Accelerate the Order-to-Delivery (OTD) Capability Transformation, Improve Customer Experience and Enterprise Competitiveness
1. The "order to delivery" capability plays an increasingly significant role in the success of an enterprise due to the customer-oriented domestic market transformation and increasingly fierce competition:
In most industries, the internal functions of an enterprise can be divided into two categories: “front end” and “back end”. "Front end" generally refers to business functions that face customers, such as marketing, customer relationship management, and sales; while "back end" generally refers to the entire process from order received by the enterprise to product delivery, which creates the concept of "order to delivery" (hereinafter referred to as "OTD"). It covers a series of functions and processes such as product R&D definition, demand forecasting and sales & operations planning, resource allocation, order management, production planning and scheduling, manufacturing, logistics and transportation, and product delivery. With the Chinese market is shifting from "production-oriented" to "customer-oriented", OTD capabilities have become a decisive factor in the success or failure of companies in the highly competitive Chinese market.
Taking a broader view to the domestic market under the influence of the Internet, the 2C enterprises, on the whole, have begun to drastically improve OTD capabilities. What’s more, based on Deloitte’s industry insights, leading 2B enterprises have also begun to pay attention to the improvement of OTD capabilities and regard it as the key to future competitiveness.
2. Enterprises will face different kinds of challenges, traditional functions solely improvement will contribute limited influence, enterprises should stand in whole picture scope to find suitable point to make sure OTD capabilities could be fundamentally improved:
OTD covers a considerably wide range of areas, in which enterprises will encounter different challenges in each link. Some typical problems are listed as follows:
Compared with the problems in the various process links listed above, a prominent challenge for most enterprises currently is the lack of proper internal organization and talents which can guarantee end-to-end perspectives and capabilities, resulting in the inability to coordinate the overall situation and accelerate the transformation of OTD capabilities from the perspective of the entire enterprise.
Enterprises should stand in whole picture scope to find suitable point to make sure OTD capabilities could be fundamentally improved. To make a breakthrough in a conflict between the front and back ends, it is imperative for enterprises to look at the problem from the perspective of maximizing end-to-end benefit, and hit a balance between sales achievement and operating efficiency through rigorous analysis and argumentation to ensure both customer satisfaction and business development.
3. Deloitte provides four-in-one comprehensive professional services in OTD capability transformation, including top-level model design, process reengineering, high-level data analysis application, and construction and implementation of IT system, and relies on its unique advantages to ensure that the enterprise gains the greatest business benefits in the process of transformation:
With the experience accumulated over the years, Deloitte has formed a unique four-in-one methodology and service capabilities in the field of OTD capability transformation:
- Top-level model design: As the first step of OTD transformation, top-level model design plays a key guiding role in the implementation of specific processes and systems. The top-level business model design requires comprehensive consideration of customer and market demand, in combination with the company's own strategic positioning, to formulate high-level OTD operating principles.
- Process reengineering: Process reengineering is a process to refine the top-level design. First, it is necessary to identify the points for improvement in the existing process and the interdependencies, and measure the potential benefits, which can help determine the focus and priority of the process reengineering. In addition, the process design itself is divided into multiple levels. The high-level process design is usually used to clarify the general process steps and define the responsibility boundaries for different business departments, and the detailed process design needs to provide sufficient daily work guidance for colleagues at the operating level.
- High-level data analysis application: It refers to the application of digital technology in each process link, especially high-level data analysis capability, to achieve process automation and automated analysis and decision-making. Under the wave of digitalization, digital technology has inevitably penetrated into all aspects of our lives. Compared with traditional process improvement and method changes, sufficient utilization of digital technology can usually help us accomplish more with less effort and even bring disruptive effect.
- IT system construction and implementation: A powerful IT system that meets business demand is a key element to ensure efficient processes. Deloitte has formed a partner ecosystem with many domestic and international leading IT system solution providers in the OTD field to provide our clients with one-stop system construction solutions or all-around services, including order management system, sales & operations planning system, production scheduling system, production execution system, logistics and transportation management system;
The unique advantage of Deloitte is the ability to render four-in-one services, which helps our clients obtain the guarantee of business performance improvement. Abundant expertise and experience of whole value chain enables us to complete the overall end-to-end transformation. The focus on business performance allows us to always convert methods into actual benefits. High-level data analysis application enables us to achieve more with less effort. The talent pool of all processes allows the scope of our support to cover the whole process from design to implementation.
4. Deloitte’s OTD capability transformation service has been well proven by successful projects of industry-leading companies, and has achieved extraordinary results in the improvement of major operating indicators:
Deloitte places business indicator improvement front and center in every OTD capability transformation project. Thanks to the four-in-one methodology and end-to-end design and implementation capability, the OTD capability transformation projects are usually able to bring direct and visible increase in customer service levels and solid improvement in operating performance to enterprises, which is mainly reflected in: