E-commerce operations might be considered as rocket-science.(Not kidding) If you search for the most influential pioneers that changed the way of supply chain in the world (please exclude Ford), you will see Amazon, the biggest and the most famous e-commerce firm in the world.
As being the part of EFB (E-commerce for Beginners series), what you will NOT see in this article are as follows:
- Supply chain management
- Product and process management
- Inventory management
- Quality Management
Those will be part of the “intermediate” articles. For now, please bear with me and take a look at the following visuals that I have prepared for you:
In the image above, my intention was to visualize in the simplest way possible, in order to answer “what exactly does the operation side do?” question. Operation management can have different organization types in different companies. However, there are common divisions that are interrelated with operations
1) Order processing: This is the key step of making money. IT, billing, coordination with warehouse (if it exists) and coordination with customer are the modules of this step.
2) Warehousing (inbound): This is based on the delivery strategy of the company. A company can have cross-docking, drop-shipping, warehousing or the combination of these 3 (Please check the first image below)
3) Production: Once your inbound team got the first samples of the items, you need to have an established system that takes the sample from inbound process until the product is online. It includes photo shooting, content editing and quality check. But these processes differ from company to company.
4) Shipping: Shipping process is the key step that forms the basics of market entry decision, since it contains external factors (shipping companies) and location (country/city) infrastructure. If the shipment infrastructure is insufficient, or if the shipping companies have problems of credibility, competency, accessibility or convenience, than you might think of establishing your own shipping system, which will be the topic for another article.
In addition to those 4, Customer Service might be a part of Operations in some companies. Whereas in “customer-centric” companies, it should be a totally different unit and it should be considered as CEM unit (customer experience management)
Please see the process maps in the image that I prepared below. It might be a good start for theEFC (e-commerce for intermediate) Operations in which I will elaborate those steps. Also please note that this below is just an example of “warehousing” type of a firm.
My next article will be on ops KPIs and how you can use them.