Warehouse Management System

WAREHOUSE MANAGEMENT SYSTEM
T Malini
•The primary purpose of a WMS is to

control the movement and storage of materials within
an operation
and process the associated transactions.
Directed picking, directed replenishment, and directed

put away are the key to WMS
The detailed setup and processing within a WMS can
vary significantly from one software vendor to another.
WAREHOUSE AND INVENTORY MANAGEMENT

• The basic logic will -where to stock,

use a combination of -where to pick,
– Item
– location, determine - what sequence to
– quantity, perform these
– unit of measure,
operations.
– order information

• Advantages of WMS:
– One proven method for increasing customer
service without incurring additional long-term
expenses is the implementation of a warehouse
management system (WMS).
– WMS can provide an organization with tangible
benefits quickly, improving warehouse operations
and increasing efficiencies without adding
headcount.

• Advantages of WMS:
– Directed put-away and directed order picking
– Warehouse capacity management
– Radio Frequency (RF) capability for data capture
– Load planning
– Cross docking
– Picking optimization
– ABC stratification
– Interleaving of work

WAREHOUSE MANAGEMENT SYSTEM-
Tangible cost
CATEGORY • Reasons
• Inventory reduction of up • Inventory visibility
to 10% (one-time and accuracy.
savings). • Lower inventory
• Reduced inventory levels; higher space
carrying costs up to 35% utilization.
(industry average).
• Reduced investment – • Reduced inventory.
cost of money @ 8%
Tangible Cost
CATEGORY REASONS
• Premium shipping costs • Reduced shipping
errors.
• Personnel handling paper - • WMS automates the
potential headcount management of order
reduction or resource and priorities,
redeployment* eliminating paper.
• Personnel handling order
picking - potential • RF based picking
headcount reduction or productivity increases
resource redeployment* efficiencies.

Tangible Cost
CATEGORY REASONS
• Personnel handling • Eliminate preparation
shipping paperwork and work for shipping
confirmation - potential documents and ERP
headcount reduction or ship confirmations.
resource redeployment*
• Cycle counting will
• Eliminate physical
replace physical
inventory
inventory
requirement.

At a bare minimum a WMS should

 Have a flexible location system.
 Utilize user-defined parameters to direct
warehouse tasks and use live documents to execute
these tasks.
 Have some built-in level of integration with data
collection devices.

Do we really need WMS?

• Not every warehouse need a WMS
• Certainly any warehouse could benefit from some of
the functionality
• But is the benefit great enough to justify the initial
and ongoing costs associated with WMS?

• Warehouse Management Systems are big, complex, data

intensive, and applications.
• They tend to require a lot of initial setup, a lot of system
resources to run,
• and a lot of ongoing data management to continue to run.
• That’s right, you need to "manage" your warehouse
"management" system.
• An often time, large operations will end up creating a new
IS department with the sole responsibility of managing the
WMS.

The Claims:
• WMS will reduce inventory!
• WMS will reduce labor costs!
• WMS will increase storage capacity!
• WMS will increase customer service!
• WMS will increase inventory accuracy!

• The implementation of a WMS along with automated

data collection will likely give you
– increases in accuracy,
– reduction in labor costs (provided the labor required
to maintain the system is less than the labor saved on
the warehouse floor),
– and a greater ability to service the customer by
reducing cycle times

• Expectations of inventory reduction and increased storage

capacity are less likely.
• While increased accuracy and efficiencies in the receiving
process may reduce the level of safety stock , the impact of
this will be negligible in comparison to overall inventory
levels. The predominant factors that control inventory levels
are lot sizing, lead times, and demand variability. WMS will
not impact any of these factors.
• WMS provides the tools for more organized storage resulting
in increased storage capacity-how sloppy your pre-WMS
processes were.
• Beyond labor efficiencies the determining factors in

deciding to implement a WMS tend to be more often
associated with the need to do something to service
your customers that your current system does not
support (or does not support well)
– first-in-first-out, cross-docking, automated pick
replenishment, wave picking, lot tracking, yard
management, automated data collection, automated
material handling equipment, etc

Set Up
The setup requirements of WMS can be extensive.
The characteristics of each item and location must be
maintained either at the detail level or by grouping similar
items and locations into categories.

An example of item characteristics at the detail level

- exact dimensions and weight of each item in each unit of measure
the item is stocked (cases, pallets, etc)
-whether it can be mixed with other items in a location,
- whether it is rackable, max stack height,
-max quantity per location,
-hazard classifications,
-finished goods or raw material,
- fast versus slow mover, etc
Although some operations will need to set up each item this way, most
operations will benefit by creating groups of similar products
If this sounds simple, it is…well… sort of.

In reality most operations have a much more diverse product mix and
will require much more system setup.
And setting up the physical characteristics of the product and locations
is only part of the picture.

You have set up enough so that the system knows

• where a product can fit
• how many will fit in that location.
– You now need to set up the information needed to let the
system decide exactly which location to pick from, replenish
from/to, and put away to,
– what sequence these events should occur (remember WMS is
all about “directed” movement).
– You do this by assigning specific logic to the various
combinations of item /order /quantity /location information
that will occur.

Listed below are some of the logics used in

determining actual locations and sequences:
Location Sequence.
This is the simplest logic; you simply define a flow
through your warehouse and assign a sequence number
to each location.
In order picking this is used to sequence your picks to
flow through the warehouse,
In put away the logic would look for the first location in
the sequence in which the product would fit.

Zone Logic.
By breaking down your storage locations into zones you
can direct picking, put away, or replenishment to or from
specific areas of your warehouse.
Since zone logic only designates an area, you will need
to combine this with some other type of logic to
determine exact location within the zone.


Fixed Location.
Logic uses predetermined fixed locations per item in
picking, put away, and replenishment.
Fixed locations are most often used as the primary
picking location in piece pick and case-pick operations;
however, they can also be used for secondary storage.


Random Location.
Since computers cannot be truly random (nor would
you want them to be) the term random location is a little
misleading.
Random locations generally refer to areas where
products are not stored in designated fixed locations.
Like zone logic, you will need some additional logic to
determine exact locations.


First-in-first-out (FIFO).
Directs picking from the oldest inventory first.
Last-in-first-out (LIFO).
Opposite of FIFO..


Quantity or Unit-of-measure.
Allows you to direct picking from different locations of
the same item based upon the quantity or unit-of-
measured ordered.
For example, pick quantities less than 25 units would
pick directly from the primary picking location while
quantities greater than 25 would pick from reserve
storage locations

Fewest Locations.
This logic is used primarily for productivity.
Pick-from-fewest logic will use quantity information to
determine least number of locations needed to pick the
entire pick quantity.
Put-to-fewest logic will attempt to direct put away to the
fewest number of locations needed to stock the entire
quantity. It results in very poor space utilization.
The pick-from-fewest logic will leave small quantities of
an item scattered all over your warehouse, and the put-to-
fewest logic will ignore small and partially used locations.
Pick-to-clear.
Logic directs picking to the locations with the smallest
quantities on hand. This logic is great for space
utilization. .
Reserved Locations.
This is used when you want to predetermine specific
locations to put away to or pick from.
An application for reserved locations would be cross-
docking, where you may specify certain quantities of an
inbound shipment be moved to specific outbound
staging locations or directly to an awaiting outbound
trailer.
Nearest Location.
Also called proximity picking/put away, this logic looks to
the closest available location to that of the previous put
away or pick.
You need to look at the setup and test this type of logic to
verify that it is picking the shortest route and not the actual
nearest location.

Maximize Cube.
Cube logic is found in most WMS systems however it is
seldom used.
Cube logic basically uses unit dimensions to calculate cube
(cubic inches per unit) and then compares this to the cube
capacity of the location to determine how much will fit.
Now if the units are capable of being stacked into the
location in a manner that fills every cubic inch of space in
the location, cube logic will work.
Since this rarely happens in the real world, cube logic
tends to be impractical.
Consolidate.
Looks to see if there is already a location with the same
product stored in it with available capacity. May also
create additional moves to consolidate like product stored
in multiple locations.

Lot Sequence. Used for picking or replenishment, this

will use the lot number or lot date to determine locations
to pick from or replenish from.
It’s very common to combine multiple logic methods to
determine the best location. For example you may chose
to use pick-to-clear logic within first-in-first-out logic
when there are multiple locations with the same receipt
date. You also may change the logic based upon current
workload. During busy periods you may chose logic that
optimizes productivity while during slower periods you
switch to logic that optimizes space utilization

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What are the main components of a warehouse management system?

What are the main components of a warehouse management system?

What are some advantages of implementing a WMS?

What are some advantages of implementing a WMS?

WAREHOUSE MANAGEMENT SYSTEM

•The primary purpose of a WMS is to

Directed picking, directed replenishment, and directed

WAREHOUSE AND INVENTORY MANAGEMENT

• The basic logic will -where to stock,

WAREHOUSE AND INVENTORY MANAGEMENT

WAREHOUSE AND INVENTORY MANAGEMENT

WAREHOUSE AND INVENTORY MANAGEMENT

WAREHOUSE AND INVENTORY MANAGEMENT

WAREHOUSE AND INVENTORY MANAGEMENT

At a bare minimum a WMS should

WAREHOUSE AND INVENTORY MANAGEMENT

Do we really need WMS?

WAREHOUSE AND INVENTORY MANAGEMENT