Typically, after the enterprise resource planning (ERP) software has settled in, you may start to investigate ways to improve your warehouse management and operations through the use of a warehouse management system (WMS). Unless you're faster than a speeding bullet and can leap tall buildings in a single bound, normally you do not install both ERP software and a WMS at the same time. Regardless of your approach, early on you will notice an overlap in warehouse functionality between the ERP software and a WMS. When comparing the warehouse functions and features embedded in ERP software against those in a WMS, the ERP software usually comes out on the short end of the measuring stick. So your path is obvious; use the WMS for inventory related functions. Not so fast big fellow.
Focusing on warehouse functionality that is typically contained in both software solutions, this article discusses the merits of using the features of one software solution over the other. This discussion will concentrate on outbound, inbound, and miscellaneous warehouse processes. Most importantly, it concludes with an identification of the critical interfaces, where a majority of the work is to be done. While there are no exactitudes and you may be left with more questions than answers, completing the thought process can help you gain an appreciation of the complexities of making these two software solutions work together effectively for your organization.
Outbound Processes
The outbound function consists of processes that deal with getting product to the customer. As shown on the outbound processes chart, there are functions such as order taking, invoicing, cash receipts, and accounting activities that are not part of a warehouse's operations. The choice for each of these processes is simple since they should only exist in the ERP software. However, when discussing inventory, there are several choices. Picking comes in two flavors: (1) picking for production orders and (2) picking for customer orders.
Picking for production orders is the process whereby ingredients and parts are moved from the warehouse to the production lines. Typically, the decision on what to make or produce is based on what you have in inventory in terms of ingredients and parts. There is considerable scheduling and setup required for a production run. Furthermore, a decision to make one product over another could make resources and equipment unavailable for other operations. This all means that assurances must be made that you can actually make what you plan and schedule. For these reasons, picking of ingredients and parts should be an integral part of the production cycle. Since production is part of the ERP software, it makes most sense that picking for production orders should also be made in and using the ERP software.
Picking for customer orders is the process of selecting finished goods resulting from production runs, assembling them for shipment and loading, and, then, shipping the goods to customers. Assuming that you produce in bulk or volume, picking for customer orders occurs more frequently and in smaller quantities (See TEC article on What You Know Before Selecting A WMS Posted on May 29, 2003). Consequently, efficiencies to be gained from these picks can be more significant and numerous than those for production orders. Rules for tweaking the way picks are generated are typically more flexible and accommodating in a WMS. For this reason, picks for customer orders should be made in the WMS. To complete the customer order processing, it is only logical to perform the shipping and logistical processes in the WMS as well.
You will have to wait until the exciting conclusion to read where the official inventory, both ingredients and finished goods, are to be maintained. The fact, that inventory has to be updated in both the ERP software and the WMS, doesn't offer much of a clue.
Inbound Processes
The inbound function consists of processes that deal with ordering, receiving and storing material used to manufacture products. As with the outbound discussion, there are certain processes for which there is no choice. These processes include purchasing and purchase order generation, vendor invoice processing, cash disbursement, and accounting activities as indicated in the inbound processes chart.
Disposing of these administrative tasks, the physical act of receiving and storing the inventory in the warehouse can best be accomplished in the WMS.
Even when not using ERP software, purchasing information needs to be ported to the WMS in order that receipts can be validated and approved. Since at some point information must be transferred and inputted into the WMS, receiving represents a clean demarcation. This being the case, the receiving process initiates the inbound processes resident in the WMS. A WMS will have putaway logic to suggest stock locations whereby ingredients and goods are more readily accessible, reduce warehouse travel time, and maximize the use of available space. Likewise, since this inventory will eventually be used to satisfy production and customer orders, it is logical to use the barcode and label functionality available in a WMS as materials are being placed into stocking locations. Again, inventory updating would need to be accomplished in both software systems.
Miscellaneous Processes
Miscellaneous processes consist of those activities needed to ensure that the warehouse inventory is accurate and that promote good warehouse practices and procedures. These processes include inventory control and management, stock consolidation, and stock locator. Inventory control and management includes physical and cycle counting and intra and inter-warehouse transfers.
It is a general rule of thumb that a software solution that focuses on one discipline is better at supporting the single discipline as opposed to software supporting multiple disciplines. This is why you look to a WMS to satisfy these miscellaneous processes. A prime benefit of a WMS is suggested inventory movements and consolidations to increase warehouse efficiencies. Inventory counting schemas in a WMS are typically more adaptable to your environment, thereby creating the least downtime and disruption to warehouse operations.
Obviously, inventory management functionality of both software solutions needs be evaluated objectively. However, any WMS worth its reputation and cost should be able to provide more effective tools to solve your existing warehouse problems. If not, you should question the purchase of a WMS in the first place.
SOURCE:-
http://www.technologyevaluation.com/research/articles/erp-and-wms-co-existence-when-system-worlds-collide-16984/
Focusing on warehouse functionality that is typically contained in both software solutions, this article discusses the merits of using the features of one software solution over the other. This discussion will concentrate on outbound, inbound, and miscellaneous warehouse processes. Most importantly, it concludes with an identification of the critical interfaces, where a majority of the work is to be done. While there are no exactitudes and you may be left with more questions than answers, completing the thought process can help you gain an appreciation of the complexities of making these two software solutions work together effectively for your organization.
Outbound Processes
The outbound function consists of processes that deal with getting product to the customer. As shown on the outbound processes chart, there are functions such as order taking, invoicing, cash receipts, and accounting activities that are not part of a warehouse's operations. The choice for each of these processes is simple since they should only exist in the ERP software. However, when discussing inventory, there are several choices. Picking comes in two flavors: (1) picking for production orders and (2) picking for customer orders.
Picking for production orders is the process whereby ingredients and parts are moved from the warehouse to the production lines. Typically, the decision on what to make or produce is based on what you have in inventory in terms of ingredients and parts. There is considerable scheduling and setup required for a production run. Furthermore, a decision to make one product over another could make resources and equipment unavailable for other operations. This all means that assurances must be made that you can actually make what you plan and schedule. For these reasons, picking of ingredients and parts should be an integral part of the production cycle. Since production is part of the ERP software, it makes most sense that picking for production orders should also be made in and using the ERP software.
Picking for customer orders is the process of selecting finished goods resulting from production runs, assembling them for shipment and loading, and, then, shipping the goods to customers. Assuming that you produce in bulk or volume, picking for customer orders occurs more frequently and in smaller quantities (See TEC article on What You Know Before Selecting A WMS Posted on May 29, 2003). Consequently, efficiencies to be gained from these picks can be more significant and numerous than those for production orders. Rules for tweaking the way picks are generated are typically more flexible and accommodating in a WMS. For this reason, picks for customer orders should be made in the WMS. To complete the customer order processing, it is only logical to perform the shipping and logistical processes in the WMS as well.
You will have to wait until the exciting conclusion to read where the official inventory, both ingredients and finished goods, are to be maintained. The fact, that inventory has to be updated in both the ERP software and the WMS, doesn't offer much of a clue.
Inbound Processes
The inbound function consists of processes that deal with ordering, receiving and storing material used to manufacture products. As with the outbound discussion, there are certain processes for which there is no choice. These processes include purchasing and purchase order generation, vendor invoice processing, cash disbursement, and accounting activities as indicated in the inbound processes chart.
Disposing of these administrative tasks, the physical act of receiving and storing the inventory in the warehouse can best be accomplished in the WMS.
Even when not using ERP software, purchasing information needs to be ported to the WMS in order that receipts can be validated and approved. Since at some point information must be transferred and inputted into the WMS, receiving represents a clean demarcation. This being the case, the receiving process initiates the inbound processes resident in the WMS. A WMS will have putaway logic to suggest stock locations whereby ingredients and goods are more readily accessible, reduce warehouse travel time, and maximize the use of available space. Likewise, since this inventory will eventually be used to satisfy production and customer orders, it is logical to use the barcode and label functionality available in a WMS as materials are being placed into stocking locations. Again, inventory updating would need to be accomplished in both software systems.
Miscellaneous Processes
Miscellaneous processes consist of those activities needed to ensure that the warehouse inventory is accurate and that promote good warehouse practices and procedures. These processes include inventory control and management, stock consolidation, and stock locator. Inventory control and management includes physical and cycle counting and intra and inter-warehouse transfers.
It is a general rule of thumb that a software solution that focuses on one discipline is better at supporting the single discipline as opposed to software supporting multiple disciplines. This is why you look to a WMS to satisfy these miscellaneous processes. A prime benefit of a WMS is suggested inventory movements and consolidations to increase warehouse efficiencies. Inventory counting schemas in a WMS are typically more adaptable to your environment, thereby creating the least downtime and disruption to warehouse operations.
Obviously, inventory management functionality of both software solutions needs be evaluated objectively. However, any WMS worth its reputation and cost should be able to provide more effective tools to solve your existing warehouse problems. If not, you should question the purchase of a WMS in the first place.
SOURCE:-
http://www.technologyevaluation.com/research/articles/erp-and-wms-co-existence-when-system-worlds-collide-16984/
No comments:
Post a Comment