Warehouse Management System (WMS)

A warehouse management system (WMS) is software and processes that allow

organizations to control and administer warehouse operations from the time goods or
materials enter a warehouse until they move out. Operations in a warehouse include
inventory management, picking processes and auditing.
For example, a WMS can provide visibility into an organization's inventory at any
time and location, whether in a facility or in transit. It can also manage supply chain
operations from the manufacturer or wholesaler to the warehouse, then to a retailer
or distribution center. A WMS is often used alongside or integrated with a
transportation management system (TMS) or an inventory management system.

Types of warehouse management systems

Warehouse management systems come in a variety of types and implementation
methods, and the type typically depends on the size and nature of the organization.
They can be stand-alone systems or modules in a larger enterprise resource
planning (ERP) system or supply chain execution suite.

They can also vary widely in complexity. Some small organizations may use a simple
series of hard copy documents or spreadsheet files, but most larger organizations --
from small to medium-sized businesses (SMBs) to enterprise companies -- use
complex WMS software. Some WMS setups are designed specifically for the size of
the organization, and many vendors have versions of WMS products that can scale
to different organizational sizes. Some organizations build their own WMS from
scratch, but it's more common to implement a WMS from an established vendor.

A WMS can also be designed or configured for the organization's specific

requirements; for example, an e-commerce vendor might use a WMS that has
different functions than a brick-and-mortar retailer. Additionally, a WMS may also be
designed or configured specifically for the types of goods the organization sells; for
example, a sporting goods retailer would have different requirements than a grocery
chain.

Warehouse management system benefits

Although a WMS is complex and expensive to implement and run, organizations gain
benefits that can justify the complexity and costs.

Implementing a WMS can help an organization reduce labor costs, improve

inventory accuracy, improve flexibility and responsiveness, decrease errors in
picking and shipping goods, and improve customer service. Modern warehouse
management systems operate with real-time data, allowing the organization to
manage the most current information on activities like orders, shipments, receipts
and any movement of goods.

Features of warehouse management systems

Many features are common to WMS products, including the following:

Warehouse design, which enables organizations to customize workflow and

picking logic to make sure that the warehouse is designed for optimized
inventory allocation. The WMS establishes bin slotting that maximizes storage
space and accounts for variances in seasonal inventory.

Inventory tracking, which enables the use of advanced tracking systems,

including radio-frequency identification (RFID), automatic identification and
data capture (AIDC) and barcode scanners to make sure that goods can be
found easily when they need to move.

Receiving and putaway, which allows inventory putaway and retrieval, often
with pick-to-light or pick-to-voice technology to help warehouse workers locate
goods.

Picking and packing goods, including zone picking, wave picking and batch
picking. Warehouse workers can also use lot zoning and task interleaving
functions to guide the pick-and-pack tasks in the most efficient way.

Shipping, which enables the WMS to send bills-of-lading (B/L) ahead of the
shipment, generate packing lists and invoices for the shipment and send
advance shipment notifications to recipients.

Labor management, which helps warehouse managers monitor workers'

performance by using key performance indicators (KPIs) that indicate workers
who perform above or below standards.

Yard and dock management, which assists truck drivers coming into a
warehouse to find the right loading docks. A more complex use of yard and
dock management enables cross-docking.
 Reporting, which helps managers analyze the performance of warehouse
operations and find areas to improve.

WMS and IoT

Connected devices and sensors in products and materials help organizations to
ensure they can produce and ship the right quantity of goods at the right price to the
right place at the right time. All of these features fall under the internet of things (IoT).
Such IoT data can integrate into a WMS to help manage routing of the products from
the pick-up point to the end point. This integration enables organizations to develop
pull-based supply chains, rather than push-based supply chains. Pull-based supply
chains are driven by customer demand, which allows the organization more flexibility
and responsiveness, while a push-based supply chain is driven by long-term
projections of customer demand.

Top WMS vendors

A variety of software vendors sell warehouse management systems. IBM, Microsoft,

Oracle and SAP have WMS products or modules in comprehensive ERP suites.
Other prominent WMS software vendors include Aptean, Basware, Epicor,
HighJump, Infor, JDA Software, Manhattan Associates, Rootstock Software (which
acquired Kenandy in January 2018) and Sage.
Transportation Management
System (TMS)
A transportation management system (TMS) is a subset of supply chain
management (SCM) that deals with the planning, execution and optimization of the
physical movements of goods. In simpler terms, it's a logistics platform that enables
users to manage and optimize the daily operations of their transportation fleets.

TMS is offered as a module within enterprise resource planning (ERP) and SCM
suites and helps organizations move inbound -- procurement -- and outbound --
shipment -- freight using tools such as route planning and optimization, load building,
operations execution, freight audit and payment, yard management, order visibility,
and carrier management. The ultimate goals of using a TMS are to improve shipping
efficiency, reduce costs, gain real-time supply chain visibility and enhance customer
service.

Typically, TMS serves both shippers and logistics service providers. Manufacturers,
distributors, e-commerce organizations, wholesalers, retailers and third-party
logistics (3PL) companies are some of the major users of TMS software.

TMS has gained traction over the past decade, as it has emerged as an enabler of
seamless global trade and logistics management. By enabling information exchange
across functional silos; amid geographically disparate operations; and in various
languages, currencies, and business units, it has developed into an enterprise
software that is finding growing appeal. Furthermore, its functionalities make it
suitable for organizations that not only have complex logistics operations, but also
those that may have basic transportation needs.

Given the factors above, a 2016 Gartner report predicted that the global TMS market
will grow at a compound rate of 6.95% and reach $1.72 billion by 2019, up from
$1.23 billion in 2014.

Benefits of TMS

A fully deployed transportation management system can benefit organizations in the

following ways:

Transportation order planning and execution. TMS integrates well with

enterprise order management, warehouse management and purchasing
systems, customer relationship management (CRM), supplier relationship
management (SRM), and other systems for managing transport demand. It
enables users to plan and manage both international and domestic shipments
and determines the cheapest and most efficient carrier and mode using better
route planning, load optimization, carrier mix and mode selection.
 Supply chain visibility and better control of inventory management. TMS
enables users to track and monitor the lifecycle of orders and shipments in
real time and get status updates on each. This offers users an accurate
forecast for the inventory and improves the visibility and accountability of the
supply chain network.

Reduce invoice errors. By automating the freight payment and audit

processes, users can reduce errors that may arise from manual procedures.

Transport intelligence. Most TMS software offers users extensive insights

and reporting capabilities that provide them with detailed visibility into freight
data and metrics to help pinpoint any discrepancies. With this data, users can
make the necessary changes to improve service delivery and reduce cost,
and they can also create reports.

Transportation management systems can exist either on premises or in the cloud,

often as SaaS.

Though organizations generally prefer TMS in the cloud due to the increasing use of
connected devices, a traditional on-premises deployment is sometimes still preferred
by large manufacturing and distribution firms that may have higher security
requirements and want day-to-day control of TMS servers.

TMS software providers

Although TMS is commonly offered as a part of ERP or SCM platforms from large
vendors, there are also sellers that exclusively provide specialized, stand-alone TMS
products

Additionally, there are TMS service vendors that provide not just the technology, but
also services to the shippers to run their daily transportation operations. In this
arrangement, however, shippers retain control over the key relationships between
carriers and customers.

Oracle, SAP and Infor/GT Nexus are leading vendors that offer TMS software,
among a broad range of other enterprise applications. Other notable vendors include
TMC, JDA Software, Manhattan Associates, Inet, BluJay Solutions -- resulting from
Kewill's acquisition of LeanLogistics in 2016 -- MercuryGate and Transplace.
Inventory Management
Inventory management is the supervision of non-capitalized assets (inventory) and
stock items.

A component of supply chain management, inventory management supervises the

flow of goods from manufacturers to warehouses and from these facilities to point of
sale. A key function of inventory management is to keep a detailed record of each
new or returned product as it enters or leaves a warehouse or point of sale.

The inventory management process

Inventory management is a complex process, particularly for larger organizations,

but the basics are essentially the same regardless of the organization's size or type.
In inventory management, goods are delivered into the receiving area of a
warehouse in the form of raw materials or components and are put into stock areas
or shelves.

Compared to larger organizations with more physical space, in smaller companies,

the goods may go directly to the stock area instead of a receiving location, and if the
business is a wholesale distributor, the goods may be finished products rather than
raw materials or components. The goods are then pulled from the stock areas and
moved to production facilities where they are made into finished goods. The finished
goods may be returned to stock areas where they are held prior to shipment, or they
may be shipped directly to customers.

Inventory management uses a variety of data to keep track of the goods as they
move through the process, including lot numbers, serial numbers, cost of goods,
quantity of goods and the dates when they move through the process.

Inventory management software systems

Inventory management software systems generally began as simple spreadsheets

that tracked the quantities of goods in a warehouse, but have become more
complex. Inventory management software can now go several layers deep and
integrate with accounting and ERP systems. The systems keep track of goods in
inventory, sometimes across several warehouse locations. The software also
calculates the costs -- often in multiple currencies -- so that accounting systems
always have an accurate assessment of the value of the goods.

Some inventory management software systems are designed for large enterprises,
and they may be heavily customized for the particular requirements of those
organizations. Large systems were traditionally run on premises, but are now also
deployed in public cloud, private cloud and hybrid cloud environments. Small and
midsize companies typically don't need such complex and costly systems, and they
often rely on stand-alone inventory management products, generally through SaaS
applications.

Inventory management techniques

Inventory management uses several methodologies to keep the right amount of

goods on hand to fulfill customer demand and operate profitably. This task is
particularly complex when organizations need to deal with thousands of stock-
keeping units (SKUs) that can span multiple warehouses. The methodologies
include:

Stock review, which is the simplest inventory management methodology and

is generally more appealing to smaller businesses. Stock review involves a
regular analysis of stock on hand versus projected future needs. It primarily
uses manual effort, although there can be automated stock review to define a
minimum stock level that then enables regular inventory inspections and
reordering of supplies to meet the minimum levels. Stock review can provide a
measure of control over the inventory management process, but it can be
labor-intensive and prone to errors.

Just-in-time (JIT) methodology, in which products arrive as they are ordered

by customers, and which is based on analyzing customer behavior. This
approach involves researching buying patterns, seasonal demand and
location-based factors that present an accurate picture of what goods are
needed at certain times and places. The advantage of JIT is that customer
demand can be met without needing to keep quantities of products on hand,
but the risks include misreading the market demand or having distribution
problems with suppliers, which can lead to out-of-stock issues.

ABC analysis methodology, which classifies inventory into three categories

that represent the inventory values and cost significance of the goods.
Category A represents high-value and low-quantity goods, category B
represents moderate-value and moderate-quantity goods, and category C
represents low-value and high-quantity goods. Each category can be
managed separately by an inventory management system, and it's
important to know which items are the best sellers in order to keep
quantities of buffer stock on hand. For example, more expensive
category A items may take longer to sell, but they may not need to be kept in
large quantities. One of the advantages of ABC analysis is that it provides
better control over high-value goods, but a disadvantage is that it can require
a considerable amount of resources to continually analyze the inventory levels
of all the categories.
Inventory control is the area of inventory management that is concerned with
minimizing the total cost of inventory, while maximizing the ability to provide
customers with products in a timely manner. In some countries, the two terms are
used as synonyms.
ERP (Enterprise Resource
Planning)
ERP, or enterprise resource planning, is a modular software system designed to
integrate the main functional areas of an organization's business processes into a
unified system.

An ERP system includes core software components, often called modules, that focus
on essential business areas such as finance and accounting, HR, production and
materials management, customer relationship management (CRM), and supply
chain management. Organizations choose which core modules to use based on
which are most important to their particular business.

What primarily distinguishes ERP software from stand-alone targeted software --

which many vendors and industry analysts refer to as best-of-breed solutions -- is a
common central database from which the various ERP software modules access
information, some of which is shared with the other modules involved in a given
business process. This means that companies using ERP are largely saved from
having to make double entries to update information because the system shares the
data, in turn enabling greater accuracy and collaboration between the organization's
departments.

Some ERP systems also offer next-generation capabilities, such as AI, IoT and
advanced analytics, to foster digital transformation. Businesses typically turn to an
ERP system when they outgrow spreadsheets and disparate, often siloed software
systems and need the unifying capabilities of an ERP system to enable growth. As
with many technology products, the specific definition of what constitutes ERP can
vary widely from vendor to vendor.

Benefits of ERP systems

ERP offers a plethora of benefits, most of which come from information sharing and
standardization. Because ERP components can share data more easily than
disparate systems, they can make cross-departmental business processes easier to
manage on a daily basis. They can also enable better insights from data, especially
with the newer technologies that many ERP systems are including, such as powerful
analytics, machine learning and industrial IoT capabilities.

In addition, ERP software:

● boosts efficiencies by automating data collection;

● enables business growth by managing increasingly complex business
processes;
● helps lower risk by enabling better compliance;
 ● fosters collaboration using data sharing and integrated information;
● provides better business intelligence and customer service capabilities;
and
● improves supply chain management.

Advantages and disadvantages

Many consider ERP software to be a requirement for enterprises -- especially for

core business functions such as finance -- and the same is arguably true for growing
SMBs. The sheer volume of data that companies generate, along with the complexity
of the global business landscape and modern consumer demands, has made
streamlining business processes and managing and optimizing data increasingly
critical. An ERP software system is typically at the core of such capabilities.

That said, there are advantages and disadvantages to implementing ERP.

Advantages:

● Can save money over the long run by streamlining processes.

● Provides a unified system that can lower IT-related expenses and end-
user training costs.
● Enables greater visibility into myriad areas of the business, such as
inventory, that are critical for meeting customer needs.
● Enables better reporting and planning due to better data.
● Offers better compliance and data security, along with improved data,
backup and the ability to control user rights.

Disadvantages:

● Can have a high upfront cost.

● Can be difficult to implement.
● Requires change management during and after implementation.
● Basic, core ERP modules may be less sophisticated compared to
targeted, stand-alone software. Companies may require additional
modules for more control and better management of specific areas, such
as the supply chain or customer relationship capabilities.
ERP implementations: On-premises ERP vs. cloud ERP vs. hybrid ERP

Legacy ERP systems tend to be architected as large, complex, homogeneous

systems that do not lend themselves easily to a cloud service delivery model. As
such, most ERP systems, particularly those from large legacy vendors, are run on
premises.

The deployment of a new ERP system in-house can involve considerable business
process re-engineering, employee retraining and back-end support for database
integration, data analytics and ad hoc reporting.

However, for a number of reasons, an ever-increasing number of companies are

moving to cloud ERP, especially SaaS and hybrid ERP -- where part of the ERP
software suite runs on premises and part runs in the cloud. Cloud-based ERP
modules are built to be loosely coupled, which can reduce the cost and complexity of
a deployment. Because cloud ERP does not require the hardware and infrastructure
necessary for on-premises implementations, it can save on costs, both in terms of
the technology purchases required and the IT staff required to manage it. Cloud ERP
may also be more efficient with automatic upgrades and easier scaling.

Perhaps most importantly, ERP vendors have focused on their cloud products to
enable powerful data processing capabilities, IoT, machine learning, blockchain,
advanced analytics, 3D printing, and other new and emerging technologies that can
help companies achieve digital transformation and better compete in the changing
global marketplace.

Some companies are reluctant to put mission-critical systems and applications in the
cloud for a variety of reasons, including perceived security risks or loss of data
control. Other companies in highly regulated industries or government agencies may
be restricted by where systems and data is located geographically. In addition,
on-premises ERP provides greater customization options, which can be
important.

ERP vendors

There are many ERP vendors with a wide variety of functions and on-premises or
cloud deployment options.

The most widely deployed legacy platforms are SAP, Oracle and Microsoft
Dynamics, all of which have multiple ERP brands and on-premises and cloud
deployment options. Their customers range from large enterprises to SMBs.
Other leading vendors include Epicor Software Corp., Infor, IFS World, Sage
Software Inc., Syspro USA, IQMS and QAD Inc. Leading cloud ERP vendors include
NetSuite Inc., Kenandy Inc., Acumatica Inc. and Plex.

Many of the smaller ERP vendors offer software that handles common business
processes, as well as functions that focus on specific industries like manufacturing,
retail, healthcare or the public sector.
References
https://en.wikipedia.org/wiki/Warehouse_management_system

https://en.wikipedia.org/wiki/Transportation_management_system

https://www.oracle.com/ca-en/applications/supply-chain-
management/solutions/logistics/warehouse-management/what-is-warehouse-
management.html

https://www.oracle.com/ca-en/applications/supply-chain-
management/solutions/logistics/transportation-management.html

https://www.supplychain247.com/article/what_is_a_transportation_management_sys
tem

https://en.wikipedia.org/wiki/System_integration

https://blog.capterra.com/what-is-an-inventory-management-system/

https://en.wikipedia.org/wiki/Inventory_management_software

https://www.investopedia.com/terms/i/inventory-management.asp

https://www.oracle.com/ca-en/applications/erp/what-is-erp.html

https://dynamics.microsoft.com/en-ca/erp/what-is-erp/