Distributed Order Management basically the consideration of all companies involved in an order as well as the responsible personnel. Producers, logisticians, suppliers and dealers try to solve questions about tasks or orders that are to be processed in parallel: So-called information breaks (no transparency), for example in stocks, storage locations, sales and procurement channels, are to be avoided.

Distributed order management, also known as Cooperative order management, takes all partners in the supply chain into account. There is no prioritisation of task areas, but rather the participating companies make their information, for example, information from intralogistics, available to the partners. This concerns procurement, production, transportation and invoice processing, including the coordination of deliveries and billing (invoicing) across several partners, as well as the coordination of complaints processing.

Distributed order management vs. Classic order management

Important: Distributed order management is based on barrier-free process and information flows. Its characteristic feature is distributed and well-networked order processing, in which internal and external company departments, also known as business units, align their services to customer needs (1).

Example: Trading companies often use the possibility of delivering bulky goods that are expensive to store directly to the customer through third-party suppliers. Advantage: The supplier himself does not have to keep this type of goods in stock and can still offer a wide range of products. In order to ensure smooth communication and information flow (collaborative commerce) between the partners, it makes sense to connect the supplier directly to the webshop. In this way, the supplier is in informal contact with the manufacturer, who can arrange for replenishment and new production immediately after order receipt/order.

Note: Distributed order management is contrasted with traditional order management. It comprises all organisational processes that take place “within” a company in connection with “one” order. External companies are not necessary for processing.

(1) Cooperative order management. Architecture, practical examples and potential benefits – Dissertation by Dimitrios Gizanis, University of St. Gallen


For more information on order processing, see “Order disposition in intralogistics” and “Order throughput time“.

Teaser picture: DOC RABE Media – Fotolia.com

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