Selection of a Warehouse Management System External or Integrated Solutions?

It is the “million dollar question”, says Patti Satterfield, marketing manager of the internationally active logistics group Fortna Inc.

Almost every company looking for a suitable warehouse management system (WMS) has to find the answer to it.

On the one hand there are systems that are part of an ERP package and that allow integration with the enterprise resource planning system of the respective producer.

The best-known example is the software produced by the SAP Group in Walldorf, Germany.

The group produces its own modules for warehouse management; WM in the standard system and EWM for additional requirements.

On the other hand, there are many producers that have built up specific know-how and that have developed a WMS.

One of the most common system is the warehouse management system LFS developed by Ehrhardt + Partner in Boppard-Buchholz, Germany.

Both solutions have their advantages that have to be taken into consideration when selecting a warehouse management system.

The first task is to find out if an integrated or an external WMS will bring greater benefits.

In a structured decision-making process tailored to the company’s needs, the requirements have to be examined first.

When the complexity of the project is low, installing the logistics module of an ERP system that is already being used can be sufficient. In order to be able to correctly assess the situation, the importance of item availability and delivery reliability has to be identified.

In addition, the connection between the corporate objectives and logistics has to be taken into consideration.

Cost savings by minimizing stocks might be incompatible with a delivery guarantee or the security of supply.

• Which customer requirements have to be fulfilled and how can this be achieved within the frame of warehouse management?
• Do the storage and picking strategies need to be changed?
• How important is process flexibility - as far as it can be estimated - for the present and the future?
• To which extent and in which areas are interruptions of the logistics chain acceptable and where do they have to be avoided under all circumstances?

A high complexity of logistics usually appears in distribution-oriented companies and increases simultaneously with the throughput of goods and the item variety.

When the analysis shows that the logistic processes are complex, the decision between an additional module of an ERP producer and a software solution developed by logistics experts like for example LFS produced by Ehrhardt + Partner has to be made.

The objective is to find the product that controls the logistic structures and processes in the best way.

Hasty decisions should be avoided, because the optimal solution has to be found.