Customers are becoming more and more critical and demanding regarding online purchasing as the Web revolution sweeps through industry after industry. Not only is the Internet dramatically accelerating business processes, it is also increasing the complexity, as customers demand improved purchasing capabilities, increased product selection, and ready availability of customer support and order tracking. In order for organizations to meet these challenges, many are looking to an “online order management” strategy.

Online order management extends an organization’s internal order entry applications to the Web in order to facilitate order acceptance online. By implementing this capability, vendors can offer products and services in real time, drastically increase geographic reach and supply customers with 24-hour-a-day order entry capabilities,all at a lower operating cost.

At the same time, customers reap numerous benefits. The creation of a streamlined-easy-to-use ordering system means orders and information queries can be completed quickly and efficiently. Customers can get timely, accurate information about products or order status , such as suggested substitutions for out-of-stock or discontinued items , without waiting to speak with an operator. Most importantly, customers can conduct business in real time, and on their time without sacrificing service quality.

The benefits of online order management are significant to both the seller and the buyer in the Internet marketplace. Vendors can make the move from brick-and-mortar to click-and-mortar, attaining new levels of competitiveness in their industries, while customers save precious time placing, checking and receiving products. If we grant the strength of these benefits for a business, the question then becomes, what’s the best, most-time and cost-efficient way to realize them?

Do I Build or Buy?

When evaluating e-commerce systems, many organizations grapple with the decision of designing and building a proprietary system using a set of development tools, or buying an “off-the-shelf” product and integrating it. The key issue in this decision is control, control over the concept, design and implementation of the system versus the organization’s ability to answer market demands, control costs and revenue. To make the best choice for a business, executives should weigh:

Time-to-Market

Budgetary Constraints

Features/Functionality Requirements

Current Information Technology Infrastructure

For example, a packaged solution,which may take the form of an electronic catalogue, transaction server, or other application,might be ideal for an organization for which time-to-market needs are a high priority. However, it is important to remember that even these products may require some additional customization, as well as integration to back-end systems. In addition, a packaged solution is only as successful as the backend system to which it is connected. If the package solution you are evaluating does not provide sufficient means to connect to and embrace your current environment, then you should probably consider other products and vendors.

The second option, a customized solution, allows for advanced features and functionality that may help a business better transition from a traditional to an online order management system. If your infrastructure is comprised of numerous proprietary and custom applications (or legacy systems), it will usually make most sense to extend these applications to the web using a variety of custom application architectures.

Keep in mind that neither the customized or packaged approach is inherently right or wrong. To determine what’s right for your business, you’ll have to make a thorough analysis of you company’s business needs and processes. And for this level of advise, your best resources are seasoned, third-party technology consultants. Not only can a technology expert assist you in weighing business needs against the features of each approach, they can smooth the integration of either solution into your organization’s current business and technical environments.

How do I tackle an online order management initiative?

Make a Plan

Create an action plan for moving forward. Identify goals and criteria by which you can measure returns for executing this initiative, and identify key stakeholders in the organization (not just Information Technology personnel) whose business processes or company functions may be impacted by the undertaking.

Select an IT System Integration Partner

If your organization is like most, e-commerce is uncharted territory. If you do not have the internal talent to execute an online order management initiative, you should look to a proven Systems Integrator/Information Technology consulting company to help. The primary qualification for such a vendor is a proven track record of e-business implementations and of leveraging and extending complex legacy systems. In addition, select an integrator that thoroughly understands web technologies and can help execute your initiative in an aggressive time frame.

Determine on a Package vs. Custom Technology Approach

A good IT partner can help in assessing your internal infrastructure and business needs to determine if a package selection is a sensible purchase and to identify the best choice among package candidates.

Use a Phased Approach:

A phased development approach is a common way to implement such a system. Rather than waiting for a complete set of features, most organizations roll out this functionality in the following controlled releases:

Order Acceptance This is the ability to create a shopping cart experience and complete an online transaction on your site. In addition to capturing the order, this phase should ‘inject’ the transaction into the business systems currently used for order processing and fulfillment.

Order Status Once customers place an order, your system should allow them to check that order’s status online. Once again, this involves reaching into current systems and extending this information to the web.

Inventory Status This feature should allow customers to check a vendor’s inventory level prior to completing a transaction.

Cross-sell and Up-sell Pricing Configurations In addition to allowing customers to view inventory, the online order management system should employ business logic to suggest alternate products if a particular item is depleted. This highly interactive feature saves vendor-organization time and money in terms of alternate sourcing.

In the end, online order management is a critical means by which business can achieve better customer acquisition and retention rates, across-the-board savings, and increased efficiency. How you implement this technology is critical to success in the online marketplace. In choosing the best route to a successful online order management system, it is advisable to team up with a qualified technology consulting firm. An outside expert in systems integration can weigh an organization’s business needs against each facet of the implementation and guide you to the products, functions, and features that will expand your ad keep it thriving in the “New Economy”.

Jim Maza is the Director of SEI’s e-Business Practice. Mr. Maza provides business, technical, and marketing leadership for the practice, builds e-Business accounts, and superintends project efforts.