In manufacturing today, executives face a delicate balancing act: meeting unique customer requirements while keeping costs, capacity, and lead times under control. Every decision around production planning has ripple effects across inventory, cash flow, and customer satisfaction.

One of the more powerful levers available in IFS Applications is Dynamic Order Processing (DOP). Used correctly, it can streamline operations and align production tightly to demand. Used in the wrong context, however, it can create unnecessary complexity and slow an otherwise efficient operation.

So the question isn’t whether DOP is valuable, it’s where it adds the most value to the business, and where alternative approaches may be more effective.

What Is Dynamic Order Processing?

Dynamic Order Processing (DOP), often called make to order (MTO), is a pull-based supply chain strategy. Unlike make to stock (MTS), where products are built in advance and placed into inventory, DOP only initiates production once a customer order is confirmed.

In practice, IFS supports several variants of pull-type manufacturing, from MTO and Assemble to Order (ATO) to Configure to Order (CTO) and Engineer to Order (ETO). These models let manufacturers create multi-level structures for planning, purchasing, and execution, all while keeping cost, time, and order pegging under tight control.

The real question is: when does this model drive business impact?

Where DOP Creates Value

1. Complex, Customized Products

For organizations offering highly configurable products, think aircraft systems, IT servers, or industrial machinery. DOP ensures that production directly reflects customer specifications. Each order becomes unique, minimizing errors and ensuring customers get exactly what they’ve paid for.

Business impact: Higher customer satisfaction and reduced rework.

2. High-Value, Low-Volume Production

When inventory ties up millions in working capital, building to forecast is often too costly. By linking production only to demand, DOP prevents cash from being locked in stock that may or may not move.

Business impact: Optimized cash flow and reduced holding costs.

3. Project-Based Manufacturing

For capital projects (like power plants or infrastructure builds) DOP allows manufacturers to peg shop orders, purchase orders, and materials directly to project deliverables.

Business impact: Clearer project cost tracking and stronger alignment between operations and customer commitments.

4. Delivery Promises with Confidence

DOP validates both capacity and material availability at the point of order booking. That means sales teams can promise delivery dates with more certainty.

Business impact: Improved customer trust and reduced risk of over-promising.

5. Cost and Profitability Visibility

Order unique costing provides executives with line of sight into margins at the order level, critical when operating in a world of thin margins and demanding stakeholders.

Business impact: Fact-based decision-making on pricing, discounts, and contract negotiations.

Where DOP May Add More Complexity Than Value

Not every manufacturing environment benefits from DOP. In some cases, traditional make to stock or hybrid models deliver higher efficiency.

1. Standardized, High-Volume Products

For consumer goods and other fast-moving products, demand can usually be forecast accurately. In these cases, MTS simplifies operations and enables economies of scale.

2. Predictable, Stable Demand

If demand patterns are reliable, the overhead of DOP structures can outweigh the benefits. MRP and inventory planning will often be more straightforward and cost effective.

3. By-Products and Disassembly

DOP is not designed for processes with by products or disassembly flows. Alternative planning models are required here.

4. Constantly Changing Requirements

Yes, DOP can handle change propagation. But if changes occur too frequently, the administrative load can outweigh the value.

5. Fast-Moving, Speed First Supply Chains

Where speed is more critical than customization (for example, FMCG or electronics accessories), DOP can introduce delays compared to lean push models.

Best Practices for Executives Considering DOP

  • Use alarms with purpose. Don’t overwhelm teams with alerts, configure them to highlight the mismatches that truly matter.
  • Be selective with propagation. Push changes only when needed to avoid “noise” in operations.
  • Align with projects. Where project delivery is central, ensure pegged orders and project IDs are linked properly from the start.
  • Balance supply flexibility. Decide whether pegged supply orders should be released one-by-one or in bulk, depending on operational rhythm.

Final Word

Dynamic Order Processing can be transformative in the right setting. For manufacturers with complex, high value, and demand driven production, it offers a path to improved visibility, profitability, and customer alignment. But for organizations with stable, predictable, or high volume output, traditional models may be the smarter choice.

Ultimately, the challenge isn’t just implementing DOP, it’s knowing when to deploy it and where it will deliver the greatest business impact.

At JumpModel, we work with industrial businesses to navigate exactly these trade-offs—helping leaders unlock the full potential of IFS Applications. Whether it’s deploying DOP effectively or choosing the right alternative, we guide clients to decisions that drive efficiency, resilience, and bottom-line growth.