Taking the order is easy. Keeping the promise is where it breaks | Keith Gorney, OMS Practice Director, Pivotree | Ep. 5

[00:00:00] Welcome to Data vs. Commerce, where we explore the messy middle between database and doorstep. I'm Matt Johnson. And I'm Floyd Blakey. Let's dig in. Hey guys, welcome back to Data vs. Commerce. We are joined by a special guest, our friend and colleague, Keith Gorney is here. He is our OMS Practice Director, all things order management with a really great deep background in both direct-to-consumer as well as B2B.

[00:00:28] So we're excited to dive into customer experience and how orders get processed today, what's lacking, and where we're heading in these different industries that we serve. Keith, welcome to the show. I'd love for you to start off by telling us a little bit about who you are and what you do. Keith Gorney, OMS Practice Director, Pivotree

[00:00:49] Sure. Thanks, Matt. I appreciate that. So I have been in the direct-to-consumer, B2B, all things order fulfillment space for 25 years. I started my career at Best Buy and oversaw their entire order management solution. About $10 billion of their annual revenue came through their order management platform.

[00:01:14] And so this was anything from direct-to-consumer, all B2B sales that they had. It was a very prolific and extended application. Carried that over into a number of consulting roles, spent some time with urban outfitters and free people and anthropology in their space as far as direct-to-consumer.

[00:01:36] And now everything is just focused on ensuring that our customers are set up for success, regardless of the industry that they're in and meeting the promise that they're setting with their customers for order fulfillment. Keith, I saw a crazy stat in the last couple of days. And I remember hearing about, like, millennials slowly becoming the largest cohort of B2B decision-makers, and I realized that was, like, 11 years ago.

[00:02:02] So now over 70% of B2B buyers are millennials and Gen Z, which makes me feel old and crusty. Boomers are basically all retired. Gen X, still a big force in the workplace, often in, you know, leadership roles. But if we're talking about the people who are researching the solutions, who are having those initial conversations, who are feeling the pain of basically any business problem,

[00:02:26] it's really often people who have grown up or later in their lives like me were able to buy things online and have that be a super seamless type of experience. So I think there's an expectation now that, you know, it should be as easy to buy from a manufacturer or distributor as it is to buy something from Amazon.

[00:02:50] So I want to unpack with you how true that is and if B2B can get to where B2C is in terms of making that kind of purchase process easy peasy, at least from the outside looking in. Yeah, and I think we're seeing a lot of that in this space.

[00:03:08] So what you're seeing is those expectations of the ability to navigate, find, buy, trust and get come to fruition in a accelerated manner and frustration when you can't. And so it's incumbent upon manufacturers to understand where their customers are approaching them, whatever channel that is, phone, web, device.

[00:03:37] It doesn't matter. Salesperson shoulder to shoulder on a device. It doesn't matter. The expectation is that whatever you're showing and indicating on a screen is the truth. And whenever you can't manifest that through the life cycle, it becomes a huge, huge issue. So not only consider the finding and the navigating, let's say trying to self-serve, but then also just adding the cart and availability and promise states.

[00:04:07] All of that coming to fruition through, you know, it's easy to take an order, right? But when it comes to the execution side, like that's where the friction really starts to manifest is that you gave me a promise, right? And I expect that promise to be met. And when you can't meet it, I'm going to find it somewhere else. And, you know, direct to consumer has been dealing with that since the institution of it.

[00:04:32] But now B2B has become more, more prolific and demanding from, from its customers to accommodate those promises. Yeah. And in B2B, I'm probably not necessarily going to go somewhere else because maybe I'm contracted to buy from this particular supplier, but I'm certainly going to go to a different channel. Uh, I'm going to call my rep or I'm going to email, right?

[00:04:59] Or I'm just going to abandon the digital commerce channel entirely because why, right? Like, because there's gaps and I need information. I need it now in B2B context, but this isn't something that we can wait on, right? There's a factory line. There's a piece of equipment that's down, right? So order management, I think is the unsung hero behind what makes really good B2B commerce experiences work.

[00:05:29] And, uh, I would, I don't know about you, Keith, but I feel like adoption really is the most important thing in terms of, you know, using these e-commerce websites. If, if a customer can't trust what they're seeing and they don't have updates and they have to turn to a phone. I mean, God forbid, like we millennials, we do not like picking up the phone and calling a rep. Don't make me do it. Exactly. Something's got to give, right?

[00:05:59] Yeah. And I think you kind of hit the nail on the head, right? Is that I'm going to navigate through around. I have a need. The reason to buy, the reason to purchase, the reason to spend money is to fulfill a need. And, uh, you know, like these buyers are held accountable to meeting those needs. It's, it's not like they're sitting around wondering what they should spend their money on. They're coming to you for exactly what they need and when they need it.

[00:06:28] Um, and so being able to not only manifest that through a direct conversation, but also mirror that in any channel that you're, you're executing with your customers has become more of the norm and the expectation. And, you know, think about the drain that it, that it does incur for an organization who can't get that right because, you know, they don't trust your website. So they're not going there. They, you fail once, you fail twice, forget it. They're just going to go down a single path.

[00:06:57] And usually those are your more expensive paths to go down. So don't manufacturers and distributors though, kind of already have enough platforms involved in e-commerce. I mean, you can't just connect the storefront to the ERP and hope for the best. Like why haven't we seen OMS enter that B2B commerce tech stack conversation as much as we have WMS and ERP and things like that? I think it's a matter of fit, right.

[00:07:26] Right. For, for an organization, especially, you know, I'll work with companies who have a multitude of banners underneath their brand and that, you know, manufacturing. And so each of those is connected to an ERP. But when you start thinking about having to modify or upgrade, right, you're doing it against all of those different ERPs. Your requirements have to be met and each and every one of those ERPs.

[00:07:55] And so I think from a fitment standpoint, it really comes down to not just necessarily the technology. Like, do I have it? It's do I have the right technology? And what we've seen is that ERPs, while they have all, every organization needs one, they've become so reliant upon it that it's more like working around it versus with it.

[00:08:20] And I think that's where an OMS comes in and it evangelizes the opportunity to do massive things like global inventory visibility. Right. And right now, what you see is you see channel conflict, phone, device, salespeople, manual orders. Right. They're all flowing in. And when you can't execute those necessarily real time, that demand starts compounding on each other and they're racing against that inventory.

[00:08:49] And so what an OMS will do is it'll capture all of your different channels of inventory or supply chain availability and expose that to all of your channels so that you have a real time version of the truth that you can produce for your customers. That's like that's like the one on one. Right. Just getting inventory availability correct is one on one.

[00:09:12] Then you start to get into the nuances of, hey, what's the fastest, best, easiest, cheapest right way to to get this to that customer? You see a lot of times where you are taking those those race condition orders and now you're having to make phone calls back and saying, I'm sorry, we actually don't have this inventory.

[00:09:32] You're going to have to wait. So those that ability to put that that data in front of your customer that can allow them to trust that, yes, they have this available right now is actually paramount to to, you know, creating that that trusted experience with your buyers. And one of the things I was thinking of Keith, as you're talking was that we often think about the buyer, right?

[00:09:58] In terms of the buyers experience. But what about the customer service team and their experience? And when you're locked into an ERP system, a legacy platform that has really a lot of limitations around the kind of like real time data and control around an order that they need. A lot of it requires them to go into these legacy systems, make changes, jump on an email, jump on a phone call. Right.

[00:10:27] There's a lot of back and forth. This isn't the way millennial and Gen Z customer service reps want to work. Right. So, and we're living in a world today where, you know, we have the ability to connect different systems that are best of breed at doing certain things into an ERP a lot easier than we ever did.

[00:10:48] Why not give the team the tools that they actually want to use that are going to help them serve their customers more, more, more efficiently. Right. And easier for them. I think that, you know, user experience at the sales level matters as well. Right. Yeah. And I think that's a great comment. Right. Is that, you know, the the experience doesn't end with clicking the submit button and then just hoping. Right. And praying.

[00:11:16] There's a lot of different nuances that go into the journey to get that order fulfilled, especially if you're doing, if you're manufacturing based off of that demand. And so you need to understand not only the workflow behind the scenes, but then for any time a customer calls in and says, hey, I need to change.

[00:11:36] I need to accelerate this. I need to pause on that. And you need to be able to give your your customer facing resources the ability to adjust on the fly. And the common use cases, you know what? Cancel. Let's recreate it. Right. Let's cancel the order and we'll just start from scratch.

[00:11:55] And that also has created a ton of friction because sometimes these are, you know, hundreds of thousands of dollar orders and starting from scratch is, you know, effectively unacceptable. And so your ability to pivot and look at an order, not just as a whole, but as the pieces and parts and be able to modify that to accommodate your customers requirements is massive.

[00:12:20] And the OMS and OMS allows you to look at each and every single piece of that part of that journey. See order, order line statuses, quantities fulfilled, quantities out for shipment. So you understand precisely what you can do or that customer when they're right in front of you. Let's take a step back for a second, though, because I've worked in, you know, manufacturing on the marketing side for a long time.

[00:12:44] I'm a weirdo. I think it's exciting. So I've worked with a lot of manufacturers and distributors where e-commerce makes a lot of sense. Right. You're buying components, you're buying widgets, you're buying them at scale. You want to be able to do that in kind of a self-serve way. I've also worked with manufacturers who sell like 20 million dollar industrial automation equipment. So probably we're not going online and buying a 20 million dollar robot with one click checkout.

[00:13:09] So how does this conversation extend to manufacturers who sell really complicated, very customized, high dollar figure stuff? Yeah, I think you start with the journey of building. Right. And you mentioned it. Right. I have to build this out. I have requirements that require pieces and parts, and I have to have an experience that allows me to understand dependencies. Right.

[00:13:35] If I'm buying widget A and widget B together, are they compatible? Right. So building out a full fledged solution really kind of gets back into the data. But even more important, if I have all those components that I'm offering, but they're not available, then I'm actually building out a, you know, a mechanism for failure.

[00:13:58] And, you know, there's all sorts of rules that an OMS can manage to say whether or not I can actually fulfill that. And, you know, one of the larger things that I think an OMS does that manufacturing benefits from is it not only understands what you have in stock, but it can also drive the request to replenish.

[00:14:20] So if you're out of stock and you're having all this demand come in, it can automatically generate those replenishment requests from wherever it needs to be and navigate it all to a single facility for the component build. So it can merge all of that information on a single order and say, where is all this stuff? Find it all, put it all to the actual assembly location and get it assembled for that customer.

[00:14:46] So I think that journey is very manual in an ERP world, where in an OMS you can set up those rules to say, this is the node that I want to build this in. Now go find the fastest, cheapest, easiest way to get all of this product into this so that we can manufacture it and then deliver it to a customer. You see this with even direct to consumer. I mean, people are buying home theater installation online.

[00:15:12] But like, you know, the speakers and the wires and the, you know, all the components and the television and everything else don't all sit just in a box. Right. Like they all have to get merged together in order to get onto a delivery truck and then come to your house for somebody to install it. So this is not a, you know, a new feature that, you know, the we're just uncovering. The OMS has been doing this since the inception of when it became popular in the early 2000s.

[00:15:39] Well, it re it just reminds me of, you know, a particular industry that is fairly legacy in the way that it operates, you know, very ERP heavily reliant. And that is like electronic components. And you think about all of these data centers.

[00:15:59] And we just did an episode about AI, right. And you think about all these data centers and all of these different installations, electrical installations that are going on and the chips and the wiring and the harnesses and the, you know, the conductors. And like, there's all these components that need to be delivered to a customer. Right. And they're all handled individually.

[00:16:20] Well, imagine the experience that you can create for the customer if you're able to orchestrate all of these different components and deliver them and to be able to do it all online without this crazy custom sales process, which requires so much quote manual quoting.

[00:16:40] Right. Right. Like digging into different systems and pulling back the numbers and delivering the quote in the lead time again, like electrical engineers, you know, you know, these people that are on these projects today, they, they require a different online experience. But it's crazy that, you know, in their day to day, they're using state of the art technology.

[00:17:03] And yet when it comes to the actual digital supply chain that they're trying to source their products through, it's completely busted. I think two things that I've seen in this advent is that you see branded manufacturers. All right. So people who are selling direct to consumer and also to wholesale, they've actually, if they're, they're direct to consumer channel as an OMS against it, but their wholesale is ERP driven.

[00:17:32] And we're seeing this, this massive migration of saying, well, guess what? Like it's the same products that I'm offering direct to consumer and through wholesale. So if I can merge all of that into one platform, now I don't have to reserve one bucket of inventory for one channel and one of the other. I got this holistic pot of inventory and anybody can come and get it.

[00:17:59] Right. So we're seeing that a lot with, you know, the direct, those, those branded manufacturers have direct, a direct to consumer channel, but are also servicing the wholesale model. I think the other thing that's very interesting is, you know, we talk about how complex the B2B orders can be. And in a typical D2C it's, I want it and I want it as fast as I can get it. So, I'm going to be able to do a lot of, you know, in-store pickup, right? Curbside, you know, DoorDash, however, however fast I can get it.

[00:18:29] Whereas in the, in the, the B2B model speed is, is great, but it's expectation that's even more required. Right. So, and my orders may not necessarily just be a, Hey, I want it today. It's I'm ordering for a job that's going to be executed three months from now. And think about that. Are you going to reserve, let's say they're ordering a thousand pieces. Are you going to hold on to a thousand pieces of inventory for three months?

[00:18:56] Or is your OMS to capture all that demand and be able to say, okay, I know that I have this demand coming in three months, but now I can take orders against that 3000. That's just sitting there, that thousand that's just sitting there and ensure that I have replenishment coming into my supply chain in time to meet that, that need three months down the road.

[00:19:17] So I think that's a huge thing that we're seeing is that, you know, in the advent of, of, you know, just leveraging ERP, but now adding in this new technology of an OMS, you're able to, I don't want to say Rob Peter to pay Paul, but you're able to optimize your inventory through because you're, you're actually, you understand what you have, when and where, and are able to optimize how your order demand is fulfilled.

[00:19:43] Yeah. I do look forward to the future that I believe you're building Keith, which is where you can door dash a $20 million robot 2030, 2035. If we're thinking about, you know, a manufacturer distributor, yeah, $20 million will get me like a Roomba 2030.

[00:20:02] It's true. If we're thinking about a manufacturer distributor that maybe is, you know, leaning entirely on ERP right now to help run their e-commerce, they're kind of feeling the pain of that, that legacy tech stack. That's really the bottleneck is order management. Like what do they do first? How do they dig themselves out of that hole?

[00:20:21] And I think that's one of the main misconceptions about OMS is it's like, it's an OMS or it's nothing, right? ERP basically is, it's an ERP or it's nothing. Cause you're, you're, you're utilizing the entire support structure of that ERP where OMS can actually be as, is component. You can build it as components.

[00:20:43] And when I think of the largest issue that's impacting manufacturing today, it's inventory availability. That's the first step. And OMS is typically just have a native feature that you can build as a service that says every time, every inventory movement, receipt, transaction, QA hold, all of those different things that impact inventory availability can be fed into a, an OMS component.

[00:21:13] You can just buy that OMS component, set that up as your first step and expose that as a service of just availability. Okay. That's just, that's the first step. I will invite others on the other side of it is the demand side. So not only like, and so now once you get your feet wet with, okay, yes, now I trust what inventory I have. Now you begin to at least potentially even just feed the quantity of demand, not necessarily the order per se, but you can just feed it demand and say, you started today with a thousand.

[00:21:43] The ERP just took in 10 different orders and now it's down to 500. So this service should only be able to promise 500 to every single one of your channels. So you can step your way into this without this huge investment cost.

[00:21:57] And this huge change management of, Hey, we got to pull all this stuff out of ERP and it can only exist here. You can migrate your way through this. And even in today's market, it's not, you know, everybody thinks migrations are years. These are not year long issues. These are months. Like we've done OMS implementations in three months.

[00:22:19] And it's just a matter of carving out the requirements of exactly what you want to meet. And we can, again, start small. It's a specific channel. It's only phones. It's a, you know, it's only these types of customers. There's so many different ways you can slice and dice this capability to begin to, to appreciate the foundation of it as you build and grow on top of it. It's not a just, you know, it's not a slam dunk, you know, big bang, huge change management curve.

[00:22:47] It can absolutely be used to optimize and, and migrate over time as you become, as you become more comfortable with it. I love that Keith. It's digital transformation is, I've said this before. It's not about trying to do everything. That's about doing the next right thing in the right way. And I love that about OMS, the composability of it and, you know, the ability to scale and not disrupt the entire sales work.

[00:23:15] So really good stuff. We really appreciate you being here, Keith. This is so awesome and informative. We're looking forward to getting you back on here and they will bring a OMS customer. I think that'd be fun. Yeah, that'd be great. And, you know, just, just to talk about their journey. I mean, I think all of that's relevant, especially as you, as you look at the advent and, you know, I said it before is like, you know, this isn't a, this is not like a, if it's kind of a more of a when, right?

[00:23:45] The industry and everybody is looking and we're seeing so much interest and, and actual intent to onboard this, that it's, it's becoming a norm back. Like we were 20 years ago, a direct to consumer. It was, you have to have an OMS. And I think it's just, it's taken its time because there wasn't this, there wasn't this expectation, right?

[00:24:12] It was like, okay, yeah, I'll get it to you when I can get it to you. But in today's world, it's more, it's becoming more and more of a requirement versus, you know, a nice to have. So I think we're, as we see this momentum, you know, please do reach out and talk with us. We love this. I love the gear. I love the space. I love the process. So we're here for anybody who needs the help. Thanks so much, Keith. All right. Appreciate the time, guys. Thanks, Keith. Talk to you soon. All right. Take care.

[00:24:42] Bye. Thanks for tuning in to this episode of Data vs. Commerce. New episodes drop weekly. So if you're responsible for any part of how products get from a database to a doorstep, subscribe now on Apple, Spotify, or wherever you listen.