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Order Management Cost measures a company’s expenses related to the creation and maintenance of orders, order documentation, customer credit and invoices. Example costs include: Order management labor cost, automation cost, property, plant & equipment cost and order management governance, risk and compliance costs. The Order Management Cost Ratio compares order management costs to total sales revenue.

Order Management Cost
=	Order Management Cost   × 100 % Total Revenue

Where

• Order Management Cost = Total annual order management costs
• Revenue = Total annual supply chain revenue

Unit of measure: %

Importance

A lower percentage indicates better cost performance. For benchmarking purposes this metric is measured annually. For scorecards, dashboards and cockpits these a typically a rolling number of months. t:OM

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Hierarchy

ID	Name	Level	x
CO12	Distribution Costs	2	CO12
CO121	Order Management Cost	3	CO121
CO1211	Order Management Labor Cost	4	CO1211
CO1212	Order Management Automation Cost	4	CO1212
CO1213	Order Management PP&E Cost	4	CO1213
CO1214	Order Management GRC Cost	4	CO1214

Process(es)

ID	Name	Level	x
S401	Process Return Inquiry	3	S401
S402	Create Return Authorization	3	S402
S408	Settle Return	3	S408
D101	Process Inquiry	3	D101
D102	Create Order	3	D102
D103	Reserve Inventory	3	D103
D105	Invoice	3	D105
D201	Process Inquiry	3	D201
D202	Validate & Create Order	3	D202
D203	Route & Schedule Order	3	D203
D205	Invoice	3	D205
D301	Receive Request for Proposal	3	D301
D302	Develop & Present Proposal	3	D302
D303	Create Project Order	3	D303
D304	Schedule Project Resources	3	D304
D305	Schedule Delivery & Installation	3	D305
D306	Invoice	3	D306

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