October 2005 | Commentary | IT Matters

Do You Need WMS Best Practices? 10 Telltale Signs

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Most supply chain managers can share more horror stories than Stephen King. When you have to deal with demanding customers (aren't they all?), and super-tight shipment schedules, every so often things are bound to get a little dicey.

But if you've reached the point where just looking at your warehouse sends chills down your spine, perhaps it's time to consider a different way to manage your supply chain.

Fortunately, new modular warehouse software applications provide many practical and easy options for implementing successful management strategies and practices. How can you determine if your warehouse is a prime candidate for adopting today's effective Warehouse Management System (WMS) best practices?

With apologies to David Letterman, here's a top 10 list of telltale signs that indicate you could use some help, not to mention a few laughs.

10. Your receiving area is so backed up, you haven't seen the dock floor since the turn of the century.

If you have Electronic Data Interchange capabilities, Advanced Shipment Notifications (ASNs) provide a simple solution that can reduce the receiving effort by 70 percent. ASNs allow you to work more closely with trusted vendors and eliminate the need for detail receiving, such as labeling, counting, and sorting.

Even without ASNs, a WMS can help sort receipts for putaway and determine their most efficient travel path.

9. It takes you so long to put product away that you've composed a new theme song—"The Fill Rate Blues."

Putaway often is not seen as an urgent priority. Neglecting this function, however, can result in lower fill rates, congestion in the aisles, and picking obstructions. A WMS will prioritize hot receipts—those that need to be immediately replenished or crossdocked—and help you monitor and manage zone congestion.

8. Your order selection methods are so convoluted you're thinking about hiring an MIT rocket scientist to run the allocation process.

You have many options for picking orders—wave picking, batch picking, pick and pack, pick and consolidate, discrete order picking. It's best to keep this process simple by reducing the number of selection methods you use and working on a regular schedule.

Also, allocate a few large waves instead of many small ones. For larger groups of orders, a warehouse management system can select the right assignment size and group orders to optimize the pick paths.

7. Your warehouse is so full, you've set up an overflow storage area in the cafeteria, where employees use full pallets as lunch tables.

A WMS can apply storage and picking strategies to reorganize your warehouse and free up space. It also will identify opportunities to consolidate product.

6. Product demand and velocity change so often your only recourse for slotting product is an Ouija board.

Try to store high-velocity items in prime locations first, but pick from non-prime locations to clear stock out of these areas. Do the opposite for low-velocity items.

Some WMS solutions enable you to adapt to changing product demands through re-slotting—moving product to optimal locations, for example—as part of normal picking/putaway processes.

5. Your picking productivity is so low you're considering benchmarking this as a reverse logistics operation.

Picking is the most labor-intensive warehouse activity and managing its flow is of the utmost importance. To improve picking productivity, make sure the product is ready to be picked and use a WMS to slot product based on ergonomics and demand/velocity.

A WMS also can minimize travel time, and establish and monitor key performance metrics.

4. Products are handled so many times in your warehouse that they should be labeled "used."

Look for ways to streamline, simplify, and eliminate steps that do not add value. Mapping your processes is a great way to identify unnecessary activities. Over time, small, incremental improvements can make a big difference.

3. You're considering buying turbocharged forklifts to meet replenishment deadlines.

When possible, stock one day's worth of inventory in forward-pick locations. A WMS can help you prioritize replenishment tasks, avoid fit problems, and employ the correct replenishment model—whether real-time, allocation-based, or scheduled—by zone.

Also, make sure your thresholds are on target to avoid excessive replenishments.

2. Your inventory auditors have become so fanatical about accuracy they want you to cycle the contents of your lunchroom vending machines.

Ensuring accuracy on the front end of the process will reduce your dependence on cycle counts to reduce errors. Standardize your accuracy reporting, and take advantage of the exceptionally high accuracy rates of your WMS to persuade your auditors to agree to more reasonable inventory counting requirements.

1. In your facility, WMS stands for Where's My Stuff?

Warehouse management doesn't have to be a recurring nightmare. With the advanced capabilities of today's warehouse software, you have numerous options for improving productivity and gaining better control of your operations.

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