Increased efficiency and productivity are music to any distributor’s ears, and you can achieve both with one solution: a warehouse management system (WMS). Bear in mind, however, that successfully installing a WMS requires extensive planning and a fair amount of financial resources.
Implementing and Investing
Implementing a WMS can enhance inventory flow management and transaction processing by easing inventory stocking, picking and replenishing activities. Depending on the type of functions offered with the software selected, a WMS can also facilitate a variety of important warehousing activities, such as automated data collection and material handling.
But is investing in a WMS the right decision for every distributor? Honestly, no. As with similar undertakings, you must carefully weigh the costs vs. the benefits because, like other distributors, you may be unable to justify the initial, often sizable, investment.
Plus, you can’t just plug in a WMS and expect it to run on its own. Setting up and operating this application is often a complex process. You’ll need to dedicate resources to manage the data-intensive system — your WMS may even warrant its own staff.
Classifying Inventory Data
When comparing the costs and benefits, keep in mind that implementing a WMS involves classifying inventory data by physical characteristics. You might need to capture and maintain inventory item details including size dimensions, weight, how the item is stocked, stacking height, hazard precautions, and movement rate.
Other necessary data includes order sequence logic for directing stocking, picking and replenishing activities. You can even base order sequence for these activities on either the first-in, first-out or last-in, first-out inventory accounting method. Of course, you’ll want to adjust the specified logic based on workload changes and busy seasons. Subsequently, the more diverse the product mix, the more complex the WMS setup and implementation process.
Considering Compatibility Issues
As you evaluate whether a WMS is right for your business, also consider how easily it will integrate with your other accounting or resource planning systems, and whether it can support other types of warehouse functions.
For instance, you may want to execute automated data collection using radio-frequency identification technology, or you may have automated material handling equipment (such as automatic guided vehicles or pick-to-light systems) to factor into your decision. In any case, you’ll likely need to do some programming to integrate other systems and equipment, so be sure to plan for these costs.
When implementing a WMS, thoroughly test the new application. It’s better to discover any kinks during a trial run than during a client transaction. Moreover, your system will be only as useful as your staff using it, so take the time to train workers well.
Don’t Make an Impulse Decision
Before making a final decision on whether to implement a WMS, it’s important to review all facets of your distributorship. A WMS can be complex and costly to implement, so task your management team with determining exactly how they’ll use it and how it will integrate with your other systems.
Use BMS to get the most out of your WMS
A warehouse management system (WMS) can help streamline your distribution operations, but do you know how to maximize its return on investment? If not, a business management system (BMS) may be the answer. BMS entails integrating, aligning, standardizing, streamlining and automating business processes and supporting information technology systems for optimum performance and efficiency.
BMS can be particularly useful for distributors. It can unify processes, bring about discipline — among a company’s employees, and to its relationships and interactions with suppliers and customers — and support IT systems, such as WMS, to achieve strategic goals.
June 15, 2012
