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What is a WMS?

SHD asks and answers: What is a warehouse management system?

Once upon a time, warehouse management involved a person armed with a clipboard on which rested the paper forms that had to be filled-in every time a product was received, moved or shipped.

Of course, tracking product movement on paper – either within a warehouse building or as an item leaves the store and begins its journey to the customer – often meant generating stacks of records and gathering the key information required to enable management to understand what was happening inside their warehouse often involved shuffling through seemingly bottomless piles of documents.

But over the past two decades or so, the clipboard has all but disappeared – replaced by software systems capable of not only supporting but also optimising warehouse functionality and management.

Modern warehouse management systems – usually referred to by the initials, WMS - perform the processes required to ensure the smooth operation of every major, as well as many of the minor, warehouse tasks - such as receiving goods, inspection and acceptance processes, product put-away, the internal replenishment of items to picking positions, picking and packing, order assembly, vehicle loading etc etc.

In simple terms, a WMS receives orders from an organisation’s overlying host system, which, more often than not, is an ERP. The WMS manages these orders in a database and, after appropriate optimisation, supplies them to connected materials handling equipment or warehouse staff.

A modern WMS can connect to a variety of communication technologies (radio frequency), automatic ID technologies (barcode, RFID etc), mobile computers and automated material handling equipment, such as conveyors and sortation systems as well as storage equipment like carousels and automatic storage and retrieval technology.

“Today’s WMS sit at the centre of increasingly sophisticated supply chains – not just providing ever more functionality within the warehouse but interfacing with greater numbers of business and customer facing applications. They continue to drive cost and complexity from the supply chain, improve accuracy and increase productivity. The future is likely to bring equally significant developments,” says Alex Mills of ProSKU and Chess Logistics Technology.

Indeed, for today’s supply chain professional, focusing on physical distribution and operations, few things are more mission critical than the warehouse management system.

“WMS selection is exceptionally important,” says Snapfulfil’s Tony Dobson. He continues: “There are two levels of requirements to focus on. The first are strategic, the second are tactical (process and outcome). Your strategic requirements fall under large labels: Labour, Resource Utilisation, Space Utilisation, Inventory Carrying Costs, etc. Your tactical requirements support the improvement or the accomplishment of the strategic; that is, use tactics to support strategy.”

Although WMS is a relatively mature technology, changing customer requirements – especially in the retail sector – continue to drive a range of new developments in the market. For example, Cloud and SaaS models are making best of breed WMS solutions more widely accessible, allowing smaller organisations to implement top-notch WMS technology in a fraction of the time and at a much lower risk than is typical of a traditional, on-premise system.

But, slightly astonishingly, there are still plenty of companies - both large and small –that continue to run their warehouses with paper based systems. This tends to occur either among manufacturers who consider a separate WMS unnecessary because they have very limited WMS modules within their ERP software, or much smaller companies who are in early stages of growth and not making best use of technology because they are burdened by the need to achieve daily sales orders. In both cases, the chance to make very significant cost savings and process improvements are being missed.

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