommerce and home delivery, order tracking has become more than just a key differentiator; it’s a necessity. Customers want to know where their order is, what day and time it is expected to arrive, and whether they should be prepared for any delays.

With order tracking capabilities, OMS solutions keep a constant check on the order's location and its next steps in the delivery process. Customers can access your system to get important updates and ETA forecasts. And should an order become stuck at an international border or get otherwise delayed, you’ll have the information you need to resolve the issue quickly and get your customer’s order moving again.

Customer support

Proper customer support in order management depends heavily on your ability to keep and access historical order information. When an issue arises—such as a package not being delivered or being delivered late—your customer service team will be up against the clock to track down the relevant order and provide an acceptable solution quickly.

An OMS can help teams locate order information at the click of a button. Many are designed to integrate with existing customer support software and allow fulfillment teams to locate and resolve human errors introduced during the ordering process. And as previously stated, OMS solutions also provide better customer visibility by making it possible for recipients to see the location and delivery estimates for their orders in real-time.

Multichannel/omnichannel support

If you want to get their journey off on the right foot, you need to meet your customers where they are. Forcing customers to make orders through only one or two prespecified channels can harm the customer experience and may drive away potential buyers who are looking for more options.

Omnichannel and multichannel support through your OMS provides a solution. Multichannel support means giving your customer enough options to meet their needs. Omnichannel takes this concept further, by bringing together all available channels to provide a consistent buying experience across every interaction and point of contact—regardless of the channels the customer chooses to use.


As soon as the customer finalizes their purchase, the clock starts ticking. Manual shipping processes slow everything down, adding precious days to your order delivery times. OMS options can cut out many of the time-consuming steps involved in preparing an order for shipment.

Automated solutions within the OMS allow orders to be verified and sent directly to fulfillment center locations. An OMS can also help determine optimal shipping routes and auto generate shipping labels to get everything underway. The OMS will also assist in creating and tracking returns, should a customer decide that they don’t want the product.


A small online business generally has low enough order volume to make tracking and visibility a non-issue. But as your business grows, retaining visibility over your orders can become untenable without the right data analytics tools.

From geographical details to historical insights, order management tools collect and refine order, inventory, and sales data to give you a complete view of your ordering process. Identify strengths and weaknesses in your systems. Analyze and discover the factors responsible for high and low order volume. Improve your supply chain efficiency by identifying bottlenecks and other issues. And apply analytical insights to make data-driven decisions to optimize your shipping strategy.

Customers are the lifeblood of any company. For online businesses, ensuring customer satisfaction means accurate inventory, shipping visibility, and prompt delivery. There is nothing more important than the moment your customer opens their package and successfully completes their ordering journey. But with increased ordering and tracking options, customer expectations have begun to grow.

Order management empowers your organization to meet those expanding customer expectations. Omnichannel support offers a seamless and convenient customer experience and gives them the freedom to make purchases in the way that they are most comfortable (and most likely to follow through). Tracking and analytics place your processes under a microscope, rooting out inefficiencies and reducing your delivery times. Inventory management and sales integrations help ensure that you always have stock on hand to meet demand. And through it all, OMS solutions help coordinate the various teams and systems involved in serving the people who keep you in business.

The result? Increased customer satisfaction, leading to increased orders and more revenue to help grow your business.

Effective order management is an essential investment for any growing or established eCommerce company that wishes to remain competitive. Specific benefits include:

Faster launch of products

Demand forecasting is an integral part of any OMS and is particularly important when preparing for a new product launch. OMS solutions help ensure that the right inventory levels are on hand and ready to ship to meet initial demand and fulfill on preorders.

Shortened times to revenue

Complete visibility into tasks and order line details gives teams the power to find and eliminate inefficiencies across the order lifecycle. This means that agents can accomplish more in less time, bringing in more revenue, more quickly.

Increased customer satisfaction

Customers want fast delivery, but they also want to be kept in the loop. The best OMS options allow buyers to log into their own customer portal to track orders, check estimated arrival dates, and create cases when necessary. By providing these services, order management tools reduce customer frustration and contact volume, increasing their satisfaction with your company and their overall experience.

Although individual organizations may approach order management slightly differently, most will follow the same basic, three-step process:

Order placement

While there are many steps in the order lifecycle that have to occur first, order management doesn’t begin until the customer submits an order with your business. The order is received, payment is collected, and order details are sent to fulfillment staff so that they can locate and prepare the orders for shipment.
Graphic showing the features and functions of Order Management.

Order fulfillment

Most of the order management process occurs during the second step. The customer’s order is fulfilled and—unless there are some significant issues that need to be addressed—the customer receives their delivery. Order fulfillment itself consists of three stages:
  • Picking
    The items included in the order are located from among the rest of the inventory and set aside. Because many online businesses rely on warehousing for their in-stock inventory, the picking process may be extremely complex and involve several teams and strategies designed to optimize how inventory items are located and tracked.
  • Packing
    Packing involves everything related to preparing the items to be shipped. Orders must be packed well so that the items are not likely to suffer damage during transit. The order’s packaging must also comply with all shipping regulations. Finally, packaging resources must be used efficiently so as not to create unnecessary expenses.
  • Shipping
    Once the order is properly packaged, it must be shipped to the customer. Shipping teams are responsible for generating and attaching correct shipping labels, invoicing the order, updating the order status, and sending shipping confirmation and tracking details to the customer.

Customer feedback

Once the order has been received, the last step in order management is to follow up with the customer. After-sales processes include requesting feedback and managing any returns or refunds.

OMS options apply support and automation features throughout this entire process, promoting efficient use of resources, improved collaboration, and unmatched visibility to improve delivery times and customer satisfaction.

Although individual organizations may approach order management slightly differently, most will follow the same basic, three-step process:

There are a lot of steps, tasks, and variables that must be managed before an online customer can receive their order.

ServiceNow Order Management allows companies to manage the order lifecycle more effectively, from order capture, to order decomposition and fulfillment, to post-order servicing, and all on a single platform. Order Management sits atop ServiceNow’s Customer Service Management (CSM) solution to help customers, agents, and fulfillment teams optimize the end-to-end buyer’s journey.

ServiceNow Order Management includes a range of valuable features, including:

  • Order capture
  • Order fulfillment
  • Order tracking
  • Price Lists
  • Product bundles and attributes
  • Product catalog
  • Product detail pages

Optimize your online business; learn more about Order Management vs. CSM, and deliver customer satisfaction with every order.

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