Automated Order Processing:
Steps, Benefits, Technology

What is Automated Order Processing?

Automated Order Processing is an intelligent technology ecosystem that orchestrates the entire order lifecycle - from initial capture through fulfillment and delivery - with minimal human intervention. In 2026, modern order processing systems integrate artificial intelligence, robotic process automation (RPA), and advanced analytics to handle order entry, validation, inventory synchronization, billing, shipping coordination, and customer communication. Unlike traditional manual processes, automated order processing software operates 24/7, processes orders in real-time, and continuously learns from patterns to optimize workflows. This technology transforms order processing from a cost center into a strategic capability that drives customer satisfaction, operational efficiency, and competitive differentiation.

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Key Components of Automated Order Processing

Order Entry and Capture

Modern order processing platforms employ intelligent capture technologies that automatically ingest orders from diverse channels - e-commerce marketplaces, email, EDI (Electronic Data Interchange), API integrations, POS systems, and even paper documents via OCR. Advanced order processing software uses AI-powered data extraction to parse unstructured information, validate formats, and normalize data across different sources. This eliminates manual data entry entirely, reducing capture time from hours to seconds while achieving 99%+ accuracy rates. Leading order management software solutions can process thousands of orders per hour across multiple channels simultaneously, ensuring no order falls through the cracks.

Order Validation

Intelligent order processing systems implement multi-layer validation that goes far beyond basic checks. Modern order processing software validates customer information against CRM databases, verifies payment methods through integrated payment gateways, checks credit limits in real-time, confirms product availability against live inventory feeds, and enforces business rules such as minimum order quantities, shipping restrictions, and pricing agreements. Advanced order processing platforms use machine learning to identify patterns in fraudulent orders, flag anomalies, and automatically route exceptions to human reviewers. This comprehensive validation prevents costly errors before they impact fulfillment, reducing chargebacks, returns, and customer service escalations.

Inventory Management

Seamless integration between order processing systems and inventory management platforms creates a unified view of stock levels across warehouses, distribution centers, and retail locations. Automated order processing platforms update inventory in real-time as orders are captured, reserved, and fulfilled, preventing overselling and stockouts. Advanced order management software can intelligently allocate inventory based on proximity to customers, shipping costs, and fulfillment capacity. Some systems even leverage predictive analytics to forecast demand and suggest optimal stock levels. This real-time synchronization ensures accurate order promises, reduces fulfillment delays, and maximizes inventory turnover rates.

Billing and Invoicing

Sophisticated order processing software automatically generates invoices, credit memos, and billing documents with precision and compliance. Modern systems calculate complex pricing structures including volume discounts, promotional codes, tiered pricing, and contract-specific rates. They handle multi-jurisdictional tax calculations, apply shipping costs based on real-time carrier rates, and format invoices according to customer-specific requirements. Advanced order processing platforms integrate with accounting systems to post transactions automatically, reconcile payments, and manage accounts receivable. Invoices are delivered via email, EDI, or customer portals, with automated follow-ups for overdue payments. This end-to-end automation eliminates billing errors, accelerates cash flow, and reduces accounts receivable days outstanding.

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Shipping and Fulfillment

Intelligent order processing platforms optimize shipping and fulfillment through carrier integration, rate shopping, and automated label generation. Modern order management software compares shipping rates across multiple carriers in real-time, selects the most cost-effective option that meets delivery commitments, and automatically generates shipping labels and customs documentation. Advanced systems can consolidate orders, optimize packing configurations, and route orders to the nearest fulfillment center. Some order processing platforms integrate with warehouse management systems to coordinate picking, packing, and staging workflows. Automated carrier scheduling ensures timely pickups, while real-time tracking updates keep customers informed throughout the delivery journey. This optimization reduces shipping costs by 15-30% while improving on-time delivery performance.

Order Tracking and Notifications

Proactive communication is a hallmark of modern order processing systems. Automated platforms send personalized notifications at every stage - order confirmation, payment processing, inventory allocation, shipping preparation, carrier pickup, in-transit updates, and delivery confirmation. Customers can track orders through branded portals, receive SMS updates, or check status via mobile apps. Advanced order processing software provides estimated delivery windows, allows customers to modify delivery preferences, and sends proactive alerts about potential delays. This transparency reduces customer service inquiries by 40-60%, builds trust, and creates opportunities for cross-selling and upselling. In 2026, leading order management software solutions use AI to predict and communicate delivery times with high accuracy, setting realistic expectations and exceeding them.

Benefits of Automated Order Processing

Organizations implementing automated order processing systems report transformative improvements across multiple dimensions. Processing speed increases dramatically - orders that previously took hours or days to process now complete in minutes. This acceleration enables businesses to handle 3-5x more order volume without proportional increases in staff, creating significant scalability advantages. Error reduction is equally impressive: automated order processing software eliminates the 5-10% error rate typical of manual processes, reducing incorrect quantities, wrong shipping addresses, billing mistakes, and inventory discrepancies. These accuracy gains translate directly into cost savings - fewer returns, reduced customer service workload, lower chargeback rates, and improved customer retention. The financial impact is measurable: businesses typically see 30-50% reduction in order processing costs and 20-40% improvement in order-to-cash cycle times.

Beyond cost reduction, automated order processing platforms deliver strategic advantages that compound over time. Labor cost savings are immediate - staff previously dedicated to data entry and manual validation can be redeployed to customer service, sales, or strategic initiatives. However, the greater value lies in operational excellence: real-time visibility into order status, inventory levels, and fulfillment performance enables data-driven decision-making. Modern order processing software provides analytics dashboards that reveal bottlenecks, identify trends, and suggest optimizations. Customer experience improvements are measurable - faster fulfillment, accurate order promises, proactive communication, and seamless returns processing all contribute to higher Net Promoter Scores (NPS) and customer lifetime value. Additionally, automated order management software ensures compliance with regulatory requirements, maintains audit trails, and supports scalability as businesses grow into new markets or channels.

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Scalability is perhaps the most compelling advantage of automated order processing platforms. Cloud-based order processing systems can handle order volume spikes during peak seasons, flash sales, or promotional events without infrastructure investments. As businesses expand into new geographic markets, product lines, or sales channels, the order processing software adapts through configuration rather than custom development. This elasticity enables businesses to pursue growth opportunities without the operational constraints that traditionally limit expansion. Inventory optimization is another critical benefit: real-time synchronization between order processing and inventory systems ensures accurate stock visibility, enabling businesses to maintain lean inventory levels while avoiding stockouts. Advanced order management software can even suggest optimal reorder points and quantities based on historical patterns and demand forecasts, reducing carrying costs while improving service levels.

Applications of Automated Order Processing

• E-commerce: In 2026's hyper-competitive online retail landscape, automated order processing systems are essential for managing high-volume, multi-channel order flows. E-commerce businesses leverage order processing software to handle orders from marketplaces (Amazon, eBay, Shopify), direct-to-consumer channels, and B2B portals simultaneously. Modern order management software integrates with shopping carts, payment processors, and fulfillment networks to process orders within seconds of placement. This speed and accuracy directly impact conversion rates, customer retention, and marketplace seller ratings. Leading e-commerce operations process thousands of orders daily with minimal manual intervention, enabling them to compete effectively while maintaining profitability.
• Manufacturing: Manufacturing organizations use automated order processing platforms to orchestrate complex supply chains, managing orders for raw materials, components, sub-assemblies, and finished goods. Advanced order processing systems integrate with production planning, MRP systems, and supplier networks to ensure materials arrive just-in-time for production schedules. This synchronization reduces inventory carrying costs, prevents production delays, and enables make-to-order manufacturing models. Order management software in manufacturing environments handles customer orders, internal work orders, and supplier purchase orders through a unified platform, providing end-to-end visibility from customer demand through material procurement to final delivery.

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• Wholesale and Distribution: Wholesale and distribution businesses process complex orders with multiple line items, varying quantities, and diverse customer-specific requirements. Automated order processing software handles bulk orders, manages complex pricing structures (volume discounts, contract pricing, promotional rates), and coordinates multi-stop deliveries. Order processing platforms integrate with warehouse management systems to optimize picking routes, consolidate shipments, and manage cross-docking operations. Advanced order management software can automatically allocate inventory across distribution centers based on customer proximity, shipping costs, and stock availability. This optimization reduces shipping costs, improves delivery times, and enables distributors to compete effectively in an era where customers expect Amazon-like fulfillment speed.
• Retail: Modern retail operations require seamless integration between online and in-store channels, and automated order processing systems make this possible. Retailers use order processing platforms to enable buy-online-pickup-in-store (BOPIS), ship-from-store, and endless aisle capabilities. Order management software provides real-time inventory visibility across all locations, enabling store associates to check availability, place orders, and fulfill customer requests from any location. This omnichannel approach increases sales, reduces markdowns, and improves customer satisfaction. Automated order processing also handles returns and exchanges across channels, creating a frictionless experience that builds customer loyalty.
• Healthcare: Healthcare organizations rely on automated order processing systems to manage critical supply chains with precision and compliance. Order processing software in healthcare handles orders for medical supplies, pharmaceuticals, equipment, and services while maintaining regulatory compliance (HIPAA, FDA requirements). Advanced order management software tracks lot numbers, expiration dates, and regulatory documentation, ensuring patient safety and audit readiness. Healthcare order processing platforms integrate with electronic health records (EHR) systems, pharmacy systems, and supply chain networks to automate procurement, reduce stockouts of critical supplies, and optimize inventory investment. In 2026, healthcare organizations increasingly use automated order processing to manage value-based care contracts, track outcomes, and ensure cost-effective care delivery.

The applications above demonstrate that automated order processing has evolved from a nice-to-have efficiency tool to a strategic necessity across industries. In 2026, businesses that rely on manual order processing face significant competitive disadvantages: slower fulfillment, higher error rates, increased costs, and limited scalability. Conversely, organizations with mature automated order processing systems achieve operational excellence that directly impacts customer satisfaction, profitability, and market position. The technology has matured to the point where implementation is faster, integration is more seamless, and ROI is more predictable than ever before.

Whether in e-commerce, manufacturing, wholesale, retail, healthcare, or any industry that processes orders, automated order processing platforms represent a critical capability for businesses that want to compete effectively, scale efficiently, and deliver exceptional customer experiences. The question for most organizations is no longer whether to automate, but how quickly they can implement and optimize their order processing software to capture these advantages.

When Automated Order Processing Shines: Perfect Scenarios for Efficiency Gains

While automated order processing systems deliver value across diverse business contexts, certain scenarios amplify their impact. Understanding these high-value use cases helps organizations prioritize implementation and set realistic expectations for ROI. In 2026, businesses that match their order processing challenges with appropriate automation strategies achieve the fastest time-to-value and highest return on investment.

High Volume Orders and Automated Order Processing

Businesses processing hundreds or thousands of orders daily experience the most dramatic benefits from automated order processing systems. High-volume operations face exponential scaling challenges with manual processes - each additional order requires proportional labor, increasing costs linearly while error rates compound. Order processing software handles volume spikes during peak seasons, flash sales, or promotional events without adding staff or overtime costs. The automation handles the repetitive, rule-based work - data entry, validation, routing, inventory allocation - while your team focuses on exceptions, customer service, and strategic initiatives. This division of labor creates a sustainable competitive advantage: your order processing platform scales effortlessly while your human capital focuses on value creation.

Automated Order Processing and Standardized Products

Organizations with well-defined product catalogs, consistent pricing structures, and predictable order patterns achieve exceptional results with automated order processing platforms. Standardized products enable order processing software to apply business rules consistently, validate orders against predefined criteria, and route orders through established workflows. This predictability allows the order management software to operate with minimal exceptions, achieving near-perfect accuracy and maximum throughput. Businesses with complex product configurations, extensive customization, or one-off orders may require more sophisticated order processing systems with AI-powered decision engines, but standardized product businesses can achieve rapid ROI with straightforward automation. The key is matching the complexity of your order processing software to the complexity of your order patterns.

Automated Order Processing Integration with Existing Systems

The transformative power of automated order processing multiplies when integrated with your existing technology ecosystem. Modern order processing platforms offer pre-built connectors for popular ERP systems, accounting software, inventory management systems, CRM platforms, e-commerce platforms, and shipping carriers. This integration creates a unified data flow: orders flow automatically from sales channels into the order processing system, which validates against inventory, updates accounting records, creates fulfillment tasks, and syncs customer data to CRM. The result is a single source of truth that eliminates data silos, reduces manual reconciliation, and enables real-time decision-making. Organizations with mature integration strategies achieve the highest ROI from order processing software because automation compounds across systems, creating efficiency gains that far exceed the sum of individual improvements.

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Reduced Order Complexity with Automated Order Processing

Simple, straightforward orders are ideal candidates for automated order processing systems. When orders follow predictable patterns - standard products, standard pricing, standard shipping - order processing software can handle them end-to-end without human intervention. This automation creates a fast lane for routine orders, processing them in minutes rather than hours or days. However, modern order processing platforms are increasingly sophisticated, using AI and machine learning to handle moderate complexity: applying customer-specific pricing, managing promotions, handling split shipments, and coordinating multi-item orders. The key is understanding your order complexity profile: businesses with primarily simple orders achieve immediate benefits, while those with complex orders should evaluate advanced order management software with AI capabilities that can learn and adapt to nuanced requirements.

Automated Order Processing in Globally Distributed Operations

Global businesses face unique challenges: orders arrive from multiple time zones, fulfillment occurs across distributed warehouses, and customer expectations demand 24/7 responsiveness. Automated order processing systems excel in this environment by operating continuously, processing orders regardless of local business hours. Cloud-based order processing platforms can route orders to the nearest fulfillment center, apply region-specific pricing and tax rules, and coordinate multi-warehouse fulfillment automatically. This global capability enables businesses to compete internationally without maintaining round-the-clock staff in every market. Additionally, automated order management software can handle currency conversions, international shipping documentation, customs compliance, and multi-language customer communications, removing barriers to global expansion that previously required significant operational overhead.

These scenarios illustrate that automated order processing systems deliver maximum value when aligned with your business characteristics: high volume, standardized processes, integrated systems, manageable complexity, and global operations. However, even businesses that don't match these profiles perfectly can achieve meaningful benefits. The key is selecting order processing software that matches your current needs while providing a path to expand capabilities as your business evolves. Organizations that streamline the sales order cycle through thoughtful automation implementation typically see ROI within 6-12 months, with benefits compounding as the system learns and optimizes over time. The question isn't whether your business fits the ideal profile - it's how quickly you can start capturing the efficiency gains that automated order processing platforms make possible.

Automated Order Processing 101: Key Terms Defined

What Is Order Capture?

Order Capture is the initial stage of the order processing workflow where order information is collected from various sources - e-commerce platforms, marketplaces, email, EDI (Electronic Data Interchange), API integrations, POS systems, phone orders, or even paper documents. In modern automated order processing systems, intelligent capture technologies use OCR (Optical Character Recognition), AI-powered data extraction, and natural language processing to parse unstructured information and convert it into structured order data. Advanced order processing software can capture orders from multiple channels simultaneously, normalize data formats, and validate information in real-time. This automated capture eliminates manual data entry, reduces capture time from hours to seconds, and achieves accuracy rates exceeding 99%, making it a foundational capability of any modern order processing platform.

What Is Order Validation?

Order Validation is a critical quality control step in automated order processing where the system verifies order accuracy, completeness, and compliance before proceeding to fulfillment. Modern order processing software performs multi-dimensional validation: customer data is checked against CRM systems for accuracy and account status, payment methods are verified through integrated payment gateways, credit limits are validated in real-time, product availability is confirmed against live inventory feeds, pricing is validated against contracts and promotions, and business rules are enforced (minimum order quantities, shipping restrictions, product compatibility). Advanced order management software uses machine learning to identify suspicious patterns that might indicate fraud or errors. Automated validation catches issues before they impact fulfillment, reducing returns, chargebacks, and customer service escalations while maintaining data integrity throughout the order lifecycle.

What Is the Role of Inventory Management?

Inventory Management in automated order processing ensures that stock levels are accurately tracked, allocated, and updated in real-time as orders flow through the system. Modern order processing platforms integrate seamlessly with inventory management systems to create a unified view of available stock across warehouses, distribution centers, and retail locations. When an order is captured, the order processing software checks inventory availability, reserves stock, and updates inventory levels immediately. This real-time synchronization prevents overselling, enables accurate order promises, and supports advanced fulfillment strategies like ship-from-store or drop-shipping. Advanced order management software can intelligently allocate inventory based on customer proximity, shipping costs, and fulfillment capacity, optimizing both customer experience and operational efficiency. This integration is essential for maintaining inventory accuracy, reducing carrying costs, and ensuring customer satisfaction.

How Important Is Shipping Notification?

Shipping Notifications are automated communications sent to customers when their orders are shipped, typically including tracking numbers, carrier information, estimated delivery dates, and links to track packages in real-time. In 2026's customer experience landscape, shipping notifications are essential - customers expect proactive communication and real-time visibility into order status. Modern order processing software automatically generates and sends these notifications via email, SMS, or push notifications, often with branded templates that reinforce your brand identity. Advanced order management software can send multiple notifications: shipping confirmation, in-transit updates, out-for-delivery alerts, and delivery confirmation. This proactive communication reduces customer service inquiries by 40-60%, builds trust through transparency, and creates opportunities for post-purchase engagement. Some order processing platforms even use AI to predict and communicate delivery times with high accuracy, setting realistic expectations and exceeding them to improve customer satisfaction scores.

How to Achieve ERP Integration

ERP Integration connects automated order processing systems with Enterprise Resource Planning platforms, creating a seamless data flow between order management, financial systems, inventory management, production planning, and customer service. Modern order processing software offers pre-built connectors for popular ERP systems (SAP, Oracle, Microsoft Dynamics, NetSuite, etc.), enabling bidirectional data synchronization. When orders are processed, the order management software automatically updates ERP systems with order details, inventory changes, financial transactions, and customer information. This integration eliminates manual data entry, ensures data consistency across systems, and provides a unified view of operations. Advanced order processing platforms can even trigger ERP workflows - for example, automatically creating purchase orders when inventory falls below thresholds or generating production orders for make-to-order items. This deep integration is essential for organizations that need order processing to be part of a larger business process automation strategy, enabling end-to-end visibility and control.

What Is the Role of Customer Relationship Management (CRM)?

CRM integration with automated order processing creates a comprehensive customer view that enhances sales, marketing, and customer service capabilities. When order processing software integrates with CRM systems, every order automatically updates customer records with purchase history, product preferences, order frequency, average order value, and lifetime value metrics. This data enables sales teams to identify upsell and cross-sell opportunities, marketing teams to segment customers and personalize campaigns, and customer service teams to provide contextual support based on complete order history. Advanced order management software can even trigger CRM workflows - for example, automatically creating support tickets for orders with exceptions or alerting account managers when key customers place orders. This integration transforms order processing from a transactional function into a strategic capability that drives customer relationship management, enabling businesses to deliver personalized experiences that increase customer lifetime value and retention rates.

What Is API (Application Programming Interface) in Automated Order Processing?

APIs (Application Programming Interfaces) are the technical foundation that enables automated order processing systems to integrate with other software applications. Modern order processing platforms expose RESTful APIs that allow e-commerce platforms, ERP systems, inventory management systems, shipping carriers, payment processors, and other applications to send and receive order data programmatically. This API-first architecture enables real-time integration without manual intervention - orders flow automatically from sales channels into the order processing system, which then communicates with fulfillment, accounting, and customer service systems. APIs also enable custom integrations, allowing businesses to connect order processing software with proprietary systems or specialized applications. In 2026, leading order management software solutions provide comprehensive API documentation, developer tools, and webhook capabilities that enable businesses to build custom workflows and integrations that match their unique operational requirements. This API ecosystem is essential for creating the seamless, automated order processing workflows that deliver maximum efficiency and value.

What is Real-Time Processing?

Real-Time Processing in automated order processing means that orders are handled immediately upon receipt, with no batching or queuing delays. Modern order processing software processes orders in real-time: as soon as an order is captured, the system validates it, checks inventory, allocates stock, updates accounting records, generates invoices, creates fulfillment tasks, and sends confirmations - all within seconds.

This immediacy enables businesses to provide instant order confirmations, accurate delivery promises, and real-time inventory visibility. Real-time processing is essential for competitive advantage in 2026, where customers expect immediate responses and businesses need to react quickly to demand signals. Advanced order management software uses event-driven architectures and cloud computing to achieve sub-second processing times even during peak volumes, ensuring that order processing speed never becomes a bottleneck to business growth.

What is an Order Management System (OMS)?

An Order Management System (OMS) is a comprehensive software platform that orchestrates the entire order lifecycle from initial capture through final delivery and returns. Modern OMS solutions serve as the central nervous system for order processing, integrating with sales channels, inventory systems, fulfillment networks, shipping carriers, and customer service platforms. Advanced order management systems provide real-time visibility into order status, inventory levels, and fulfillment performance across all channels and locations. They automate order routing, inventory allocation, shipping optimization, and exception handling while maintaining a complete audit trail. In 2026, leading OMS platforms leverage AI and machine learning to optimize fulfillment decisions, predict demand, and continuously improve performance. The distinction between OMS and order processing software is often semantic - modern order processing platforms are essentially OMS solutions that have evolved to handle the complexity of omnichannel commerce, global operations, and advanced fulfillment strategies.

Why Is Order Tracking Important?

Order Tracking has evolved from a nice-to-have feature to a customer expectation in 2026. Modern customers demand transparency and control - they want to know exactly where their orders are, when they'll arrive, and have the ability to modify delivery preferences. Automated order processing systems provide comprehensive tracking capabilities: customers can view order status through branded portals, receive real-time updates via email or SMS, and track packages through integrated carrier tracking. Advanced order management software goes beyond basic tracking, providing estimated delivery windows, delivery preferences management, and proactive delay notifications. This visibility reduces customer anxiety, decreases support inquiries, and builds trust. Studies show that businesses with transparent order tracking experience higher customer satisfaction scores, lower return rates, and increased repeat purchase rates. In competitive markets, order tracking has become a differentiator that directly impacts customer loyalty and lifetime value.

Mastering these fundamental concepts provides the foundation for evaluating, implementing, and optimizing automated order processing systems. As you explore order processing software options, understanding these terms enables you to ask informed questions, compare solutions effectively, and design workflows that maximize automation benefits. The order processing landscape continues to evolve rapidly - AI capabilities, integration options, and feature sets expand constantly. However, these core concepts remain constant, providing a stable framework for making strategic decisions about order processing automation that will serve your business well into the future.

Final Thoughts: Embrace Automation and Watch Your Orders Flow

As we move through 2026, automated order processing has transitioned from an operational efficiency tool to a strategic competitive advantage. The organizations that have embraced order processing automation are achieving measurable improvements that compound over time. Here's what leading businesses are experiencing:

• Operational Excellence: Automated order processing systems handle routine work flawlessly, enabling your team to focus on strategic initiatives, customer relationships, and business growth rather than repetitive data entry and manual validation.
• Accuracy and Reliability: Modern order processing software eliminates the 5-10% error rate typical of manual processes, ensuring orders are processed correctly every time. This accuracy reduces returns, chargebacks, and customer service escalations while building trust with customers.
• Speed and Responsiveness: Automated order processing platforms reduce order cycle times by 70-90%, enabling same-day or next-day fulfillment that meets modern customer expectations and drives competitive differentiation.
• Cost Optimization: Organizations typically achieve 30-50% reduction in order processing costs through labor savings, error reduction, and operational efficiency gains. These savings improve profitability and free capital for growth investments.
• Data-Driven Decision Making: Real-time visibility into order patterns, inventory levels, and fulfillment performance enables data-driven optimization. Advanced order management software provides analytics that reveal bottlenecks, identify trends, and suggest improvements.
• Customer Experience Excellence: Faster fulfillment, accurate order promises, proactive communication, and seamless returns processing create experiences that drive customer satisfaction, loyalty, and lifetime value. In competitive markets, this experience advantage directly impacts revenue growth.

The evidence is clear: automated order processing systems deliver transformative benefits that directly impact profitability, scalability, and competitive position. In 2026, businesses that haven't automated order processing face increasing pressure from competitors who have, while those with mature automation strategies are capturing market share and expanding profit margins. The technology has matured to the point where implementation is faster, integration is more seamless, and ROI is more predictable than ever before. The question isn't whether automated order processing will become essential - it's how quickly you can implement and optimize your order processing software to start capturing these advantages. Organizations that act decisively to automate their order processing workflows position themselves for sustainable growth, operational excellence, and customer experience leadership in an increasingly competitive marketplace.