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Warehouse Management Systems
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Material Handling Consultants, Inc. is a World Class industrial engineering firm which specializes in the planning, design, integration, and implementation systems for the manufacturing, transportation, and distribution industries. 

 

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WMS, Warehouse management system, Warehouse Control System, Warehouse management System integration, inventory tracking, order processing, order shipping, inventory replenishment, barcode scanning, RF, Radio

 Frequency, ASNs, edi, supply chain, inventory turns, lean distribution, barcode labels, batch scanner, rf scanner

Warehouse Management Systems  

What exactly is a Warehouse Management System?

A “WMS” is a software program designed to direct the flow of materials both into and out of specific storage locations, in an ordered sequence, based upon a predetermined set of operational parameters.

The WMS software is available from a host of vendors who are classified by price range into three categories. 

  • Tier #1  $750,000 to over $2,500,000

  • Tier #2  $200,000 to $750,000

  • Tier #3  $35,000 to $200,000

Depending upon the vendor, the software may reside on a PC or on a main frame platform.

  • Tier #1 Vendors typically offer mainframe applications

  • Tier #2 Vendors typically offer mainframe applications, some offer PC based platforms or combinations of both  

  • Tier #3 Vendors typically offer PC based platform applications, while a few offer mainframe applications as well

What do these systems do?

The WMS provides a formal structure by which the distribution center’s operational activity is carried out by operators as directed by a precise set of instructions which was created by the distribution center management team. 

These procedures typically are built around the following basic functionality normally included in the WMS

  • Inventory Control 

  • Storage Location Management 

  • Quality Control Interfacing

  • Order Selection

  • Automated inventory replenishment 

  • Receiving 

  • Shipping 

  • Operator Productivity 

  • Report Generation 

An Inventory Control module includes . . .

  • Audit Trails 
    • Who, what, when, and where product was received, placed, and who moved product to location

  • Query 

    • What is the status of any product by FIFO, lot, order number, etc.

  • Lead Time Calculation

    • The ability to relate lead time/ average consumption/ stock and alert purchasing 

A Storage Location Management module includes . . .

  • Random Put-away Algorithms 

  • Integrates storage of product by velocity

  • Location Management . . .

  • Assigns locations by size, weight, volatility, status, etc.  

  • Storage by Type . . .

  • Service Inventory

  • Normal Stock

  • Sales Samples

  • Office Supplies

  • Literature

A Quality Control module includes . . .

  • Quality Control Management . . .

    • Insures QC procedures are performed in accordance with management directives by SKU/ vendor/ etc.

  • Quality Control Hold . . .

    • Prevents products from being released if problems arise 

  • Lot and Batch Tracking . . .

    • Tracks lot and batch product information by SKU/ customer/ etc.

  • Notification . . .

    • Issues reports to proper party should any anomaly occur 

An Order Selection module includes . . .

  • Organize Batch Pick . . .

    • Prepares batch pick plan 

  • Query . . .

    • Permits access to the status of any product by FIFO, lot, order number, etc. at order placement

  • Allocation . . .

    • The ability to distinguish between inventory on-hand and inventory assigned to orders or not available for special purposes

  • Query . . .

    • Permits access to the status of any product by FIFO, lot, order number, etc. at order placement

A Quality Control module includes . . .

  • Quality Control Management . . . 

    • Insures QC procedures are performed in accordance with management directives by SKU/ vendor/ etc.

  • Quality Control Hold . . .

    • Prevents products from being released if problems arise

  • Lot and Batch Tracking . . .

    • Tracks lot and batch product information by SKU/ customer/ etc.

  • Notification . . .

    • Issues reports to proper party should any anomaly occur 

An Order Selection module includes . . .

  • Organize Batch Pick . . . 

    • Prepares batch pick plan 

  • Query . . . 

    • Permits access to the status of any product by FIFO, lot, order number, etc. at order placement 

  • Allocation . . . 

    • The ability to distinguish between inventory on-hand and inventory assigned to orders or not available for special purposes 

  • Query . . . 

    • Permits access to the status of any product by FIFO, lot, order number, etc. at order placement

An Automated Replenishment module includes . . .

  • Stock Replenishment . . . 

    • Compares orders to inventory and automatically creates move reports and a product let down schedule 

A Receiving module includes . . .

  • Integrated Receiving . . .

    • Integrates with PO document and ASNs (Advance Shipping Notification)

    • Permits Blind, Double Blind, or conventional receipts

    • Alerts receiving supervisor to incoming shipments for staffing purposes 

  • Prepares and Routes Internal Documentation . . .

    • Issues warning notifications to purchasing regarding discrepancies

  • Instant Routing  . . .

    • Generates unique routing assignments upon receipt of backordered product

A Shipping module includes . . .

  • Integrated Shipping . . .

    • Creates internal shipping documentation

    • Displays preferred and alternate routing instructions

    • Notifies shipper of special handling requirements

    • Prepares and issues ASNs 

An Operator Productivity module includes . . .

  • Task Performance Records . . .

    • Tracks and records the performance by task and by operator

  • Interleaving Tasks . . .

  • Typically used to improve and track fork truck efficiency by creating dual commands such as store and then retrieve 

  • Routing . . .

    • Creates the most efficient routing in an order selection task

    • Reduces aisle contention 

  • Random Order Checking . . .

    • Generates random order checks to monitor operator performance 

A Report module includes . . .

  • Management (Real Time Status Updates) . . .

    • Staffing

    • Time to complete

    • Percent to plan

    • Inventory levels 

    • Percent of storage system utilization (by type)

    • Locations available for new receipts

  • Departmental Performance Reports . . . 

  • Supervisory Statistical Reports . . . 

Are Warehouse Management Systems reliable?

When managed properly. . . extremely reliable if you follow the rules! In fact most users have found them to be so accurate, they have been able to completely eliminate their need for their annual physical inventory. 

The first rule is . . .

everything has to be somewhere!

The second rule is . . .

everywhere is considered a stock keeping location!

For example: Each and every bin, slot, pallet rack, shelf, fork truck, pallet jack, spot on the floor, dock door, or just out in the yard is considered a stock keeping location! 

Are they justifiable?

Yes . . . many small and medium size firms have been able to realize their ROI within a year or less! 

What forms the basis of their cost justifications?

  • Hard Justification 

    • Elimination of Physical Inventory 

    • Elimination of Order Checking

    • Improves Operator Efficiency 

    • Reduction in Staff 

    • Order Turn Around Time 

    • Improved Order Accuracy

    • Reduction in Inventory Reduced Backorders

  • Soft Justification 

    • Improved Customer Service

    • Improved Inventory Turns

    • Improved House Keeping

    • Improved Work Environment

    • Improved Supplier Relationships

    • Reduced Order Errors

    • Improved Quality Control

Are they really necessary?

A WMS is quickly becoming a requirement more than an option in today’s “Supply Chain” environment. 

It is a essential component of a Lean and Agile Distribution System. 

For example, major members of the Automotive Industry are requiring their Tier #1 subcontractors to have a WMS to which they may have electronic access to at any time.  

Tier #2 subcontractors will soon follow.  

What else is necessary in attaining a "World Class" Lean and Agile Distribution Center status? 

A WMS represents the skeletal framework of your inventory control and management system. 

Two other technologies enhance the performance and reliability of any WMS.

  • Bar-coding 

A barcode is a “machine readable” symbol which may contain product identification information and occasionally lot and batch information as well. 

Typically barcodes are printed on a “man readable” label which is affixed to the part, box, carton, pallet, or container. 

Barcode labels are also affixed to bins, shelves, and pallet rack.  They may be ceiling supported above bulk storage areas, located above shipping and receiving dock doors, or at specific packing or processing stations. 

By identifying each storage location, the WMS keeps track of each move and previous storage location as well as who performed the move.

  • Optical Scanning 

An optical scanner is a laser scanner which is designed to read barcode information. 

It communicates to the WMS by a hardwire connection or the data may be transmitted in a wireless fashion through the use of an RF ‘transceiver.”

In either case information contained in the barcode is transferred to the WMS quickly and accurately.

How do scanners work?

You have two choices when integrating scanning technology with a WMS . . . 

  • Batch Processing

Batch process scanners will accept download information detailing a series of tasks by hardwire from the WMS.  

Operators will follow instructions assigned to the scanner and perform the necessary scans to capture and record movements. 

Upon completing the assigned series of tasks, the operator returns the scanner to the cradle to upload information to the WMS and download a new set of instructions.  

Advantages 

Low Cost

  • RF (Radio Frequency) Communications 

RF scanners will accept download information from the WMS via a transceiver and antennas. 

Operators will follow each instruction sent to the scanner and perform the necessary scans to capture and record movements. 

As each task is completed, the scanner uploads the information to the WMS and a new assignment is issued in real time.

Advantages 

Uploads of data are done immediately. 

Operator errors are reported immediately back to the operator.

Correction instructions are relayed to the operator instantly.

While the WMS provides a formal skeletal structure by which the distribution center’s operational activity is carried out, Bar-coding and Optical Scanning provide the “virtual” muscle power to make the WMS a most effective management tool.

Are You Ready For a WMS?

In order to sustain profitable operations and growth, we are being constantly pressured to learn new ways of doing things and adopt new technology. 

In doing so , we have become acutely aware of our dependencies upon others . . . and our responsibility to others as well!

We are quickly becoming the generation that relies on instant communication.

While instant communication was sufficient for our personal lives, customers and vendors are now looking toward “speed of light” communications in the new business environment. 

Today there is no excuse for not having accurate information available instantly!      

 

What Are The Risks? 

 

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. . . we are independent business consultants and do not represent any manufacturing, software development, distribution, or installation services providers . . .

 

 

 

 

 

 

. . . we do not purchase for resale  any equipment or software . . .   

 

 

 

 

 

 

. . . our goal is to objectively represent our clients' interests . . .

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Find out how to minimize your risk in implementing a WMS?

 

Copyright © 1996-20055 Material Handling Consultants, Inc. All rights reserved.
Revised:
September 28, 2005