Make the investment in WMS to a great success

As I have written in previous articles, for an efficient and successful warehouse you need two very important things. First, is leadership and a strong organization the second thing is good and competent WMS, a tool that many companies invest a lot of money in but few make use of their full potential.

I will not go into details what supplier of WMS to choose, but the fact is that, the more and larger customers a WMS supplier have, the more likely that the system has more and valuable features. It is simple; Customers with constant need for more cost-effective logistics drive suppliers of WMS to develop the system constantly with new smart features. The small and medium-sized businesses free riding on the big company’s logistics development. In my opinion, it is worth investing in an established WMS with large customers globally. The big customers often make smart customizations of the systems, which become standard features in future, releases. Smaller WMS customers take advantage of these features when they upgrade.

Still I meet colleagues responsible for large warehouses that has chosen a small and unknown WMS brand, often they invested in WMS at same time with an investment in an automation solution and the provider of automation want the customer to use a specific (small) WMS because it is tailor-made with the automation solution. However, in my opinion that kind of decision can be a bad solution for the future development. In short term you have a working solution but when it is time to adapt your warehouse to new demands you can´t just do an upgrade you need to develop all the features from scratch and that is very expensive. A good comparison is with operating systems for computers, no PC brand develop their own operating system. It is too expensive to have the resources developing continuously. You don´t have any synergy effects. Development costs are financed by only one customer/user

Another common scenario that I have seen several times, a company decides to buy a WMS and the process starts with the company sends out a RFQ to a number of WMS suppliers. The project team evaluates what is the right system for your logistics and takes into account a number of factors such as price and future support. Some companies choose to take help of external consultants in the procurement and implementation phase. Too often competence from the warehouse is excluded in the selection process. The warehouse is unfortunately often involved too late when the choice of WMS is done and it is time for implementation. There is a risk of pitfalls or missing warehouse processes, in worst case you have to make big changes at the last minute. I have seen cases where senior management together with the IT department purchases a too simple WMS. If they had involved the warehouse in an early stage that could be avoided. Senior management have simply underestimated the complexity of their own logistics. It will be a costly experience because the logistics must be adapted to the system instead of the system adapted to the logistics. Often it ends with loss of efficiency and staff become frustrated when the new system is illogical and difficult to work in.

In the implementation phase, the customer’s IT department and the supplier’s application consultants should scale down the number of features in WMS to a minimum to make the implementation and go live as painless as possible. The warehouse should be engaged in the testing phase and the go live.

A common experience is unfortunately that one month or so after go live when the WMS is up and running, WMS supplier take back their consultants and terminates the project. The customer’s IT department is happy as long as there is no disruption to servers and network, they do not immerse themselves in the actual capabilities of the WMS for it is not their responsibility.

The big question is what happens next? Too often, nothing happens, the Company’s Board of Directors are frustrated for the ROI calculation was a failure. The management and staff at the warehouse are frustrated, warehouse processes take much longer (processes have been adapted to the WMS and not vice versa). I have often encountered the above scenario when I visited colleagues. They have not understood it is now the challenge begins. The companies I visit blaming a bad WMS but the truth is that the WMS provider quickly left you in search of new customers and your business now lacks the expertise to take the WMS and warehouse to the next level. Responsibility for acquiring knowledge about the system is the customer’s.

If you are aware of the challenges it entails implementing a WMS, you should proactively seek and recruit resources with expertise in the WMS you buy. Someone who understand your specific logistics and can see opportunities among all the system’s features and use the relevant functions in your warehouse and your processes. The challenge is to identify all the time thieves among processes and identify opportunities to reduce these with those features available in the WMS. Almost every warehouse that implement a WMS becomes for a time less effective than before implementation. A major challenge is to make that period as short as possible. You start from scratch, and must learn your warehouse from the beginning. It is important you do not underestimate the time to be as effective and time efficient than before implementation. It takes patience and it is important that senior management is aware of this and take height for this in the budgetary targets. Therefore it is very smart to recruit skills (or purchase consulting hours), which has expertise in your WMS, you reduce the period with lower efficiency.

You should train super users that will have a support function, train other staff, and do some optimizations in the warehouse using the WMS. It is also important to establish strong relationships with application consultants from the WMS provider that can assist your warehouse over a period in the beginning.

Another thing I noticed when I visited colleagues in the industry is that the IT department expects to provide knowledge of WMS and those logistics functions available in the system. It is completely wrong, the IT department should only operate the servers and infrastructure as well as IT hardware in the warehouse. Logistics Expertise in the system should be available in the warehouse, if the company has a logistics development department they should have expertise in WMS.

A strong and established leadership in the warehouse is also a major success factor to regain and increase efficiency after an implementation of WMS. Staff will find their own solutions in the WMS (even if they are wrong) often you can make a process in several ways, even if only one way is correct and most efficient. It is very important to be clear and communicative. Processes and methods are changing and revalued after the other. It is also important to be responsive and listen to feedback from the staff. They use the system daily. The staff have the best knowledge of how the system works out in the warehouse. Make sure to use the skills.

To get the most out of your WMS and warehouse the warehouse manager and the supervisors needs to have knowledge in WMS. It is not enough to be a good leader in today’s warehouse operations you must also have certain technical skills also. The management may not be superusers but you must be able to keep up with the development process and have an interest in development work.

It is an advantage if you put together an optimization group of representatives from management and warehouse personnel who are super users and maybe an application consultant from the WMS supplier. Optimization group’s task is to find potential efficiency opportunities and to see whether it is possible to implement in the warehouse.

With the right expertise and the right resources, an investment in WMS become a great success. Together with good leadership, it will have a great impact on the efficiency and quality of the warehouse.

2 thoughts on “Make the investment in WMS to a great success

  1. Good insights and it rings a bell to me.
    Prior to embarking on such project, a solid task team is needed. IT can take lead but people from SCM logistics must be deeply involved from start to end as clear process owners. In most cases, IT guys are been tasked to take lead but they do have not have much operational knowledge n it’s unfair to blame them for any issues/ failures. Hands holding/Tech support by the vendor is needed from start till official project closure. There’s a costs here and it must be clearly discussed by the procurement people at the front end. Penalty clause could be incorporated with the vendor at the RFQ/ RFP stages. My 2 cents..,

    Liked by 1 person

  2. This is a prudent article. REC’s focus has been on WMS for distribution centers since 1979. The efficiency obtained from a well designed systems certainly outweighs the investment which can be surprisingly cost effective and newer equipment is energy efficient.


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