The following is an article written by Al Lovett, Past President of the Long Island Chapter of APICS, in the LI Sounder, called: "Where You There? Warehouse Management Systems".

Everything you ever wanted to know about "Warehouse Management Systems" was presented in a concise format by Ed Avizur, President of A. B. Computer Systems. He touched on many sub-topics which, when implemented, help lead a company to an improved profit picture.

Ed explained to the audience the functionality of various Warehouse Management Systems (WMS) and how the selection of the right system can provide substantial benefits. There are stand-alone systems that interface with your software or a module that is part of an ERP system. Your choice depends upon your current and future needs, so a WMS with flexibility is most important.

The topics covered were: Inventory Management, Benefits, Configuration, Productivity, Cycle Counting, Radio Frequency (RF) and Bar Coding, Transactions, Serial Number and Lot Control, Mechanization, and Selecting a WMS.

He explained the differences between an inventory system and a WMS. The inventory system is typically measuring what is contained within four walls and maybe a few warehouses, whereas a WMS is handling multiple locations with various units of measure, inter-warehouse and distribution transactions, kits, damage area, etc.

A WMS can reduce the number of errors, especially when bar coding / reading is used. As an example, in manual mode, errors can occur 1 in 300 vs. a more automated mode where errors occur 1 in 3 million. There is also an increase in productivity and customer service, because of less materials handling and searching for a place to put or pick materials. Ed indicated that to get the best out of a WMS, RF technology should be utilized. Two-way communications with the server as to where to put material away and what to pick-up is the preferred installation. This can minimize stock-outs and paperwork, which can lead to reduced operational and capital costs. Also a well run WMS using cycle counting can eliminate the annual physical inventory.

A company can set-up e-commerce on the Internet and just distribute from the warehouse, all with a reduction in safety stock because of the efficient operation of the WMS. The configuration of the warehouse and the management system can include a forward pick area for fast moving "velocity stock," special areas based on physical size, weight, or temperature requirements. Locked and bulk sections can be setup. Consolidation staging areas are an efficient way of preparing shipments. Ed said it's a good idea to involve your staff to maximize the best ideas and utilization, like cross docking, where a back-order item arrives at the warehouse but does not get put away, but gets staged to ship immediately.

Productivity can be measured with time stamps as materials are moved by individuals. The WMS will reduce travel time in all warehouse movement. The system will also provide an audit trail, bin utilization, and interleaved transactions - pick, put, and cycle count using ABC analysis. The whole process of a WMS increases communication via real-time data transactions and voice capability right from the warehouse staff member to other key personnel. Mr. Avizur stated that the WMS should be real-time not batch process, since the cost of real-time communication has been substantially reduced.

RF, bar coding, and government and private compliance labeling are important capabilities that should be understood and implemented. You need to learn the advantages of various symbologies of bar coding that will be most advantageous to your company. Be sure you can generate all label requirements too. The WMS can support automated replenishments, expiration date control, shippers, and truck traffic in the yard. The system also can be configured for EDI and Internet interface, and recalls by serial and lot numbers. You can also mechanize with conveyers, "pick to light", and sortation systems.

In summary, Ed said you must understand your process and requirements. Identify your hardware and software needs. Visit working sites of the WMS you are considering. Run a pilot program. Do a cost benefit analysis and take into account intangibles. Expect a cost for data conversion and add 20% above the cost estimate for the unexpected. Be sure you buy a proven and working system, not "vapor-ware."