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Warehouse Management System - Choosing WMS product and its supplier

Warehouse Management Systems are on the wave
Over past few years, it is possible to see a clear tendency, when more and more companies consider implementation of a warehouse management system. For these solutions, the English phrase "Warehouse Management System” has become commonly used, and to the many favorite acronyms in the IT branch, another one was added: WMS. In this regard, we limit ourselves only to systems that are built on using mobile technology, a wireless network and barcodes as the most widely used and cheapest methods for automatic identification of goods, although of course there also exist WMS in “printed” version without the support of mobile technology.

WMS are more and more deployed also by small and middle sized companies
Large distribution center and warehouses of large, mainly foreign companies were the target market for these systems in the past. What are the reasons that even relatively small companies have lately begun to consider WMS? One of the main reasons can certainly be found in the sharp drop in prices of necessary hardware. In comparison with the situation eight years ago, prices of mobile terminals have dropped by perhaps two-thirds. An even more radical drop in prices occurred for wireless technology. Thanks to the pleasant exchange rate development and the arrival of mass production of WiFi technologies, costs for wireless infrastructure have reached a level acceptable even to small companies. Aside from the certainly pleasant drop in prices, a vehicle for demand for systems for warehouse management is the effort of companies to decrease warehousing operational costs, to increase work productivity therein and to minimize errors when performing operations. Also, growing wage costs are a significant motivation for investing in WMS. If such an investment was still nearly unrecoverable in the middle of the 1990s from the aspect of savings on wage costs, now with the average wage reaching CZK 20,000 the situation has greatly changed. The return on investment into WMS often comes within two years only from the aspect of decreased wage costs, and it doesn’t express further financial benefits of this technology.

Every company that considers implementing the WMS system stands before the difficult task of choosing the correct product and supplier. So what then are the possibilities? Either the company ERP system has available some module for warehouse management, or a specialized WMS system is implemented by a company dealing in warehouse management. The third possibility is verifying the ERP supplier by completing development of the necessary superstructure. What advantages and disadvantages do these paths represent?

WMS module within the framework of ERP
If the deployed company information system has available a warehouse management module, and such a module suits the customer from the viewpoint of functionality and process elaboration, this is certainly the best variation and the fastest path to successful fulfilment of the goal. Unfortunately, this route isn’t very widely used in practice, because only few ERP warehouse management systems provide support to the required level, and if a WMS module exists, its functionality is often designed quite generally. This often doesn’t necessarily resolve all processes and logistical procedures required by the customer. An advantage to the system is obviously the fact that it concerns a “seamless” solution within the framework of one information system.

Development by ERP supplier
Asking for a WMS solution at your ERP supplier is a possibility, which apparently nearly everybody attempts. The consideration is logical throughout, but unfortunately this variation is perhaps the worst with the exception of simple, uncomplicated solutions. If WMS is to fulfill demanding logistical requirements, then it will concern a very complex application, whose development takes a number of years and requires very refined know-how in a number of areas, which are far from normal PC applications. It is necessary to grasp the problematic of programming mobile terminals, not so much from the technical aspect, but mainly from the aspect of the philosophy of handling mobile applications.

There’s a big difference between controlling the application with a full keyboard and mouse with information on a large monitor, and with a mobile terminal oftentimes equipped with just a numerical keyboard and a small display. At the same time, such an application may not have any narrow areas, and service technicians must be capable of resolving even non-standard situations immediately. To develop WMS, sufficient experience with barcodes and their printing on special label printers are also an absolute prerequisite. Although system integrators often do not have such know-how, in the vision of acquiring the job, they often offer such services to the customer. A disadvantage to a turn-key solution is also limited further development of such a system, and the necessity to pay for development completion of every change, which the customer requires.

Implementation of specialized software for WMS
Use of a specialized product for warehouse management brings forth advantages of wide functionality, and the possibility of configuration settings of a series of parameters. An important advantage is continual development of such a product, so the customer has available new and improved versions with new functionality, which react to development of technologies as well as logistical processes. In the event that the customer chooses this route, it is essential to form a functioning, reliable data interface, by which WMS will communicate with the company information system. This is apparently the only complication of this solution. With the help of modern technology such as XML and Web service, this may however be resolved effectively and reliably.

If a decision is made to implement WMS, and the phase comes for holding a tender, it is useful to ask potential suppliers a number of questions. What are their references, where is their system already satisfactorily deployed, what part of the requested functionality contains the present version, and what portion must still be developed, how is it with the upgrade to a newer version, and at the same time, what occurs with the functions that were adjusted for the customer. Only in this way is it possible to form the correct impression about individual offers, and to successfully choose the optimum system and its supplier.


Tomáš Kubicek, Marketing Manager
Barco, s.r.o.
tel.: +420 572 520 038
email: tkubicek@barco.cz
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