With logistics towards the future, thanks to the right IT links.
The demands on logistics are changing due to the constant changes in technology. Not only within logistics today a multitude of new technologies are used, but also the logistic environment is in a constant technological change.
Today’s customer of a logistic service wants to be able to call up current information about the products at any time and anywhere. Whoever thinks that this phenomenon is limited to the B2C sector, which has been growing strongly in recent years, may be mistaken. Also the B2B sector is currently under great pressure to develop along new technologies towards more transparency for the customer.
In order to meet these customer requirements, it is essential to make the available information available at all times and across the entire IT system hierarchy. The existing IT landscape and the warehouse management software used play a central role in the collection and transmission of this information.
Hierarchy of a “state oft the art” IT system landscape
If you are dealing with the optimization of the IT system landscape in the logistics environment, you should first know the common levels, the IT system landscape used in warehouse logistics. The levels / instances are arranged hierarchically and exchange information with each other in a targeted manner. They thus form a common IT network.
The top level — the administrative level — is responsible for the strategic and operational planning of resources in the company. Here, in addition to production planning, order processing also takes place on the basis of customer information using an Enterprise Resource Planning System [ERP system]. The administrative level controls the subordinate levels and thus acts as HOST. Therefore it is also called HOST or HOST level.
On the second level — also called client or control level — commands and inputs of the administrative level (HOST level) are executed and corresponding status reports are reported back. This is where the warehouse management system (WMS) is located. The client or control level has a commanding function for the subordinate levels.
The sub-client level or material flow level is located below the client level. This is where the additional functions of the WMS run. In most cases, this level is an integral part of the higher-level WMS and is provided by the same provider.
The fourth and last level comprises the hardware relevant for all goods movements on the control level. The degree of automation depends on the individual requirements of the company’s logistics.
Is your IT system landscape structured similarly? Compare yours and build it up according to the “state of the art” model.
The path to a homogeneous IT system landscape
Since IT system landscapes have often grown historically, a homogenization of the entire logistics IT should be considered prior to the introduction of logistics software.
First, the existing IT system landscape, as well as all existing links between individual systems, should be recorded across all levels. With a graphic representation including a description of all interfaces as well as functions of the individual systems, a good overview can be created. System versions and system manufacturers should also be included and evaluated according to their support times and operating and maintenance costs.
We recommend that the same system manufacturers and system versions are used at the same level. This reduces interfaces and above all costs.
In summary: Analyze and describe your IT landscape. Graphically depict the actual situation. Define your future IT landscape, as homogeneously as possible in terms of system manufacturers and system versions. Determine the GAP between ACTUAL and TARGET and derive your measures for implementation from this.
Process mapping & requirements definition of your logistics IT
New process requirements due to company growth and the associated higher goods and material throughput in logistics are classic reasons why companies are looking to optimize logistics IT. A structured approach is important in IT optimization. For example, if you want to introduce a new warehouse management system, you should first record and document your logistics processes. These can be influenced by the use of new systems, so that an adjustment must be made. As a recommendation: we map processes within the process documentation, for example in the BPMN 2.0 standard.
Which logistics processes are to be considered specifically here? The focus should be on the regular logistics processes from goods receipt to goods issue, including labeling, transport, storage and picking. Special processes such as inventory, transport (from and to the customer) or customer billing should also be considered in the process recording. Take a holistic view including all adjacent logistics processes.
After the process documentation is completed, the requirements for the new logistics software are defined. The recorded processes as well as the techniques used in logistics such as “pick by voice”, “pick by light”, corresponding forklift control systems or warehouse automation serve as a basis to define your target state or the IT requirements. A more established procedure for the elaboration of the IT requirements / target processes is the execution of process workshops. Due to our long experience we are happy to support you in the holistic process survey, the process workshops as well as the creation of the process specification sheet.
Evaluation of a warehouse management system — supplier selection
Which is the right warehouse management software for the individual company purposes?
The pre-defined system requirements form the basis for creating a selection list of possible system suppliers. Research different system suppliers on the market and create a bidder list. Once the bidder list has been created, initial contact should be made with the system suppliers with the aim of officially including them in the bidding process. The tender can now be prepared. During the tendering procedure, there are several points to consider in order to choose the best possible supplier. In addition to complete tender documents, such as a detailed description of the requirements, the schedule, the cost calculation template — here a uniform template should be created to facilitate the evaluation of the bids, we recommend that appropriate on-site inspections be carried out with the potential system suppliers. On the one hand, a first acquaintance takes place, on the other hand, the offer quality and accuracy can be improved. After the offers of the system suppliers have been received, the evaluation of the offers begins.
Tender evaluation and supplier selection
On the basis of the prepared tender documents and on-site inspections with the potential system suppliers, qualitatively good offers can now be expected from the suppliers. The deadline for the submission of the offer should be absolutely determined. After receipt of the tender documents, a first pre-selection can now be made. This includes criteria such as “punctual submission” or “completeness of the offers”. In the second step, the services and costs of the offers are compared and evaluated. In the end, 3–5 system suppliers should be available for the decision phase.
In the next step, we recommend that reference visits be made in which the suppliers present their warehouse management software. A good preparation for the appointment with an appropriate questionnaire should be assumed.
Before the final decision is made, the contractual framework conditions must be examined more closely. In addition to the initial costs, ongoing service and maintenance costs must be considered. In general, the entire contract management is a very important project phase in which a decision is made about long-term cooperation.
Our experience has shown that “going it alone”, lack of expertise, coupled with false ambition, is often not a good way to successfully implement a software. External support is recommended.
Advantages of a warehouse management software
What are the reasons for using a warehouse management software?
A logistics without an appropriate warehouse management system can certainly (still) function, but the risks should be considered. A manually managed warehouse depends heavily on the operating employees, who have internalized the processes as well as the exact storage locations of the goods. But what happens if employees suddenly leave the company? Strongly increasing access times, untraceable goods or unclear goods availability and the associated risk of a delivery bottleneck, to name just a few possible effects.
A warehouse management system offers clear documentation and administration of the warehouse locations and articles as well as the warehouse processes. In addition to warehouse and inventory management, scanners can be used for paperless management or for system-guided inventory, for example. The connection of automated or partially automated warehouse systems can also be considered.
Conclusion: The implementation of a warehouse management software offers a variety of possibilities for companies to optimize their own processes and workflows, which will ultimately be rewarded with economic success.
How can a warehouse management software be integrated into your warehouse?
Basically it should not matter whether you need a warehouse management system for small warehouses with manual processes or a system for highly automated solutions. Most system suppliers offer a flexible and component-based system. Due to the modular design, the warehouse system is freely scalable and can grow with increasing requirements. As an operator, you have various configuration and individualization options at your disposal. When adapting the system, always make sure that the changes are carefully documented. A well planned test and release management is indispensable. Involve the system supplier from the beginning and build up your own qualified test team.
As an alternative to the modular structure, there are so-called individually programmed systems, in which the functions are programmed customer-specific and almost from scratch. Here, there are almost no limits to the functions, but this is associated with a very high programming effort and thus high costs.
Conclusion: We recommend a modular and component-based system solution. Standardized interfaces ensure easier integration into your system landscape. In addition, the initial and running costs are much more transparent.
Which interfaces are necessary to the warehouse management software?
The use of a warehouse management software (WMS) is indispensable when it comes to an optimal control and management of stocks and storage locations within the distribution center. The WMS forms the interface between the ERP system and, as far as conveyor technology or other automation techniques are available, the material flow computer (MFR). The ERP system transfers customer orders to the warehouse management of the distribution center. The warehouse management, which coordinates the flow of goods, sets the material flow computer in motion, which triggers transport orders for the respective goods from storage area to storage area.
Most of the warehouse management systems are equipped with additional functionalities such as yard, dock, customs or transport management, thus providing a fully integrated solution. However, if these systems already exist in your own IT landscape and are not to be replaced, they can usually be connected to the WMS via an interface without any problems. Ultimately, the functionality of a WMS can be expanded individually and as needed, regardless of whether it is an integrated or non-integrated solution.
Change management — an essential part of the WMS implementation
After having reported in our BLOG series “IT system landscape in the logistics environment” on the general structure of an IT system landscape as well as on integration possibilities, interfaces and implementation of a warehouse management software, we would like to conclude by talking about change management. The implementation of new strategies, structures, systems, processes or behaviors requires far-reaching changes within an organization. A change process is anything but convenient. It is always provided by fear of the future, uncertainty and skepticism among your Personal. All the more reason why coordinated change management is becoming an essential success factor. Prepare your Personal in advance for your new activities, tasks and processes. With the appropriate transparency, the acceptance of your employees will improve. In addition, you should not do without the necessary expertise of your employees during the entire project/implementation phase. Let your employees be a part of the entire change process. You are glad to talk to us. Together we will prepare you and your employees for the new environment.
If you have decided on the implementation of a warehouse management software, we recommend to consider the following steps (in short form)
- Provide resources / project team
- Coordinated change management — timely involvement of your employees
- Define system requirements / conduct process workshops
- Tender Management
- System/supplier selection
- Execution of corresponding detail process workshops along all processes of the process specification / creation of specifications
- Create an overall schedule for the implementation
- Create training plans / train employees
- CR and release management / planning and execution of system tests
- Commissioning preparation, implementation and Go Live
- Consider stabilization phase (approx. 3–6 months)