• Jim Southern

WMS and ERP - Whats the Real Difference?



Its a common question when invited to discuss how a WMS system can benefit a business. I already have an ERP system (Sage, Microsoft or other) which we use to manage inventory and issue pick lists to the warehouse guys, why do I need WMS? Well, the difference is that all ERP and Business Systems have evolved from accounts and ledgers software. Let's take Sage as a classic example, it is fantastic for the accountants and admin staff to keep track of who's ordered what and whether they have paid the bills etc. but in terms of the warehouse operation it is quite weak in terms of automation.

The only option for the warehouse staff is to print out paper pick notes, manually manage the physical picking of the items and then key it back into Sage. Very time consuming, tedious and prone to errors. So to summarise, ERP has evolved from the office down.

WMS systems on the other hand have evolved from the warehouse up. That is to say they are solely concerned with the "operational" aspects of running an efficient warehouse. What happens at the "coal-face" is just as important as what happens in the upstairs office when it comes to efficient and accurate pick, pack and delivery of the customers order. I often describe it as "Upstairs Downstairs" i.e. the downstairs staff (warehouse) need an operational system to drive efficiencies and the upstairs staff need a commercial system to manage customer orders and financial controls. They are different animals entirely.

An analogy for you: Running a warehouse operation using paperwork could be compared to managing your accounts with quill pens and those thick ledgers of yesteryear. The warehouse is often overlooked when it comes to smart systems and yet it is essentially the engine room of all businesses that are involved in distribution from modern ecommerce to own product manufacture or pure fulfillment.

Of course, its most important to have a strong ERP system to manage the commercial aspects of the business, thats a given, but we see the warehouse as equally important in terms of delivery and fulfillment of those hard won orders. Having a lot of orders on the books is a fantastic situation but if you can't deliver promptly or accurately to your customer, they will soon go elsewhere. This is where a strong WMS solution enhances and compliments ERP and Accounting. Directed picking, packing with guided verification ensures you get the order out on-time every time and keep the customers happy. In todays competitive markets it is essential that your customer service tips the balance in your favour.

The ERP Way

Most ERP systems provide the business with a high level overview of warehouse operations, as well as the basic elements of inventory control, i.e. how much stock is in the warehouse to commit, paperwork pick notes and manual updating of what’s been picked and discrepancies, usually updated the next day. Many find that the traditional ERP approach to managing warehouse operations is out of date and in many cases paper-based.

The Dexterity Way

Dexterity WMS software is designed to help you streamline all the warehouse operations from inbound receipts, putaway to location, order picking, packing & despatch. Know where every item of stock is in the warehouse and the status of every customer order to ensure on-time delivery. Optimise stock location strategies in the warehouse to make sure stock is always available for fast, efficient & accurate order picking.

We have a wealth of experience in implementing our specialist Dexterity WMS Systems to help clients realise the benefits of a smart Warehouse Management System. Please get in touch for a no obligation and no pressure discussion on how Dexterity WMS could help your business.

#ERP #WhatisWMS

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