An efficient warehouse maximizes its space use, streamlines operational functions, and increases employee productivity. A Warehouse Management System (WMS) standardizes and manages the four-wall activities and inventory management. When a warehouse is efficient, customers receive their orders on time, and the company's costs are in-line with management’s financial plan.
Below are nine major ways a WMS improves operations efficiency.
1. Productivity Tracking
One of the major benefits to WMS is the ability to track all activities, labor functions and inventory location and use.
As English scientist Lord Kelvin said, “If you can’t measure something, you can’t improve upon it”. At the heart of this thought is the ability to track, measure and then improve processes, inventory locations and quantity and labor use.
Tracking gives insight into where problems may lie within a facility or set of processes. It can allow for trends to be seen and allow for visibility into what changes help throughput or hurt it.
A WMS that utilizes scanning and job functions that employees can log into can accurately report on many different levels what is happening operationally. A WMS can take the data collected and create many different reports or dashboards needed to make decisions and see improvement.
2. Inventory Control
A WMS offers many features that help to control the inventory and the attributes associated with it. Without inventory control, all other processes cannot operate optimally, thus making it a very important facet of any WMS. Some of the main control functions include:
- Lot tracking
- Expiration tracking
- Cycle counting
- Recommended location moves based on velocity or replenishment frequency
- FIFO/LIFO/FEFO
- Task interleaving
- Bin consolidation
- Inventory audit trails by product and history of storage locations; and locations and product storage history. By transaction, date/time stamped and employee ID.
All of these features help to ensure that counts, relevant dates, and other important information are all accurately tied to the product in order to drive downstream functions.
3. Labor Management System
Direct and indirect labor is generally more than half of the total cost of fulfillment excluding transportation. A Labor Management System (LMS), or module, works in conjunction with the WMS. The LMS tracks and reports on all activity of the employees and is fed data from the WMS.It has very specific job functions for all direct and indirect activities that someone could potentially perform. For some systems, all of the time record keeping and pay calculations are resident and performed within the LMS. An LMS is also required for advanced productivity tracking, oftentimes utilizing KPIs and engineered labor standards.
4. Slotting
Slotting is the process of strategically placing items in the right sized locations that are in the correct location physically within a facility and/or pick path. Without a WMS, slotting is typically not a function performed and if it is, it is performed in a much more manual process. Without slotting routines, there are different issues that can arise. The issues that can arise are:
- Too many replenishments from too small of a location
- Months of sales stored in a forward pick location
- Slow movers in the “golden zone”
- Too big of footprint and too long of a pick path increasing picker travel time and cost.
By having efficient slotting routines, you can ensure:
- Correct sized locations for each product
- Correct placement of products location
- Golden zone for fast movers reducing pick labor
- Accurately size the pick footprint
A WMS provides velocity sales reports and can recommend logical product moves or swaps based on user input criteria. Ideally forward picking locations should have at least 5 days’ worth of demand to reduce the frequency of replenishment.
5. Batching Logic
Order picking is typically one of the operations major expenses. Without batching logic from a WMS, picking only one order at a time, or discreet picking, is typically the only viable option. Discreet order picking is time consuming by traversing the same aisles multiple times for only one order each time.
By batching orders together, and picking multiple orders in one pass, time is saved on picking. One popular batching logic option is cart bin picking. It allows you to pick multiple orders during a single pass through the pick path. A WMS can provide many different batching logic options including:
- All single line orders
- Cart bin batch picking
- Zone based picking options
6. Directed Put-Away
Without directed put-away, open (available) locations are searched out manually within an aisle or facility. Time is wasted riding or walking around aisles looking for empty locations. There is also the possibility for product to be put-away in the incorrect zone, aisle or put-away in a location that cannot physically handle the weight of the product.
Directed put-away can eliminate the manual search and can ensure the correct location is used to put the product away in. Increased bin utilization, by consolidating less than full pallet product locations at time of put-away, can also be gained.
If there is accurate product cube data, it will not recommend an empty location that is too small. Using user input criteria, the WMS will only recommend correct aisles and zones that product should go into.
7. Scanning and Barcoding
Manual paper-based operations have considerable errors, higher costs and lack on-line, real time capture of data for inquiries and tracking. With barcode scanning as the method of data capture for the facility, product and operations, WMS will streamline and eliminate paper, achieving 99.98% accuracy and make data available for on-line functions. A WMS can offer different types of barcodes, like GS1-128, that can incorporate lot codes and expiration dates in a single scan.
8. Replenishment Logic
Replenishing locations without a WMS is typically based on visual checks and mandatory replenishments when a picker identifies insufficient product during a pick run. Dealing with this process interrupts the picker and causes unscheduled replenishment to be performed.
Replenishment logic in a WMS will save time and decrease errors. Errors in replenishment can lead to “warehouse backorders” when the picker cannot locate the product. A WMS can utilize user inputted min/max or cube data to determine when a location should be replenished and the quantity to replenish.
A WMS can also alert forklift operators to replenish a location to not interrupt the picking of orders that have been dropped to the floor.
9. Advanced Dimensioning Logic
For businesses that have detailed weights and measures for their products, cartonization logic within a WMS can provide several benefits. It should be said cartonization is not effective for 100% of all orders. However, suggested carton sizes for outbound orders is a main benefit of this. Either pickers can pick straight to the required carton to eliminate packing; or packers are told which box to use, speeding up the thought process of which carton size to use. This also helps with outbound transportation spend by reducing dimensional weight.
Summary
Implementing a WMS can help your operation become more efficient, reduce error rates and improve customer service. It is difficult to be efficient without WMS as it is a foundation for improving efficiency.
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