Is WMS still relevant?
June 1st 2006 Phil Greening, Logistics consultant at Swisslog looks at the importance of best-in-class WMS solutions
This may seem at first consideration a ridiculous question. After all, globalisation, shorter product life cycles, and the emergence of the B2C models all suggest that distribution, logistics, and supply chain functions need to get smarter if competitive advantage is to be sustained. The emergence of the agile supply chain as a strategy to accommodate shortening product life cycles and unpredictable demand, has been enabled by sharing information across the supply chain members through ERP systems.
As the supply chain accelerates the material flow has to match the pace of information, whilst maintaining the ability to flex and accommodate unpredictable demand. It is in this context that execution systems, as opposed to planning systems, offer superior performance.
A WMS is focused on the delivery of superior execution of warehouse tasks, and can only really be advantageous when coupled with best-in-class planning functionality. Why then would any organisation have a strategy that seeks to develop competitive advantage through optimal planning, only to have it compromised by poor execution solutions?
Effective synchronisation
As system-to-system interfacing gets ever easier the argument for best-in-class WMS solutions has arguably never been stronger.
Optimal DC performance is achieved through the efficient deployment of resources; this often requires the combination of mechanised or fully automated material handling concepts with manual operations. The effective synchronisation and orchestration of these different resources is often the challenge faced by warehouse operators.
One of our customers, a large out-oftown retailer, offers a classic example of the effective combination of technology, systems and material handling concepts can combine to deliver changing supply chain objectives. They operate around 200 retail stores in the UK supported by a single DC operation. The main challenge faced by this customer has been the accommodation of a rapidly expanding store population from the same DC. In fact they have already experienced a growth in their retail footprint, yet their DC footprint has remained essentially the same. Increased throughput has been achieved through the closely integrated combination of a best-inclass ERP system, Swisslog's WarehouseManager, Vocollect voice tasking, and a sophisticated Transnorm conveyor and sortation system.
Interestingly it was Swisslog's Warehousing and Distribution systems integration expertise that was the focal point of the implementation programme.
As with the previous customer, one of the leaving beverage manufacturers in the UK have also realised the benefit of selecting a WMS vendor with systems integration expertise. In this case Swisslog's WarehouseManager has once again combined effective material handling concepts within a tightly integrated environment.
Of course the traditional WMS offering, depending on the vendor, is morphing into solutions with different shapes, allowing room for niche players. Some vendors have chosen to broaden their functionality to include some local planning capacity, adding fuel to the argument that WMS vendors are overlapping functionality with ERP systems. Such arguments are simplistic, as the bias of such solutions will always lie in execution not planning. In fact some commentators have dropped the category of WMS vendors from their analysis and simply refer to supply chain execution systems. It is true that WMS functionality has been stretched both in terms of breadth and depth.
If all this seems confusing, it need not be, the case for a WMS need not be ambiguous, when business objectives are clear. The case for a WMS is nearly always based on the mechanisms by which an organisation seeks to develop competitive advantage. Business strategies that may be suite to WMS based execution systems may include: - Advantage developed through product variety
- Advantage based on the service dimension (increasingly demanding service levels)
- Organisations experiencing short product life cycles
- Stock reduction strategies including postponement
It is also important to recognise that the argument for a WMS is not totally contained in cost reduction and payback parameters of a single distribution function.
The supply chain aware business may be seeking to develop some advantage based on achieving greater savings downstream (store friendly deliveries), this strategy may well increase DC costs, and will almost certainly require more complex DC operations which can only be achieved through WMS functionality.
Downstream benefits
The operation used at one of the major FMCG-manufacturers provides a good example of downstream benefits delivered through complex WMS driven applications.
Our customer uses Swisslog's WarehouseManager to configure deliveries against specific customer requirements. In this case the implementation of WMS bought increased benefits, as the WMS is also capable of presenting pick tasks in a sequence that presents the optimal build profile for a specific pallet for a specific customer
In summary organisations seeking DC operational excellence, for whatever business reason must consider the application of a best-in-class WMS in its considerations, if execution is to deliver the planned performance. More articles from Swisslog (UK) Ltd.: | 
