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Copyright © 2000 by World Wide Technology, Inc.All Rights Reserved
“What Do You Mean I Need a Warehouse Management System?”
Juanita Logan
World Wide Technology, Inc.
Barry Brandt
World Wide Technology, Inc.
Company Overview
World Wide Technology, Inc. (WWT), a certified Sun Microsystems JAVA center and Oracle ServiceProvider (OSP), is a rapidly growing company that provides Internet-based solutions and integrationservices to customers in the federal government and commercial markets. These services include e-Businesssolutions, integration of business applications and value-added distribution. The company and its majorityowned subsidiary, Telcobuy.com, LLC, manages over 400,000 square feet of warehouse space used forlight assembly, product kitting and finished goods distribution. WWT installed Oracle Applications inMarch 1998, and upgraded to Release 11 in November 1999, to support the exponential growth in each of their markets.
Introduction
The purpose of this presentation is to highlight the differences between inventory management andwarehouse management functions and then discuss how to integrate a third party or custom warehousemanagement system with the Oracle suite of application modules.Perhaps you have never thought about the differences between inventory management and warehousemanagement functions at your company. Every company has unique and varying degrees of complexity inthe business processes required to manage the flow of their product related material, but on the whole, mostof these processes can be separated into one of these two functional areas.Both inventory and warehouse management have the same goals of increasing customer satisfaction andmarket share while reducing operating costs. Inventory management pursues these goals by managingaccurate, available material levels to satisfy customer demand. Inventory management also providesvisibility to the costs associated with the material used in a company’s operation. But if inventorymanagement is concerned with what is contained in the warehouse, warehouse management must focus onhow resources and overall capacity can be exploited to their maximum capability.More specifically, warehouse management must effectively control all warehouse operations includingreceiving processes, QA activities, locating material for storage and putting it away, satisfying requests forreplenishment, picking and staging material and then shipping the product to the customer. The twofunctional areas are very tightly related; a speedy picking and shipping process is worthless if the productisn’t available. But when the inventory management process is working properly, the additional benefits of an efficiently run warehouse can be enormous.No two warehouses operate in an identical manner. Product mixes, unique logistics requirements, skilledlabor availability and a myriad of other dynamic variables create distinctive warehouse management systemrequirements. It would be impossible to compile a complete list of requirements that would represent eachcompany’s warehouse management needs. The following is an attempt to categorize common warehousemanagement functions and provide details for some of the features that might be found in a warehousemanagement system, above and beyond traditional inventory management functions. Assuming thewarehouse management system of choice supported the logic for these features, it is important to note thatextensive amounts of additional information would need to be collected and maintained about the materials,facilities and resources involved in the warehouse management process; system integration efforts aredescribed later in this document.
 
A warehouse management system should make effective use of the warehouse space.
The warehouse management system may be able to help with put-a-way logic for material through use of fixed, overflow and/or random location assignments, utilizing flexible rules based on the item’s attributesand the current state of the warehouse locations. For example, the system could identify the storage mediumof the product, recognize hazardous or high dollar material requirements and could take into considerationsize and weight properties of the part when determining where it should be placed. Further it might utilizelogic in determining replenishment bins that need to be filled, secondary locations when primary racks arefull and available points which are geographically close to the shipping dock. On the simpler side, it mightbe sufficient just to see a list of open locations when trying to determine where material should be placed.Housekeeping features could also be included to optimize fragmented locations, prepare for a new productline or account for changes to the warehouse layout. Advanced systems would recognize patterns of historical traffic or forecasted requirements. In fact, one outcome of the system and the data required tosupport it might be to aid in the planning of future facility requirements. Overall though, the businessobjective of the system is to provide direction and visibility that will effectively increase the volume of activity and material the current facility is capable of handling.
A warehouse management system should inherently improve the accuracy of transactions that takeplace.
The use of barcode and other ID technologies may be incorporated as part numbers, revisions, quantities,serial numbers, lot/batch numbers, order numbers, customers, suppliers and locations of all types to removeerrors caused during data entry. Time sensitive information could be captured for shelf life information andFIFO type controls. Specifically, the system could print and utilize barcoded data along with other usefulinformation during vendor receipt, customer return, storage, packaging, vendor return and customershipping operations in the warehouse. The system could also translate supplier and customer unique partnumbers and information to data understood by the internal system. Also, Quality Control requirementscould be included in the receipt process to sample periodic shipments and collect quantifiable results duringtesting/inspection processes.It would be desirable to record each of these transactions via a radio frequency terminal at the location andtime where they took place; it is difficult to scan the barcode on a rack from a network terminal positionedat the other side of the warehouse. Similarly, physical inventories, replenishment counts and periodic cyclecounts could be executed efficiently and accurately by the warehouse management system using terminalslike these.This was a very condensed list of features and is probably one of the areas that vary most amongstcompanies but the benefits can be enormous. Accurate transactions in warehouses can improve businessareas associated with asset management. Accounts payable and accounts receivable would benefit as wellthrough improved receiving and shipping information. Lastly, if a company could confidently assume theirinventory information is accurate, they could dedicate time and resources towards improving lessfundamental aspects of the warehouse management function.
The time management and efficient use of other resources within the warehouse need to be managed.
Work can be balanced between resources to insure optimal utilization. Performance of resources can bemeasured against company standards to provide productivity reporting and help identify capacity issues.The system could automatically prioritize activities, placing rush order and cross docking requirementsbefore normal “put-a-ways”. One example of this would be redirecting received material directly to theshipping dock based on customer backorders or shortages improving customer satisfaction and savingwasted stocking and picking transactions.Wave picking, zone picking, order picking and many other strategies available to reduce the cycle timerequired to retrieve material from the warehouse could be incorporated into warehouse system logic.
 
Special care should also be taken to insure new or temporary resources can be introduced to the warehousemanagement system with limited training and “ramp up” time. Overall, resources could be
directed by thesystem
to improve customer satisfaction, decrease order cycle time and allow managers opportunities toimprove the process even further.
There are also a variety of specialized requirements that may have to be handled by the warehousemanagement system.
Many companies today use re-usable containers as a method of organizing and protecting material duringtransportation and storage. These containers provide additional requirements when they need to be trackedby quantity, owner, serial identifier and location. It can be even more complex when multi-part or nestedcontainers are involved. The warehouse management can help by tracking the receipt and storage of eachpiece(s), plan for effective packing of the containers when the product is ready to ship and provideinstructions on how material should be packed.Special documentation can be provided for country and government specific international shipments. Thesystem could also provide required documentation for transportation of hazardous and dangerous material.Reports like these can be very time consuming to produce and errors may create costly delays in theshipping process.Automated material handling equipment exists in numerous functions and forms. Everything fromautomated storage and retrieval systems to computer controlled conveyors and guided vehicles may haverequirements from the warehouse management system for routing, location and transaction information. Attimes these automated system can place additional functional requirements on the warehouse managementsystem as well. Providing full case quantity pick lists on a conveyor and batching orders to represent thenumber of stations at a carousel would be examples of this.
The current Oracle Application functionality must be supplemented.
It is important to note that the Oracle Application is not void of warehouse management functions. In factOracle will soon unveil its own warehouse management solution covering many of the features mentionedabove. Until then, many companies have more advanced requirements than the standard application iscapable of providing. It is in these cases that companies plan to integrate custom or third party packagesolutions to supplement the existing functionality.The remainder of this paper will take you through a practical application of an Oracle application andwarehouse management system implementation. As you will see the interface design discussed here relyheavily on Oracle open interfaces, which for the purpose of this presentation reflect the capabilities of theRelease 11 functionality.
Step One – Identify the key business requirements
Before you begin to develop the interface design, you must first identify your objectives. What are the keybusiness requirements driving the decision to integrate the Oracle applications to a warehouse managementsystem? The answer to this question can actually have a direct bearing on the design of the interface.Oftentimes, the companies want to
decrease the
 
order cycle time
in order to improve customer service. Inorder to do this, released sales orders must be fulfilled many times throughout the day. This means pick release may need to run every 30 minutes and ship confirmations may need to take place every hour. Highfrequency and/or large batches can be very demanding and the chances of making this requirement a realitywill depend heavily on both the robustness of your hardware, network and the ability of the WMS tooperate as close to real time as possible.Some businesses require
fewer picking, packing and shipping errors
. As discussed earlier, warehousemanagement systems can automate these processes through conveyor belts, carrousels, etc., thus reducing
of 00

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