Warehouse Management Systems – key factors to help drive change
Selecting the right warehouse management system WMS is a critical decision for any business that has warehousing and distribution operations. On the one hand, the right WMS can help businesses streamline their operations, improve efficiency, and reduce costs. On the other, the wrong system can lead to inefficiencies, mistakes, and even lost sales through lack of availability. Investing in any kind of technology that helps to drive efficiencies and boost productivity requires careful consideration. So, what are the key factors when selecting a warehouse management system?
Business needs and goals
The first step in selecting a WMS is to assess your business needs and goals. This includes understanding your current and future warehousing and distribution operations, including inventory management, order fulfilment, shipping, receiving, and returns. You should also identify any pain points, bottlenecks, or inefficiencies in your current processes that a WMS could help address.
Scalability
The WMS should be scalable to accommodate your business growth. The system should be able to handle increasing orders, inventory, and employees as your business expands. Ensure that the system has the flexibility to handle peak periods and any unexpected increases in demand. It is important, therefore, to honestly assess where your business is now and your requirements for the short-, medium- and long-term.
Integration
A WMS should be able to integrate with your existing business systems such as enterprise resource planning (ERP) systems, transportation management systems (TMS), and customer relationship management (CRM) systems. Integration can improve data accuracy and streamline operations. Your warehouse management system is a multi-year investment so should be compatible with a wide range of integrations. Your WMS should not become a barrier to which transport provider or ERP you can use in the future – ensuring that you can choose services that are right for your business.
Ease of use
The WMS should be user-friendly and easy to learn. The system should also have an interface that allows users to see and understand the data clearly. Think about your reporting requirements and understand the capabilities of the WMS’ that you are considering – understand how to extract the required data from the system.
Customisation
Every business has unique needs and requirements, and the WMS should be customisable to meet those needs. Customisation can include custom reports, workflows, and dashboards. Considering if your needs can be met via configuration rather than requiring bespoke coding is always preferrable. With that being said, WMS systems have evolved with features that are designed to meet the needs of most potential clients. So, if a bespoke customisation is required, it is worth reflecting on ‘why’ and if your own processes should be reviewed and changed to align with industry standards.
Technology and mobile capabilities
The days of operatives walking around warehouses with picking lists on pieces of paper should be consigned to the past – while some businesses still do operate in this analogue way, most warehouse transactions are now completed utilising barcode scanning technology. Accuracy, speed and traceability are the primary benefits of this. When considering a WMS, even as a start-up business, mobile stock-keeping capabilities should be prioritised. Allowing employees to access the system through smartphones and tablets can improve efficiency and provide real-time information.
As businesses scale up, enterprise level WMS systems are designed to work in tandem with automation to provide additional efficiency. Predictive tools and machine learning are also becoming increasingly common place, assisting companies to optimise stockholding, as well as product flow through the warehouse and transport routes.
Implementation/onboarding, support and training
Depending upon the scale and complexity of the implementation or change, project management support of an appropriate level should be agreed with the provider to ensure a smooth onboarding.
The WMS provider should offer support and training to ensure the successful implementation of the system. Training should include both end-user training and administrative training.Identifying the right candidates within your business to lead, participate in the implementation, and to rollout training to their peers is key to ensuring a smooth transition.
Cost
The cost of the WMS should be within the budget of the business. The total cost of the system should consider the software licence (annual fees structure), hardware, implementation, training, and ongoing support and maintenance. Many WMS licencing plans are scalable – for example, the number of users or total number of transactions so it can provide value and scalability as the needs of a business change. The duration and structure of agreements offered can also vary. Some system providers offer month-to-month subscriptions, while others provide incentives for longer licenses. As such, make sure you explore all options when procuring your WMS.
Selecting the right WMS is a critical decision for businesses involved in warehousing and distribution operations. To make the best decision, businesses should assess their needs, consider scalability, integration, ease of use, customisation, mobile capabilities, support and training, and cost. By carefully evaluating all these factors, businesses can choose the right WMS that will help them streamline operations, improve efficiency, and reduce costs.
Martin Hodgkins is a manager in the Supply Chain & Logistics Advisory Services team at BDO LLP – the accountancy and business advisory firm.
