Warehouse management systems (WMS) represent a key supply chain toolset which can be utilized to help optimize logistics functions.
WMS’s primary activities involve
• Processing routine warehouse transactions
• Co-ordinate the flow and storage of materials within the warehouse
• Optimize locations (for putaway and picking)
While there are many associated benefits of WMS many companies remain cautious about investing in implementing WMS. There is various reasons behind this which include
More people rather than software
There is a misnomer that rather than invest in a WMS an alternative is to employ more staff (which are typically at the low end of the corporate pay scale) – throwing people at the job is considred quicker and easier and when contrasted with a software implementation less likely to fail. However this approach fails to address optimization improvements that data systems can bring.
Inhouse vs Buy it in
Many companies attempt to use low cost 3rd party applications or more frequently endevour to build
in-house applications that attempt to manage key activities usually related to WMS systems. This can be considered to be more cost effective however this often fails to assess the risks involved with utilizing in house development teams. Once again this method can fail to capitalize on the key optimization opportunities available with a full fledged WMS system.
Integration woes
It is imperative, for WMS deployment to be a success, that implementation includes seamless integration with existing corporate (often legacy) systems. Many organizations are fearful of this and suspect rather than simply deploying a WMS whole scale system changes will be required, especially where they may be relying on legacy ERP applications which will then result in far greater capital outlay.
Lack of strategy
While WMS usage has undoubtedly grown one issue that is impacting the growth of implementation is a lack of defined business strategy and long term business planning. Organizations are often unaware of both the key logistics functions and the ROI opportunities that WMS can offer and can remain locked in to a low technology base in the Logistics function due to a lack of strategy
A lack of understanding regarding ROI can be a key barrier. Long-terms benefits can appear a mystery and concerns about complexity and their application within smaller warehouse sizes can inhibit decision-making. For some, achieving benchmarked levels of warehouse performance is a lower priority to delivering improvements in other areas of the supply chain (for example procurement) and as a result WMS doesn’t achieve senior buy in and projects don’t get launched.
Fear of failure
For some the key reason that WMS are not deployed is fear that the system will not work. Fears over inability to process and ship orders can significantly inhibit green lighting WMS projects. Where processes are not broken (and need to be repaired) concerns over failure in the logistics function which can bring an organization to its knees can result in a cautious approach to WMS implementation.
The real picture
Warehouse Management Systems can be an undoubted success. Software companies can provide comprehensive and effective solutions that deliver best practice, compliancy and ROI. Most solution providers will help manage the change management aspect (which many businesses remain fearful of) through normal consulting routes
There are many benefits relating to WMS from efficiency to accuracy and WMS can offer intangible benefits also. However, as with any software solution, deployment and implementation require careful consideration of a number of factors including requirements, complexity of process, required results and how the WMS will be deployed through utilizing well planned phased inclusive approach.