Warehouse Management Training

Warehouse Management Training
Copyright © 2012 NTT DATA, Inc.

Agenda
Warehouse Management Strategies
2
Copyright © 2012 NTT DATA, Inc. 2
Putaway Strategies
Putaway Strategies
The stock placement strategy
is a procedure in the
Warehouse Management
system whereby the system
searches for a suitable
storage bin within a storage
type or a warehouse number
using a particular strategy.
3
Stock placement strategies are used to

search for an appropriate storage
bin within a storage type when
goods are to be placed into
storage.
• For each storage type, a stock
placement strategy is defined that
serves to optimize warehouse
usage and the flow of materials.
4
The system does not use a strategy to search for

a storage bin. The user enters the destination
storage bin when the transfer order is
created. This procedure is used if the search
for a storage bin is done on-site by the
warehouse worker. First the warehouse
worker searches for the appropriate storage
bin. Then the data about the storage bin (for
example, storage type and coordinates) is
entered into the transfer order.
• We recommend that you use "no strategy"
for mixed storage and interim storage types.
• Since no strategy is used, you leave the
Stock placement strategy field blank in the
storage type record.
5
With stock placement strategy “F”
(fixed bin assignment), the
system reads the fixed bin that
is defined for the storage type in
the material master record.
• If no fixed bin is defined, an
error message appears.
• Characteristics combination:

• addition to existing stock
allowed

• capacity check
6
Strategy K refers to stock placement of a material into a
storage bin NEAR the fixed bin of the material. So that
if your fixed bin is full, the system would recommend a
bin in close proximity to the fixed bin.
• Strategy K will assign a destination bin in a storage
area that serves as a goods buffer area for fixed bin
storage. Although the fixed bin storage and reserve
storage are in the same physical unit, they are defined as
different storage types.
• The same conditions must exist for both storage types.
The coordinate structure for bins in both storage types
must be the same with the same sequence. The bins
located above one another in the fixed bin storage area
and the reserve area must have the same coordinates in
the shelf and aisle areas, but different level numbers.
• You can customize so that put away is attempted first
in the fixed bin storage area, then in the reserve area.
Strategy K only searches in the reserve area and does
not check the fixed bin area.
• Search first occurs within the same stack, then right
beside the same stack, then the aisle on the opposite
side, then neighboring aisles.
7
With stock placement strategy “I”, the

system looks for a storage bin where
the material already exists.
• If the system cannot find such a bin
or if the capacity of the bin will be
exceeded, it looks for the next empty
bin.

• capacity check

• addition to existing stock allowed

• no mixed storage
8
With stock placement strategy “P”, the maximum

number of quants is defined dependent on the
bin type and storage unit type.
• The first stock placement determines how the
storage bin will be divided as well as which and
how many quants can be placed into the other
sections of the shelf.
• If you assign the same bin type and a different
storage unit type to the same section key, is also
possible for you to putaway more than one type
of pallet into the same storage bin.

• SUT check

• mixed storage
9
With stock placement strategy “C”,

the first available storage bin in
the storage section is always
proposed, unless the bin is
blocked.
• It is possible to enter another
storage bin manually.
10
With stock placement strategy “L”,

the system assigns the first
empty bin for stock placement
(random storage). This strategy
is especially suited for high rack
storage and shelf storage.
• The sort sequence of the
storage bins can be influenced
by a sort field (for example,
cross-line placement).
11
General characteristics of stock placement strategy “B”:

• customer-individual definition of storage bins (for
example, row / row block)

• definition of the capacity (stack height) based on the
storage unit type and special material characteristics
• one SUT per line
• compressed stock placement possible
• blocking for further stock placements upon first stock
removal, with automatic unblocking upon final removal
• partial quantities and mixed storage possible
• time limit for FIFO (set placement block based on time
limit)
• variable control possible via the block storage indicator
in the material master record
• addition to existing stock allowed
• SUT check
12
Steps for Stock Placements
1. GR against PO/ Others/ STO

2. Create TO for the GR stocks
3. Print the TO slip
4. Place the goods in the
respective Storage type/Bin
5. Confirm the TO
13
Stock Placement process
1. IM level Goods Receipt

happens against PO/ Others/
STO
2. In the WM level first Transfer
Requirement will create
3. Then Transfer Order will create
4. If any differences are there we
will short confirm at WM level.
5. That differences will update in
IM level
14
Planning a Movement
1. Goods Receipt happens against

PO/ Others/ STO, here Transfer
Requirements will create for
the those stocks
2. For those Transfer
Requirements we will create
Transfer Orders to place the
stocks in the respective
destination bins
15
Transfer Requirement Information
The transfer requirement contains

information about a planned
goods
movement in the warehouse. Most
planned goods movements are
requests
sent to other systems, such as the
Inventory Management system.
Here are some typical examples:
o goods receipts
o goods issues
o stock transfers
16
Palletization Notice
As per defined in the material

master data, the palletization
will show in Transfer Order
17
Transfer Order
The transfer Order is shows the

material item with source and
destination bins and quantities
18
Picking Strategies
Stock Removal Strategies
A picking strategy in the

Warehouse Management
System refers to a procedure
whereby the system searches
during a pick for a suitable
quant within a storage type or a
warehouse number.
19
A stock removal strategy is the procedure

used to search for a suitable quant for
stock removal within a storage type.
• For each storage type you define a
stock removal strategy (FIFO for
example) that serves to optimize
warehouse usage and the flow of
materials.
• You can define the stock removal
strategy Stringent FIFO to apply to
more than one storage type.
20
With this picking strategy the system proposes

the oldest quant in the storage type as the
quant that should be transferred.
• The system generally calculates the "age"
(length of time in storage) of a quant on the
basis of the goods receipt posting date from
the Inventory Management (IM) application
component. The system automatically sets
the goods receipt date in the quant and in the
transfer requirement for every goods receipt
posting in IM. When the transfer order is
created, this date is copied over to the quant
record of the destination storage bin.
• You can accept the goods receipt date that
the system sets or you can enter a different
date. Regardless of whether the system
proposes the goods receipt date or you enter
a different date, the date is used to calculate
the age of the quant. This date influences the
sorting sequence for each material.
21
For some warehouse organizations or

sectors of industry, the FIFO
principle cannot be used. For
example, in the building material
industry material that is being
stored temporarily, that is, material
that is going to be transferred
immediately out of the warehouse,
is stacked on material that is
already in the warehouse. If the
FIFO strategy is used during
picking, the material lying on top
must be moved so that the
warehouse worker can reach the
material with the oldest goods
receipt date. The LIFO strategy is
provided for such situations. When
the system searches for a quant to
remove from stock, it always
selects the last quant that was
placed into stock.
22
With stock removal strategy “A”, the system

compares the requirement quantity with the
largest bin quantity in the storage type. If the
requirement quantity is the same or larger (for
example, because an entire pallet is required),
stock is removed from this bin. If the requirement
quantity is smaller, it is removed from a pallet
with a partial quantity.
• When the system searches for a quant, it follows
these steps:
• If the required quantity in the transfer order is the
same or greater than the quantity of a standard
storage unit, the system attempts to remove a
standard storage unit from stock.
• If no standard storage units are available, partial
storage unit quantities are used.
• If the required quantity in the transfer order is
less than the quantity of the standard storage unit,
the system first tries to remove partial storage
unit quantities from the stock.
• If no partial storage unit quantities are available,
full storage units are broken.
23
With stock removal strategy “M”,

only an amount smaller than or
equal to the control quantity
defined in the material master
record can be removed from the
storage type.
• If the requirement quantity is
larger than the control quantity,
the system searches for a
quantity in the next storage type
(default vector in the storage
type search table).
24
Quantity rounding is meaningful in combination with picking strategy
“M”. If pallet quantities, carton quantities or individual quantities
are to be picked from a chain of storage types, this can be done by
defining the rounding quantity and control quantity in the material
master record.
• First, in customizing, switch on the round off quantity field at the
storage type level.
• For the first storage type of the search sequence, (pieces) enter the
number of pieces in a carton minus 1 as the control quantity. For
requirement quantities greater than or equal to a carton, the system
will skip over this storage type.
• For the second storage type of the search sequence, (cartons) enter
the pallet quantity minus 1 as the control quantity and the rounding
quantity equal to the carton quantity. For requirement quantities
greater than or equal to one pallet, the system skips this storage type
and generates transfer order items for complete carton quantities
only.
• In the third storage type, you do not enter a control quantity, but the
rounding quantity is equal to the pallet quantity. The system then
generates transfer order items for full pallets only. For remaining
quantities, the system returns to the storage type sequence and picks
from the first or second storage types.
• Note: the system does not round to zero so if there are not enough
individual pieces in the first storage type, a carton will be broken.
Also, if the requested quantity is larger than the available quantity in
a bin, it is not rounded. If a carton plus a few individual pieces are
located in a bin in the second storage type, and the requirement
quantity is greater, the bin will be emptied.
25
Picking Strategy P allows the bin from

the material master to be posted, even
if the bin has no stock quantities, thus
driving the on hand balance of the
fixed bin to a negative quantity.
• Stock Placement Strategy ‘F’
• Negative Stocks are allowed
26
For materials managed with shelf life
expiration date (SLED), the
expiration date is noted in the quant
data when the goods are received. At
that time the system checks whether
the SLED entered is allowed or not.
• By using stock removal strategy
“H”, you ensure that materials with
the fewest days remaining before the
expiration date are removed from
storage first.
• A report is also available to select
and list materials in the warehouse
that respond to a user-defined
remaining time before a given
expiration date. This is known as the
shelf life expiration date (SLED)
control list.
• For materials that are managed in
batches, the processing of materials
that are to be removed from stock
can be handled using the general
batch search task.
27
It is generally assumed that only one picking

strategy is allocated to each storage type.
However, a strategy based on the storage
type is not usable in all sectors of industry.
• In WM, it is possible to remove stock
according to the FIFO principle by taking
into account all quants within a warehouse.
In this case, the system does not scan
individual storage types in sequence but it
proposes the oldest quant in the entire
warehouse as the quant to be removed from
the warehouse. The system does not take
into account the picking strategies specified
for the individual storage types. This would
lead to inconsistencies.
• Some storage types should be excluded
from the stringent FIFO strategy, otherwise
incorrect picks would result. For example,
the interim storage area for differences
should be excluded from the stringent FIFO
strategy. The stringent FIFO strategy is set
or switched off in the table Exclusion of
storage types from Stringent FIFO.
28
Steps for Stock Removal
1. GI against delivery / Others/

STO
2. Create TO for the GI stocks
5. Confirm the TO
29
Steps for Stock Removal
1. GI against delivery / Others/

STO
2. Create TO for the GI stocks
5. Confirm the TO
30
Transfer Order for Stock Removal
1. Transfer Order will have the

information of source and
destination storage type/bin
2. The goods pick from
Warehouse respective bins to
destination shipment area
31
Transfer Order for Stock Removal
1. As per the strategy assigned to

storage type stocks will pick
from the respective storage type
and create transfer order for
those stocks
32
Thank You

Copyright © 2012 NTT DATA, Inc. This document contains confidential Company information. Do not disclose it to third parties without permission from the Company.

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Copyright © 2012 NTT DATA, Inc.

Warehouse Management Strategies

Stock placement strategies are used to

The system does not use a strategy to search for

With stock placement strategy “I”, the

With stock placement strategy “P”, the maximum

With stock placement strategy “C”,

With stock placement strategy “L”,

General characteristics of stock placement strategy “B”:

Steps for Stock Placements

1. GR against PO/ Others/ STO

Stock Placement process

1. IM level Goods Receipt

1. Goods Receipt happens against

Transfer Requirement Information

The transfer requirement contains

Here are some typical examples:

As per defined in the material

The transfer Order is shows the

A picking strategy in the

A stock removal strategy is the procedure

With this picking strategy the system proposes

For some warehouse organizations or

With stock removal strategy “A”, the system

With stock removal strategy “M”,

Picking Strategy P allows the bin from

It is generally assumed that only one picking

Steps for Stock Removal

1. GI against delivery / Others/

Steps for Stock Removal

1. GI against delivery / Others/

Transfer Order for Stock Removal

1. Transfer Order will have the

Transfer Order for Stock Removal

1. As per the strategy assigned to

Copyright © 2012 NTT DATA, Inc. 33

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