By Nadia Khan on Januari 4, 2014, Arabiansupplychain.com
The regional market for Warehouse Management Systems (WMS) has been enjoying healthy growth, echoing that of the Middle East’s fast-recovering logistics industry. Analysts suggest that the WMS industry is set to grow at around 13 percent this year alone. And as logistics operators continue to compete for business, the need for more streamlined and efficient warehousing operations has never been greater.
According to industry experts, persuading today’s companies of the enormous benefits of WMS relies upon an appreciation of the changing requirements of warehouse operations. This has led to an emerging drive towards ‘real time’ visibility, and accurate inventory management, and optimisations to cope with faster goods movement throughout the supply chain. Barcode scanning, RFID, advance location assignment and pick workflow optimisation now appear as standard functions within any WMS worth its price. The use of Cloud-based systems is another recent development, aiming to bring the systems within the reach of the end user community, and enabling better integration with other parts of the supply chain.
As a regional supply chain solutions provider, SPAN has been implementing one of the most popular WMS in the region, Infor WMS, since 1996. “Such an advanced WMS solution is all about optimisation, cost saving and cost tracking,” explains Kamel El-Ghossaini, regional manager for supply chain solutions at the SPAN group. The major differentiator of such a Tier one product, he explains, lies ‘under the hood’. “WMS vendors of all sizes claim to support advanced WMS functionality, but the major difference between a Tier one and the other WMS vendors is the flexibility and scalability of the functionality offered,” says El-Ghossaini. “The Infor WMS is used by eight out of ten of the top 10 3PLs globally, mainly for its flexibility in responding to customer requirements and its ability to support their growth.”
SPAN has found that the system’s popularity extends beyond the Middle East, and has led to many successful implementations across Europe, Russia, Africa, and the US. In recent times, Infor WMS has piled on new features including a Facility Viewer enabling customers to have a graphical view of the facility layout; Voice Recognition; Advanced Labour Management module; and Advanced Reporting and KPIs. Although some companies may hesitate at its price tag, El-Ghossaini is adamant that a high quality WMS remains a key component for overall warehouse cost-effectiveness. “Today’s customers need their WMS to be a cost saving solution,” he explains. “A Tier one WMS allows them to optimise their warehouse operation and customer service and, at the same time, reduce operating cost.” To achieve this, El-Ghossaini advises customers to prioritise working with a local partner who can implement a top-tier WMS solution whilst providing the capacity to support the product locally. “All these technologies have been introduced to help companies improve their warehouse optimisation by reducing cost and increasing service level,” he says.
As general manager at the Storage & Handling Solutions Division of FAMCO, David Dronfield agrees that a modern distribution centre cannot function efficiently without a ‘best in class’ WMS. The decision to invest is an important one. “Maximum efficiency can only be gained via WMS, not a spread sheet,” he says. “Balancing the investment costs for a WMS against the long-term operational gains requires financial aptitude, demonstrating both tangible and non-tangible savings to justify the cost for ‘best’ service.”
Dronfield maintains that a good WMS system, implemented correctly and managed professionally, will ensure improved customer service and impact bottom line results, minimising operational inefficiencies. But to provide this best value for money, the WMS has to deliver on several fronts. “The WMS must manage and ensure the flow of materials and information throughout the distribution centre via optimisation of the available space and resources,” says Dronfield. “It must also have the ability to integrate effectively with transport management, yard management and labour management, and align with the associated operations within the warehouse.”
FAMCO itself uses the full capabilities of the SAP R3 Warehouse Module for the control and management of units, with the parts inventory control software delivered via SYNCRON Global Inventory Management, with data interface to SAP. “All demand planning and forecasting is performed in SYNCRON, with vendor orders created in SAP,” says Dronfield. “This setup particularly suits our business operations involving automotive parts.” As FAMCO expands in the region, SAP is being rolled out across the operations, with all parts supply-managed via SYNCRON at the UAE head office.
Within the primary operations such as receiving, put-away, picking and shipping, Dronfield adds that an efficient WMS has to manage the flow of information from advanced shipping notices across appointed carriers, through to order despatch with manifest. “A good WMS with well-managed profiling ensures regular alerts to available improvements in product slotting, thus maintaining maximum opportunity for efficient order picking,” he says. “Prior to put-away, the WMS should be checking current order opportunities for possible cross dock to ensure order fill rates are maximised and back orders minimised.”
But the WMS wishlist does not end there. Muthanna Muckatira, GM middle east of Ehrhardt + Partner Solutions (EPS), says the modern WMS has to be modular and not only manage, but actively guide day-to-day operations and provide complete transparency. “The modular warehouse management system should be used across various industries and be designed for both simple and more demanding requirements,” he says. “The standard system, supported by a relational database, must control the entire material and information flow in logistics centre by means of dialogue- supported applications.”
EPS’s own product range in the Middle East includes the leading warehouse management system Logistics Focused Solutions (LFS) 7. “With LFS as a standard system for warehouse management, we continually set new standards for warehouse logistics and manage the usual challenges and streamline operations,” says Muckatira. But, as he is quick to point out, even a top-tier WMS is by no means the magic key to success when it comes to turning around poor warehouse management. “It’s not enough to bring in efficient WMS without a drastic change in the mind-set of the clients, to accept and move forward with the best practices recommended by the solution providers,” says Muckatira. “To have a successful implementation, the solutions need to be adapted to suit the local working conditions, with education and training of the end users playing a major role.”
Some questions need to be asked even before a WMS can be selected. “The vendor needs to question whether the system provides the right solution for its specific business requirement, whether it is scalable as per on-going business growth,” says Muckatira. “There are many other factors to take into consideration as well, such as whether the system offers seamless integration and can work across various ERP systems?” The responses to these questions should indicate which WMS will be the best fit for a particular warehousing operation.
Electronics retailer Jumbo has been using an EPS supplied LFS system to manage its warehouses in Jebel Ali, Abu Dhabi, Oman, Qatar and Bahrain. “Logistics is a huge operation and must be efficient so that it facilitates sales from the back end,” says Shailen Shukla, head of logistics at Jumbo Electronics. “LFS is a fully-automated system which hugely minimises our paper and printing costs.” As one of the largest distributors of Sony products in the world, Jumbo has 24 retail stores and nine service centres across the UAE, with a growing distribution and retail presence in Oman, Qatar, Bahrain and Kuwait. “From the outset, we have been working diligently to provide our warehouses with a seamlessly integrated logistics operation,” says Shukla. “We strive to ensure that the business runs like clockwork, and does so with optimal efficiency, by using the latest techniques and best practices.”
For 3PL service providers, the need for an efficient WMS that delivers cost-savings is even more essential. As Wael Mabsout, senior manager at SNS points out, today’s logistics providers are often faced with complex environments of operations, requiring a solution that is highly configurable without having to customise for every new client. “Unlike mature markets, where 3PLs are able to impose their standards on customers who often abide by them even in their own facilities, here every customer wants things done their way. This means they need a WMS that can generate the charges to their customers and require constant support and training on features as they move from one implementation to the other,” he says.
To overcome these challenges, it is imperative that a WMS solution supports the warehouse operator to manage and control their operations from the time of receiving products to the time of shipping them. “By using real-time system update via Radio Frequency devices, you can know exactly what is happening at all times, you know who did what and you can ensure minimum data entry errors,” explains Mabsout. “This helps to increase inventory accuracy, improve the morale of your labour force, and all-in-all reduce operating costs.” Often, companies will invest in new facilities, believing themselves to be running out of warehousing space, whereas they are simply not using their capacity to its full potential. “When you put a WMS in place, you have more visibility on your operations and can realise when you are stocking more than you should,” says Mabsout.
Like SPAN, SNS has been promoting the Infor WMS solution in the region. Mabsout believes that the choice of implementation partner is almost as important as the choice of WMS. “There may be certain advanced features of a particular WMS that you would look for, depending on the complexity of your operations, but these features are not what you would base your decision on. Our approaches to these projects make our success; we do not implement a software solution but a warehousing solution.”
Indeed, simply having a top-tier WMS in place does not ensure that warehousing operations will run much more efficiently or cost-effectively. Like EPS’s Muckatira, Mabsout maintains that when companies implement a WMS solution, they must recognise the need to change the way they do things. “We see many customers that use the WMS as a data entry system, and they don’t implement the features that optimise storage or increase their performance,” he says. “They would rather keep their operations and ask for the solution to be configured or customised to fit their setup.”