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Business Processes 9

Figure 1-5: A production process

FULFILLMENT—SELL
Fulfi llment (Figure 1-6) is concerned with effi ciently processing customer
orders. It is triggered by a customer purchase order that is received by the
sales department. Sales then validates the order and creates a sales order.
The sales order communicates data related to the order to other parts of the
organization, and it tracks the progress of the order. The warehouse prepares
and sends the shipment to the customer. Once accounting is notifi ed of the
shipment, it creates an invoice and sends it to the customer. The customer then
makes a payment, which accounting records.
As this scenario illustrates, fulfi llment triggers processes in IWM where
the materials are stored. Of course, in many cases the ordered materials are
not available in the warehouse. In such cases fulfi llment will trigger external
procurement and/or production.

Figure 1-6: A fulfi llment process

MATERIAL PLANNING—PLAN
The term material encompasses all the products, components, parts, and so on
that an organization uses. Businesses use and produce many types of materi-
als. For example, material planning in a bicycle manufacturer would include:
(a) fi nished goods, such as bicycles, that are sold to customers; (b) semifi nished
goods, such as wheel assemblies, that are used to make the fi nished goods; and

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