Chapter Ii (Review of Related Literature)

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Chapter II
Review of Related Literature

Conceptual Literature
What Is the Definition of Order Processing Systems?
by David Ingram, Demand Media
Order processing systems, in one form or another, have been a part of doing business for ages, and have developed alongside technology to provide powerful means of capturing, tracking and shipping customers' orders. Advanced order processing systems can span multiple continents to track and facilitate international orders, shipments and returns for a wide range of product lines and consumer segments.

Definition
An order processing system captures order data from customer service employees or from customers directly, stores the data in a central database and sends order information to the accounting and shipping departments, if applicable. Order processing systems provide tracking data on orders and inventory for every step of the way.

Significance
Customer satisfaction is key to long-term success in business, and fulfilling customer orders reliably and accurately is key to customer satisfaction. Order processing systems help ensure that all of your customers' orders are filled on time, since automated systems can reduce errors in order processing. This can enhance the customer experience and maximize your company's profitability.

Types
Traditional order processing systems are fully manual, utilizing hand-written notes with manual filing systems and reminders. In a one-person shoe repair company, for example, the proprietor may write orders by hand, in person, on an order log sheet. He may take the sheet home with him to make the orders, then bring it back to the shop with the completed order to keep track of who the customer was. Modern order processing systems are largely technological in nature. A designer hat boutique with outlets in multiple countries, for example, is likely to accept orders online, where they are captured by a specialized order processing software package and sent automatically to a third-party manufacturer in another country. The manufacturer may then attach the order sheet to the product when shipping it to the hat shop or it may ship the hat directly to the customer using shipping information from the system.

Advantages
Having a solid order processing system in place creates a win-win situation for businesses and their customers. Customers experience more reliable deliveries and accurate order fulfillment. Businesses can maximize their profitability by not misplacing or misreading orders, not to mention the long-term revenue boost that comes from consistently satisfying customers.

Disadvantages
Highly technological order processing systems can be costly to implement and maintain, possibly requiring additional information technology personnel to ensure that the system functions smoothly at all times. Technological solutions are generally hands-off in nature, since a large number of processes occur in the background of software programs, requiring no input from employees. Because of this, however, it can be much more difficult to track down problems in technology-driven systems than with simpler, manual systems where an employee can personally recall each step in the process.

Considerations
Order processing systems can utilize both the new and old processes, mixing traditional manual methods with technological solutions. A wholesaler, for example, may have salespeople who manually write down order information, then enter the information into a computer software package that automatically forwards the information to the packing and shipping departments.

http://smallbusiness.chron.com/definition-order-processing-systems-3197.html

Define “Purchase Order System”
By Monica Link, eHow Contributor

A purchase order is a system recorded on paper or electronically where a supplier provides a product to a company in the quantity, size, style or color that it needs. A purchase order is based on the sales volume or orders a company...
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