• Jim Southern

ERP or WMS "Best of Breed"

Its an age old question - Which is the best option for Warehouse Management, an add-on to ERP or a specialist WMS system? Well, you'll get different answers depending who you ask in the business, ask the Logistics and Warehouse Manager and the answer will be a dedicated "Best of Breed" WMS, ask the accountants and they will most likely say an add-on module. Why? because sometimes the warehouse is often seen as the poor relation and the value to the business of a smooth warehouse operation is underestimated or overlooked by the commercial departments.

But its a fact of modern business that an efficient warehouse operation is the beating heart of all successful businesses involved in distribution operations. In order to perform better than the competition, you need smart systems that can understand and deliver the speed and efficiency gains in the warehouse that you need to compete in the modern world.

So what are the pros and cons of either an ERP add-on or WMS? Well in general terms the ERP option will deliver less flexibility and reduced functionality but the initial investment may be more cost effective. ERP systems have been designed from the "top down" i.e. a commercial view of how the warehouse should work or "WMS for Accountants" if you will (no offence to Accountants by the way, its just that they don't work in the warehouse). The dedicated WMS solution is designed from the "bottom up" with rich and flexible functionality allowing the warehouse operations to be streamlined for maximum efficiency. The flexibility to receive, pick, pack and despatch in variety of ways which reflect the real world of modern warehouse operations.

Looking at the two scenarios the table below provides some simple pointers to see how the options measure up:

ERP Add-On Best-of-Breed WMS

Financial Transactional Focus Warehouse Operational Focus

Functionality for Simple Operations Superior and Comprehensive functionality

Light on Product Traceability Traceability is Key and Built In

Workarounds for Missing Functionality Flexible Rules Driven Functionality

Difficult to Manage Changing Priorites Dynamic and Real Time Management

Inflexible Product / Location Storage Strategy Flexible and Dynamic Location Management

Restrictive Pick & Pack Operations Enhances Pick, Pack & Shipping

(Automates manual methods) (Promotes new methods)

Many businesses assume that extending ERP into the warehouse is the easiest and cheapest option but from experience, its not been proven to be the case in many companies we've visited. You also can't assume that the warehouse ERP module integrates seamlessly with the rest of your ERP, because many add-ons have been bought in and "grafted on" to the ERP, they are not truly "fully integrated".

Take a reality check: What are the cost of the workarounds needed to compensate for the missing functionality? What is the potential impact on customer service? All too quickly you may discover that the "free" warehousing module you received with your ERP isn't really free after all!

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 #BestofBreed #ERPvWMS

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