Understanding ERP and WMS
Understanding the differences between Warehouse Management System (WMS) and Enterprise Resource Planning (ERP) system is really important, since some of the ERP solutions have added storage functionality to their offers. It is relevant to make the appropriate decisions at the execution of the distribution chain area of a business.
The distribution centre is considered the last step of a client order, and this is where all the orders are collected, assembled, documented, notified and dispatched.
Many companies are handling additional value services at their distribution centres, from elaborating packages or core promotions, labeled, assembled, light manufacturing and several improvements for an advanced distribution centre.
Therefore, having a poor knowledge of the differences between WMS and ERP in the processes of execution of the distribution chain is really risky.
WMS offers more functionality for the inventory, storage, logistics and transport than ERP; but some of the ERP solutions are stronger in the storage operations.
Advanced System for Locating and Slotting
An advanced system for locating places evaluated different rules, parameters and configurations. It takes into account the data of the product, status, lot, dates, dimensions, location, area, region, owner and inventory details. For this function, WMS determines which would be the best location to store the recently received product. In regards to the possibility of determining the proper location, ERP has a limited participation.
The administrators of the distribution centres are often storing their inventory several times in order to shorten the time of search and to optimize the use of space. This process is called optimization of the locations assigned, or slotting. Some solutions of ERP and WMS have added a re-optimization module incorporated (in the case of ERP) and separated in WMS.
Dynamic Waiting Tasks and Work Flow Tasks
One task of the distribution centre is the collection, dispatch, reception, storage, etc. A waiting list is the pending assigned task of the distribution area.
The software gives the possibility to assign tasks automatically to the staff using rules and parameters previously defined. In this particular case, WMS offers the possibility to give directions to the workers in an intelligent and organised way, while ERP can provide it only if a separate module is added.
Regarding the workflow, this allows a configuration to indicate the tasks that a specific product needs at the moment to be dispatched or received. As an example, one product will require the tasks of collecting, assembling and dispatching, and another will also need to be quality insured.
The software will provide the users with the possibility of configuring the workflow in relation to the product level, in order to organize the tasks well and to guarantee the satisfaction of the client. The majority of the systems support this activity, but there has to be a predefined criteria to manage the task accordingly.
Employees Certificate, Transactional History and Recall
The employees receive their training and are examined to obtain their certification. This certificate will allow the staff to work with equipment and in specialized storage positions. Through WMS it will be required to have a list of the actual tasks that the employees could develop in that area, and also a list of the equipment for which the employees have already got their certification for use.
However, through other modules ERP can provide with the possibility, not only to check the availability of personnel for certain tasks, but also to make a follow-up of each employee in their activities, and also it is useful to make reports on the developing skills of each person, as well as graphics and inquiries made.
Each task made by an employee at the distribution area is registered in a database. The errors and exceptions are identified automatically, and the alerts will be sent directly to the supervisors and/or management. Both systems are capableof satisfying this need, and also will be useful for checking the movements of products in the inventory through the record of transactional distribution history.
Regarding the possibility to recall a product based on the number of lots or production codes, once again, both products will be helpful in knowing exactly where and how it was dispatched, and also to look for the lot number or serial number.
Another advantage that ERP can offer is to define the equipment of the distribution centre with concepts of limitation and authorizations for the use of the same.
MHE is a specialized equipment located in the centre of distribution that handled the products that are being moved or stored. This system is managed by commands of an external software. MHE includes AS/RS, Pick-to-light, put-to-light, classificatory and other equipment. The installations of WMS frequently act like an interface for this, and the participation of ERP is sometimes limited.
The specific functionality of each option, ERP or WMS, leads to the conclusion that there has to be an exhaustive analysis of the needs of the business and to focus on one solution based on the comply and not in the price difference, since the operative costs could be higher.
When an enterprise handles a large number of products or variety of the same product, will for sure need to automate the control of inventory in order to get an effective knowledge of the quantities of material, products in process, or products already finished and available.
The Control of Inventory Module
Another option that the users may take into account is the possibility to obtain a reduced software focused on the storage control activity, and this could be the inventory, the control of products, entry and the outcome of materials and equipment. This option allows you to satisfy a specific need of a small or medium sized company, with a lower investment.
Some of the modules offered on the market are:
* Inventory: this module helps to maintain physical inventories with the capacity to make reports sorted by date, products, inventory with pictures, inventories with locations, reorders, etc.
* Fixed Actives: to administrate or consume inventories. It allows to assign products to employees and departments and then to receive them back, giving the possibility to record or track the use of a product and the invoicing of the same. Between the reports, there is an inventory per category, per lot and per expiration date.
* Entry / Outcome: this module controls the transactions of material and equipment. It is ideal for libraries, audio and video departments, tools and files. This is a powerful tool to keep the inventory controlled in circulation. Among others, the reports include cost of rent per employee or per department, products that should have been returned or delivered, and use per number of products.
It is possible to differentiate three different types of clients of control of inventory system: the ones that need a complete ERP, the ones that will need WMS and the ones that will only need a module easy to learn and use to control their physical inventory or goods in circulation.
At the time of making a decision to improve the development of the tasks of the distribution centre area, many factors should be taken into consideration like the size of the company, the importance of the need, the budget, and the effective use that the system will have.
