What is order management? A UK guide for procurement leaders

Order management is the end-to-end process that captures, validates, fulfils and reconciles customer orders across procurement, operations and the wider supply chain. With effective order management teams can track orders accurately, monitor inventory availability and reduce delays, errors and work. Without it gaps and inefficiencies quickly create bottlenecks.

This guide explores how order management works in practice, why it matters for procurement leaders and how organisations can improve order visibility, control and productivity by using it.
 

What order management is

Order management covers the entire order lifecycle, from the moment a customer places an order to the point where your organisation fulfils, records and closes it. Each stage exists to keep orders accurate and visible as they move across systems, teams and the wider supply chain.
 

From requisition to fulfilment

The entire process starts when a customer or internal buyer raises a requisition. This step captures what the buyer wants, how many units they need, the agreed pricing and which approval rules apply. Teams document these conditions early to set clear expectations and avoid errors that can arise later in the process.

After approval, the requisition becomes a purchase order. Teams check the order details against inventory levels, supplier terms and product availability then send the order into fulfilment. Fulfilment can involve warehouse picking, dropship coordination or in-store dispatch followed by delivery confirmation and order tracking.

Managing this flow end to end helps teams track orders accurately, keep stock available and avoid hold-ups due to missing or inconsistent order information.
 

Order management vs order processing

Order processing focuses on carrying out specific tasks that progress an order at a single point in time. It keeps individual orders moving, but it doesn’t manage how those steps connect across the broader order lifecycle.

Some of the most common order processing tasks include:

• Confirming order placement

• Updating order status

• Shipping items to the customer

• Issuing refunds or replacements when issues arise

• Sending order and delivery notifications

• Recording completed orders in finance or customer relationship management (CRM) systems.

Order management takes a wider view to connect order placement, inventory management, fulfilment, returns, reconciliation and post-sales activity into a single, continuous process. It keeps orders accurate and under control as they move between systems and teams. With real-time visibility and shared metrics in place teams handle changes, manage exceptions and keep up with growing order volume across ecommerce, multichannel and omnichannel sales.

This distinction matters because most inefficiencies are an order management issue – they appear between steps, not within them.
 

Ownership across procurement and operations

Effective order management requires teams to share responsibility – clear ownership ensures they move orders forward. Procurement sets supplier terms, pricing and approval rules. Operations handles fulfilment, delivery and inventory visibility. Finance relies on accurate order data to reconcile spend, prepare for audits and forecast demand.

It’s also important that teams work from the same real-time inventory and order tracking data. Shared visibility reduces manual follow-ups, prevents stalling between teams and helps organisations maintain control across the order management process.
 

Why order management matters

Order management affects how reliably orders move through the organisation. When processes break down, small issues compound quickly. This creates delays, work and risks that spread across procurement, operations and finance.
 

Reducing errors and delays

Manual steps remain one of the biggest sources of friction in the order management process. According to SSON’s 2025 The Future of Order-to-Cash report, 47% of organisations cite too many manual steps as a major challenge when handling orders. Manual processes don’t just slow orders down – each handoff, spreadsheet update or re-keyed entry also increases the chance of errors.

These types of errors are exceedingly common. In its 2024 Order-to-Cash survey, international business consultancy Clarasys found that 51% of organisations had to correct billing mistakes in more than 26% of their invoices. 

Delay-causing errors often trace back to missing or inconsistent order data from earlier in the process. But structured workflows catch these issues promptly, meaning teams can spend more time moving orders forward.
 

Improving shared visibility across teams

Orders rarely sit with one team from start to finish. When procurement, operations and finance work off different systems or using partial information it’s harder to manage procurement risks. Orders become harder to track, issues arise late and teams spend time chasing updates instead of resolving problems.

Strong order management creates a shared view of order status, inventory levels and exceptions. This reduces follow-ups, prevents duplicate work and allows teams to resolve issues before they slow down internal processes or impact customer satisfaction.
 

Supporting compliance and audits

Order data underpins financial controls. Incomplete or inconsistent data makes it harder to show who approved a purchase, when changes occurred or why someone made an exception.

Clear order management processes create traceable records across the order lifecycle. This consistency supports audit readiness by streamlining approvals and making changes and fulfilment history easier to review without manual reconstruction or last-minute document chasing.
 

Core order management stages

Most organisations follow the same broad order journey even if the tools and terminology differ. These stages help teams spot where orders get slowed down, errors creep in and better structure makes a big difference.
 

Order capture and validation

Everything starts when a customer places an order. Order capture systems record the request, quantity, agreed pricing and approval rules. Validation checks that the details make sense before the order moves on.
 

PO confirmation

Once a customer places an order the organisation confirms it can fulfil that request. This includes checking quantities, pricing and delivery timelines against supplier commitments and available inventory.

This confirmation step is vital because it sets a single, agreed version of the order across procurement, operations and suppliers. When expectations are set early teams avoid issues like disputed pricing or partial fulfilment later in the process.
 

Fulfilment and delivery

At the order fulfilment stage the order turns into action. Warehouse and operations teams allocate inventory, ship or dropship items and monitor delivery progress through to completion.

This step matters because delays, stock issues and miscommunication can occur quickly once fulfilment starts. But when teams see order status, inventory availability and delivery updates in one place they can step in early to reroute stock, adjust timelines or flag issues before a delivery becomes late.
 

Returns and reconciliation

Not every order goes to plan. Customers return items, deliveries arrive in parts or quantities change along the way. Reconciliation brings those outcomes back to the original order so records reflect what actually happened, not just the original request.

This stage matches returns, credits and final deliveries against the original order and purchase order. It closes the loop between procurement, operations and finance by confirming what the customer received, what they should pay or the refund they should receive, all against their original order.

When reconciliation functions well finance teams can trust order data for reporting, audits and forecasting. They don’t have to chase missing information, explain discrepancies after the fact or reopen orders long after they should have been closed.
 

Tools that support order management

The goal of any order management system (OMS) is to strip back complexity to streamline the way orders move through the organisation. Solutions like Amazon Business support effective order management by reducing human error, increasing visibility and helping teams keep pace as order volumes grow.
 

Real-time order tracking

Real-time order tracking gives you a shared view of customer orders as they move through the system. Instead of relying on manual check-ins or updates from multiple providers you can see order status, inventory allocation and delivery progress in one place. This also enhances the customer experience by reducing uncertainty and delays to them. 
 

ERP and procurement integrations

Order management works best when systems connect. Integrating order management software with procurement and enterprise resource planning (ERP) systems lets order data flow without repeated re-entry or manual fixes.

When you can route orders automatically, sync inventory data and share updates across systems, you reduce friction and improve scalability. Integrated routing and inventory allocation also make it easier to make fulfilment decisions as order volumes increase or conditions change.
 

Exception handling

Even with automation order setbacks happen. Stock runs low, deliveries slip and orders can change after customers place them.

Tools that support exception handling highlight these issues quickly. They flag delays, mismatches or inventory shortages so you can step in, adjust allocation or redirect orders before problems escalate. This optimises spend by reducing work, avoiding unnecessary shipping costs and preventing errors that lead to refunds or excess inventory.

Here’s an example of exception handling in practice:

1. Your team places a purchase order for 200 units with a required delivery date.

2. The supplier confirms but later updates the shipment with a partial fulfilment or a delay.

3. The system flags the exception because the delivery date, quantity or inventory status no longer matches the original order.

4. Procurement reviews the alert and sees the impact, such as which sites or projects will be short and when.

5. The buyer adjusts the plan by reallocating stock, splitting the order, redirecting delivery to the highest-priority location or sourcing the remaining units from an approved backup supplier.

6. The system records the change and updates order status so finance and operations stay aligned.

By catching issues early, you avoid last-minute expediting, duplicate orders, extra shipping charges and downstream errors such as refunds or excess inventory. This early intervention depends on having purchasing data in one place. 

With buying activity, order details and fulfilment updates connected, exceptions occur earlier so you can resolve them before orders stall. Solutions like Amazon Business support this by keeping purchasing and order data aligned, without adding manual steps to the buying process.
 

Improving order management

You don’t need a complete system overhaul to optimise your order management process. Most gains come from tightening the basics so orders move the same way every time and teams can spot issues sooner.
 

Standardising workflows

Inconsistent workflows create avoidable work because teams have to interpret each order as it comes in. When people place orders, approve changes or handle exceptions differently, others have to check or correct information before the order can move on. This slows down handoffs and increases the chance of errors.

Standardising workflows gives everyone a shared path for how orders move from request to fulfilment. It reduces guesswork, avoids manual fixes and makes it easier to scale without adding complexity.
 

Tracking KPIs

You can’t improve what you can’t see. By tracking a small set of order management KPIs your team understands where orders slow down and why. Together these signals show whether processes are working as intended or quietly creating friction.

Here are some of the most useful metrics to measure:

• Order cycle time: how long it takes an order to move from placement to completion (long cycle times often indicate approval delays or inefficient handoffs)

• Exception rate: how often orders require manual intervention (high rates usually signal inconsistent data or broken workflows)

• Fulfilment accuracy: how often orders ship correctly and on time (drops here tend to reflect inventory or coordination issues)

• Repeated work due to order data errors: how often teams have to fix or re-enter information (this highlights where missing or incorrect order data creates extra work).
   

Aligning procurement and operations

Procurement and operations work with the same orders but they usually see different parts of the picture. Procurement sets the order up while operations make it happen. Problems arise when those views don’t line up, getting in the way of efficient delivery.

Alignment comes from working off the same order information and knowing who owns what when something changes. When both teams see the same status inventory levels and next steps, they can fix issues quickly instead of bouncing them between inboxes.
 

Turning orders into insight

With strong order management, procurement leaders can move from reacting to issues to running a more controlled, predictable operation. When orders flow through clear processes with shared data your teams spend less time resolving problems and more time taking action. Tools that facilitate automation, visualisation and compliance go a long way towards enabling this.

The key takeaways for improving order management are:

• Clear workflows reduce errors, delays and extra work

• Shared order visibility helps teams resolve issues earlier

• Consistent data supports audits, reporting and forecasting.
  
  

Better order management also supports more controlled spend across customer operations. When teams can see customer orders, fulfilment status and exceptions in one place, they can reduce extra work, avoid costly errors and prevent issues like duplicate shipments or unnecessary refunds. 

Discover how Amazon Business can support your organisation by centralising purchasing and order data, giving you clearer oversight across the order lifecycle as volumes increase.