March/April 2003

As e.logistics Magazine completes its third full year of publication, editor Peter Rowlands marks the occasion by reflecting on a question that is constantly raised by readers

According to the New Oxford English Dictionary, the prime meaning of "fulfilment" is "satisfaction or happiness as a result of fully developing one's abilities or character". An alternative meaning is "the achievement of something desired" (the example given is winning a championship).

No mention anywhere here about delivering something in a van.

Yet when we tried typing the word "fulfilment" into a Web search engine, the first 22 search results were about the supply chain. You had to go down to item 23 to find a link to something about "wish fulfilment", and then down a further six for one about life being "a challenge and a circumstance".

Quite a pendulum-swing there, then. It seems the people who program Web search engines now consider "fulfilment" first and foremost a technical term.

The key is really the context. In a lay environment, fulfilment is a lay term. In the supply chain, it's actually a long-established and pretty well-defined activity. And in a sense it does mean achieving something desired - desired by the customer, that is.

Historically, fulfilment often tended to mean the nuts and bolts of a marketing or customer relations initiative. It could apply to something as apparently mundane as stuffing things in envelopes and mailing them out in large quantities. It was what fulfilment houses did. And it still carries a residual sense of that function now, although if this was ever an accurate definition of fulfilment, things have moved on a long way since then.

Not that there's anything simplistic about fulfilment in that early, narrower sense. It can be highly complex, involving advanced printing, collating and sorting technologies, plus some slick database management. It's a real speciality in the broader logistics spectrum.

The question that's always hovered over this kind of fulfilment is how broadly the term can be applied. In particular, what kind of items can be "fulfilled"? In the purest terms they would probably be printed matter - promotions, circulars, catalogues, reminders, forms to fill in, even newsletters and magazines. These might be mailed out cold, or sent in response to a request from the recipient: hence "response handling".

They might also be physical objects - point-of-sale materials and other marketing collateral, or a free gift perhaps, or a small item someone has sent away for. And that takes the activity into the realms of "mail order fulfilment", or despatching things people buy from catalogues or through other direct sale channels.

And from here it's only a small hop to we now know as "logistics". Admittedly, until recent years few people in that field would have acknowledged the connection. They were accustomed to storing goods in bulk and despatching them in truckloads or pallet-loads to a single point. "Fulfilment" would probably have seemed too narrow to most of them.

Then along came the Internet, bringing with it new concepts like e-commerce, e-tailing and home delivery; and things were never the same again. This new medium required its own storage and distribution discipline, and "fulfilment" seemed to sum it up. It was the term that stuck.

Except for one thing. If there was an "e" in the means of purchase, there had to be an "e" in the fulfilment too. Thus "e-fulfilment" was born.

Why not "e-logistics"? Well, to some extent that term was used too. Before we launched e.logistics Magazine in 2000, we did extensive research to make sure we could show documented prior use of the term, and that it wasn't somebody's proprietary name; and we found hundreds of references to it all over the world.

But e-logistics quickly came to mean any logistics with some kind of high-tech element - particularly if it involved something else with an "e" in it, such as e-marketplaces or e-procurement. The world wanted another term to describe the process of delivering things people were buying on the Internet; and "e-fulfilment" seemed to fit that bill.

Fine; so was "e-fulfilment" just ordinary fulfilment with the accent on online selling? Well, no. If "traditional" fulfilment was already breaking out of its previous bounds, e-fulfilment took that process a significant stage further, encompassing more components than were ever inherent in the traditional function.

A succinct and elegant summary is offered by fulfilment (or should that be e-fulfilment?) specialist Findel, which says e-fulfilment "refers to the integration of people, products, systems and processes to meet customer requirements before, during and after online purchasing."

By that standard, it wasn't just about realising an expectation, which essentially meant tacking something on to the end of an existing process. It was also the process itself.

Which is exactly as you'd expect, given the nature of the emerging dotcom market. Many suppliers were going online without any logistical capabilities of their own at all. They needed outsourcing companies who could bring all the necessary skills to bear. So right from the outset, "e-fulfilment" automatically meant far more than fulfilment as we knew it.

IBM recognised that distinction, and talked of the Internet "creating new retail business models, but models which still require goods to be delivered."

So what were all these additional functions? They might include Web design and hosting, catalogue management and content management. They often included call-centre management, order-taking and processing, credit checking and payment processing. They might also include product sourcing, deferred assembly and collation, and certainly storing, picking, packing and despatching. And then of course there's final delivery and returns management. And crucially, most of these functions had to allow orders to be handled on a one-to-one basis.

So who were the companies that could offer all this? Well, of the third-party suppliers who rushed to fill the breech, it's probably fair to say that most came from a traditional fulfilment background. Admittedly, they didn't all have all the necessary capabilities, but they were often the best-placed to develop them or buy them in.

In particular, many had at least some experience of direct consumer interaction (something most big third-party logistics firms lacked). They also had medium-sized warehouses with the right kind of flexible layout. They were accustomed to complex collation jobs, and had versatile staff who were familiar with multiple picks and packing to make up single orders.

Thus we saw the emergence of a whole generation of expanded and reinvented fulfilment specialists such as 2Touch, Findel, Netpack, Prolog, SAM Direct and Two-Ten Communications, plus newcomers such as iForce who drew on similar skills.

They weren't alone, of course. The logistics world also contributed significant players such as Tibbett & Britten and Gist, who now use the term "e-fulfilment" to describe this aspect of their abilities. And the catalogue world brought us Business Express, Zendor, Parcelnet and Reality (though Reality has now stopped taking on new e-fulfilment business).

But what about the "e" word? Well, in the early days of the e-commerce revolution, many of these emerging specialists in this field started to append an "e" to their activities. They were e-fulfilment companies, and we were all supposed to know what that meant: fulfilment and a lot more besides.

But more recently, something strange has been happening. Some of them have dropped the "e", while others never even picked it up in the first place. The original term, "fulfilment", has simply come to mean all these new and exciting functions on top of the narrower original interpretation of the word.

And just to muddy the waters a bit further, now that the term "fulfilment" is being used so frequently, it's being hijacked by companies in the logistics mainstream and given an even wider meaning. Increasingly, you hear it used simply to mean "a logistics package", or "delivery", or pretty well anything the listener might want. It's being applied in much the same way as that overworked term "solution", and with about as little precision.

So what do we conclude? Well, for a start, there's no point in being prescriptive. People will use whatever term they like; you can't push water uphill. What can probably be safely said is this: if you know you want the full panoply of logistics functions involved in supporting an online e-tail venture, you probably won't go wrong if you talk to companies offering "e-fulfilment".

But you should also be talking to many companies that offer fulfilment without the "e". Many of them will be offering exactly the things you want too, and more besides. Basically, the e-commerce revolution has "upped the ante" in terms of what fulfilment means, and it seems unlikely that anyone will turn the clock back.

We can perhaps take comfort in reflecting that even if fulfilment has gone into a period of fundamental change, at least we know what e-fulfilment is.

Or do we?

Maybe; but there's an exception to prove every rule. While we were casting around to prepare this article, we came upon a past announcement by ERP software house Baan. The company, we were told, had helped put in place an e-commerce solution for aero engine manufacturer Snecma that would make possible "fast and efficient e-fulfilment across its enterprise."

So there you have it. E-fulfilment may be good for delivering home shopping, but it's also good for aircraft engines.

Back to the drawing board.

e-fulfilment: what do YOU think it means?

When preparing our e.fulfilment Guide series, we had to think hard about the meaning of e-fulfilment, and came up with a working definition. We amended this slightly for the e.fulfilment Guide 2003, which incidentally is now available for the highly affordable price of £47.50 (contact details on page 26). It now runs as follows:

"E-fulfilment means performing or managing key functions in the physical process of delivering products in single units to individual end users, whether business or consumer, where the Internet plays a significant role in the ordering or execution; and providing or controlling the IT infrastructure to do this."

Is this too narrow? Does it sum up the subject adequately? If you've got a better definition of "e-fulfilment", drop it to us on peter@elogmag.com (no more that 100 words please), and we'll print it in the next issue. If someone comes up with a real gem, we'll give them a modest prize!