What is an OMS?

OMS system imageOMS is an acronym that you often hear if you are in the fulfillment or direct response industry.  What does it mean exactly?  Let’s start with what it stands for.  OMS is short for Order Management System or Order Management Software.  According to Wikipedia,  OMS is defined as computer software systems used in a variety of industries for order processing and management.   Another common title for this type of software is ERP (Enterprise Resource Planning) .

To be more specific, it is generally understood that order management systems are intended to function as the hub for processing all orders.  Each order must flow through the system which allows users to bring orders into the system, edit and process orders and integrate with shipping systems.  Below is a summary of each step in the history of an order as it passes through an OMS and the capabilities you should look for:

  • Order input – Orders can be imported or input into an OMS in a variety of ways.  The most basic method is to hand key the order in.  This is most common for low volume sceanarios as well as in B2B situations.  Ideally, orders would be automatically imported from the various order sources.  These include e-commerce shopping carts, call center feeds and EDI interfaces.
  • Address Verification – Today, most order management software is capable of verifying addresses before allowing orders to proceed to shipping.  Without this step, any shipping operation will be allocating uneccessary labor to customer service and return management as incorrect addresses cause a lot of problems with shipments.
  • Payment Authorization – In today’s e-commerce climate, credit card processing has become more and more specialized.  PCI compliance is required and many order management systems are not capable.  Most transactions are taking place in the online shopping cart.  It is more common to see OMS credit card processing when the order source is a call center which only authorizes the transaction and requires capture after shipment. 
  • Back Order Management – It is inevitable that any order management operaton will face back order situations.  Any capable OMS should have robust back order management capabilites.  As back orders arrive in the OMS, users should be given the option to hold and ship the order complete or to split the order and ship what is in stock.  In situations with high numbers of SKUs, this management must be automated as details can become convoluted very quickly.
  • Pick, Pack & Ship – Most order management software also functions in some degree as a WMS (warehouse management system) as well.  In some cases seperate systems can be used for these two functions.  Ultimately inventory counts and order routing must be handled somewhere.  Ideally both aspects of order management can be handled in one system.  It is common to integrate to shipping vendor software such as UPS Worldship, FedEx Ship Manager and USPS through Endicia.
  • Data Analysis and Reporting – Since your OMS is going to be the hub through which all of your orders are managed, it makes sense for it to have detailed reporting capabilities.  It is important to quickly and easily generate reports on inventory, order shipment summaries, items shipped summaries and shipping cost summaries.
  • Customer Service – It is imperitive that any OMS allow for easy access to order details for customer service representatives.  Whether you outsource customer service or handle it in house , your OMS should allow for multiple users to lookup order info, makes changes, make cancellations and process returns.

One thought on “What is an OMS?

  1. Pingback: 4 important steps for integrating your OMS with an e-commerce platform | Order Management Software Blog

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