Team SCM has chosen to use SAP Supply Chain Management Systems. The Supply Chain Management systems through SAP create value for firms that require planning, tracking and supplying products to customers. According to Forbes Tech, SAP is the top Supply Chain Management software system in the world.1 Due to the extensive list of solutions that SAP supplies to firms, we have chosen to narrow our selection to Warehouse Management Solutions (WMS). Statistics show that 48 % of customer order cycle times have been decreased through SAP’s automated picking, packing and shipping.2
Purpose:
The primary intended purpose of the SAP WMS system is to provide firms with flexible, automated support for the movement of all products, as well as managing warehouse inventory. According to SAP’s website, “the system supports scheduled and efficient processing of all logistics processes within your warehouse.”3
Functionalities:
WMS functions by managing quality, safety, automation and inventory in end-to-end process optimization combined with state-of-the-art analytics. Supply chain management and quality control are directly impacted by each other. It is imperative to integrate quality within the supply chain at the beginning, during and at the end of a product’s factory life. Poor quality control can lead to damaged or worn products. Firms also have the responsibility of keeping workers and customers safe. Through SAP’s WMS, firms can monitor day-to-day functions to ensure the safety of everyone involved. Another primary function of the WMS is automation. Automation entails the use of machines, control systems and information technologies to optimize productivity and profit. Automation is a big selling point to firms that are looking to find IT systems to increase profit and value. The last key function the WMS gives is inventory optimization. Managing the relationship between customer and vendor is an important part of supply chain management. The activity involved in managing the relationships directly correlates with the purchase transfer or management of inventory. The analytical features provided by SAP’s WMS will improve the management of inventory.
Features:
- Inbound/outbound Processing - Inbound processing is used to process and prepare incoming orders for efficient putaway and storage optimization. Outbound processing is used for task management, packing, shipping, and load building to simplify distribution and optimize outbound orders.
- Integrated Labeling - A feature that enables the software to integrate and optimize with different print technologies like barcode, RFID/UID, impact, and laser labels.
- Storage Optimization - A system used to improve storage strategy by integrating, virtualizing, optimizing, and managing the products in your warehouse.
- Picking/Packing Automation - Automating the process of removing product or materials from the inbound location and transporting them to the storage area. Then moving the lot to the staging area and to the appropriate location for identification and kitting and/or outbound processing.
- Kitting Support - A feature that allows the software to support the light assembly of components that are pre-defined into assembly groups. Gallaugher mentions Amazon’s relationship with the vendors to get chairs in prepackaged, ready-to-ship boxes. The prepacked, ready-to-ship boxes keep the product available to customers while cleaving costs. SAP uses the same strategies; the only difference is the IT systems.4
- Labor Management - labor management solutions are designed to reduce labor costs through employee performance reviews against predefined standards.
- Cross-dock Planning - A feature used to manage the transportation of materials between different trucks to increase efficiency through consolidating loads without intermediate storage. Cross docking is a method of distribution where materials are not put away, but rather inbound shipments are prepared for their next location and synchronized with outbound shipments to drastically reduce distribution and storage costs.
Other features relate to SAP are Warehouse KPI Reports, Multiple Warehouse Support, Virtual Yard for Off Site Equipment. All definitions can be found in reference 5.
SAP and Heinz Corporation
SAP WMS system will be helpful to Heinz Corporation because it provides firms the means to simplify formalities and time. Heinz Corporation’s Supply Chain department need the support of a system like SAP WMS. Heinz Corporation plans and executes both inbound and outbound transportation processes; while also automating processes through SAP. The Warehouse Management Solutions permits Heinz to create personalized orders for clients by storing the products in a efficient way. From creating the order to delivering the product to the customer, SAP WMS has the tools to make it happen. Image 1 shows a Heinz purchase order: 6
Image 1
When the product is received in the Heinz warehouse, the product is processed through Warehouse Management Solutions (directly to inventory). That inventory is controlled through SAP’s Warehouse Management Solutions, as we can see in image 2:
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SAP can give Heinz analytical, logistical systems to check the warehouse inventory overview. WMS shows products in stock, how many are available and how many are ready for customer transaction completion. Image 3 shows the inventory of products that are controlled by SAP’s WMS systems.7
References
- http://www.forbes.com/sites/louiscolumbus/2015/05/18/gartner-supply-chain-management-market-share-update-sap-dominates-with-25-8-share/
- http://go.sap.com/docs/download/2014/11/40b2ca58-0e7c-0010-82c7-eda71af511fa.pdf
- http://help.sap.com/saphelp_erp60_sp/helpdata/en/c6/f85c504afa11d182b90000e829fbfe/frameset.htm
- Gallaugher, J. (2014). Information systems: A manger's guide to harnessing technology (2.0). Washington, DC: Flat World Knowledge.
- http://supply-chain-management.softwareinsider.com/l/32/SAP-ERP
- http://wiki.scn.sap.com/wiki/pages/viewpage.action?pageId=235801782
- http://prospettiva.co.uk/newsite/wp-content/uploads/2014/07/SAP-B1-Available-to-promise.jpg
