Warehouse Management Systems (WMS) are a critical component of most distribution operations. Some operations are able to function at near peak performance by utilizing the warehousing functionality inherent in their order and inventory management systems.
Other operations are more complex and need more than paper pick lists and after-the-fact recording of summary transactions to drive warehousing business processes. These operations require a real-time execution system that is highly tuned to the way they do business. They need a WMS.
WMS solutions vary by industry segment, operating sizes, technical infra-structure preferences, integration re-quirements, and operating philosophy. For many organizations, they represent a huge initial investment of capital and internal resources.
Factors that drive an operation to acquire a WMS include:
- Storage utilization;
- Specialized storage requirements (e.g. frozen, cold dairy, cold meats, perishables, dry goods, bulk goods...);
- Service commitments;
- Order velocity;
- Labor efficiency;
- Inventory accuracy;
- Inventory tracking requirements (e.g. lot and batch control);
- Shipping costs;
- Value-added services.
The potential gains in these areas are generally huge; however, so are the associated implementation and ownership costs.
WMS solutions vary in cost and complexity, but there are three basic sources:
- Best-of-breed software vendors, which offer standalone WMS products or extended supply chain execution software suites;
- Enterprise Resource Planning (ERP) vendors, which offer integrated warehouse management modules;
- Custom solutions developed by the end-user firm or a third-party contractor.
Change: A Constant Companion
Acquisition is only the first step in achieving positive benefits for a WMS. Any solution must be properly implemented, managed, and utilized to achieve its full potential.
A WMS is a complex execution system that needs to reflect the subtle nuances of a distribution operation. And since change is a constant companion in the supply chain world, distribution operations must continually evaluate how they do business given the evolving face of their supply chains.
Consequently, any organization that employs a WMS solution should continuously seek to improve its utilization of this valuable tool.
Solutions are implemented for a variety of business needs, as noted above, but many operations that make this initial investment fail to seek ways to improve their WMS utilization.
Furthermore, they fail to effectively manage their ownership processes so that strategic and tactical decisions are properly made on upgrades and replacements.
To ensure you are getting the most out of a warehouse management solution, follow these six key guidelines.
- Customization is key: Few DCs use their WMS to support operations without significant configuration or customization efforts. Like many IT applications in the 21st century, the WMS system can be tailored to meet the demands of your company. Take advantage of the customized applications upfront. This will allow for more ease and efficiency in the long run. Whether looking at an initial acquisition or upgrading an existing package, an organization should accept this fact and realistically assess the cost to take the next step.
- See the big picture: Most companies with a WMS focus on the core functions: receiving, storage, picking and shipping. Unfortunately, many operations never get beyond these core processes. They continue to manage other warehousing functions through manual procedures or standalone systems.
A WMS is capable of doing much more than these core functions. Organizations should examine all processes within their four walls to determine if they should be supported by their WMS solution.