Order Processing and Information Systems

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Presentation transcript:

Order Processing and Information Systems CHAPTER 4 Order Processing and Information Systems

A Customer's Perspective Total Order Cycle: A Customer's Perspective Key: 1. Order preparation and transmittal 1 days 2. Order received and entered into system 1 day 3. Order processed 1 day 4. Order picking/production and packing 1 days 5. Transit time 3 days 6. Warehouse receiving and placing into storage 1 day Total order cycle time 8 days 1. Customer places order 6. Order delivered to customer 5. Order shipped to customer 2. Order received 3. Order processed 4. Order picked and packed

Total Order Cycle with Variability 2. Order entry and processing Frequency: 1 2 3 1. Order preparation and transmittal 1 2 3 3. Order picking or production 1 9 TOTAL 3.5 days 8 20 days 5. Transportation 1 3 5 6. Customer receiving .5 1 1.5

The Path of a Customer’s Order Warehouse withdrawal Inventory file Production schedule Check credit available Ship customer order Customer delivery Order transmittal Enter Invoice Back Transportation scheduling Shipping documentation Process

Traditional Supply Chain Flows Demand flow Product flow Supplier Retailer Distributor Manufacturer

Information-based Supply Chain Flows Timely, accurate information flow Supplier Manufacturer Distributor Retailer Smooth, continual product flow matched to demand

Definition of EDI Interorganizational exchange of business documentation in structured, machine-processable form. Unstructured Structured Fax EDI E-Mail Order entry Person-to-person Computer-to-computer

EDI Versus Traditional Methods BUYER'S PURCHASING APPLICATION SELLER'S ORDER ENTRY APPLICATION PURCHASING POST OFFICE BUYER'S COMPUTER EDI FLOW P O SELLER'S ORDER ENTRY Source: Margaret A. Emmelhainz, Electronic Data Interchange: A Total Management Guide (New York: Van Nostrand Reinhold, 1990), p. 5.

Typical EDI Configurations Manufacturer Supplier Third- party vendor Proprietary system Value-added network (VAN) SOURCE: GE Information Service, as reported in Lisa H. Harrington, "The ABC's of EDI," Traffic Management 29, no. 8 (August 1990), p. 51.

Decision Support System User data-bases Information results Public data- bases Data acquisitions Data preprocessing Planning/ analysis models User inputs Data presentation Data processing Operating

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