WMS IN THE MANAGEMENT OF WAREHOUSES, WAREHOUSES AND DISTRIBUTION CENTERS

Nowadays, with an increasingly competitive business environment, information technology, when well used, becomes a strong differentiator among companies in the pursuit of excellence in customer service. As a result, more and more companies are looking for alternatives to facilitate the management of their activities, with a view to increasing control and obtaining accurate information that can actually speed up decision-making and, consequently, improve the level of service provided.

The evolution of information technology has been transforming operations management and logistics. Examples include the use of bar codes, EDI (Electronic Data Interchange), RFID (Radio Frequency Identification) and Fleet Tracking with GPS (Global Positioning System) Technology. All these technologies not only serve to increase the speed of information flow, but also to improve the accuracy of the information.

Occasionally, in the specific case of warehouses, warehouses and large distribution centers (DC), management systems known as WMS (Warehouse Management System) can be considered a good alternative to optimize storage activity, as they seek ways to optimize spaces and organize the flow and distribution of products.

The WMS is a warehouse and/or DC management system that optimizes all operational (material flow) and administrative (information flow) activities within the storage process, including activities such as: receiving, inspection, addressing, storage, if -stopping, packing, loading, shipping, document issuance and inventory control.

The WMS arose from the need to improve the flow of information and materials within a warehouse, warehouse or DC, with the main results being cost reduction, improvement in operation and an increase in the level of service provided to customers (Figure 1 ). The optimization provided by the WMS allows for an increase in the accuracy of stock information, the speed and quality of DC operations and the productivity of personnel and equipment. This has become possible due to the emergence of new information technologies in both hardware and software.

Warehouse management systems come from the evolution of the old warehouse control systems or Warehouse Control Systems (WCS). Some additional functions were added as the WCS evolved from a simple control system to a more complex system, capable of issuing suggestions or performing calculations.

Until the mid-1970s, the WCS only had the ability to control incoming and outgoing stock transactions and the respective write-off of such movements against orders from suppliers and customers. From then on, the first addressing control systems appeared, which began to be concerned with the location of the product at an “address” in the warehouse or DC. This evolution allowed the products to no longer have fixed locations and started to be stored in different areas of the DCs according to availability, and with that it was possible to increase the storage density.

The main difference between WMS and WCS is that the latter is not a warehouse manager, thus differing from WMS in some respects. WCS does not offer a variety of reports to help manage activities; lacks hardware flexibility; customization is limited to changing fields and names and its installation cannot be done in a modular way, only integrally. The counterpart of all these negative aspects is that it offers excellent monitoring and control of activities (if limited to control) with reduced cost of software and hardware required for its implementation.
WMS BENEFITS

One of the benefits generated by the WMS is the optimization of space in the storage area. One of the functions of the system is to suggest the best place to store a given product when it is received, thus preventing the operator from going through the entire DC in search of an available place to store it.

A WMS enables operational optimization by increasing productivity, optimizing spaces and improving the use of resources (handling and storage equipment). These benefits are due to the following points, as presented in Banzato (1998):

• Operational Control (the WMS provides the tasks to be done);
• Reduction of time lost with waiting;
• Reduction of dead time of movement resources;
• Optimization of the order picking route;
• Optimized storage through a location by the turning ABC curve;
• Increased stocking density, reducing distances to be covered.

Another benefit associated with the WMS is the online availability of the actual quantity in stock. Working in real time, a WMS can support reductions in lead times for both order processing and inventory management. These benefits, in turn, can provide a better level of customer service and faster inventory turns, thus being able to translate into financial savings for DC operations.

In the current competitive environment, companies have been working with smaller batches, higher frequency of orders and the need for shorter delivery times, factors that cause increases in logistical costs, forcing those responsible for warehouses and DCs to seek process solutions that increase the productivity of the warehouse's personnel and equipment (see diagram shown in Figure 2).

The WMS, through its task management and the possibility of working with automated handling equipment, can provide a great reduction in personnel costs, since it reduces the need for equipment for the same number of movements, in comparison with traditional systems.

Some authors point out that, in ERP (Enterprise Resource Planning) systems, the WMS is one of the many modules already available on the market, whose main objective is to manage the flow of information, through the control of positions, lot and FIFO rule, among other functionalities. . By having a WMS combined with an ERP, the possibility of exchanging data between them is greater. This avoids rework, such as updating records. However, for other authors, the WMS is an analytical application that is not necessarily part of the ERP (transactional system), therefore being a software that can be sold separately.

Regardless of whether or not it is an ERP module, the WMS can optimize a company's business by reducing costs and improving customer service, and its integration with ERP systems is strongly recommended. Cost reduction is associated with improving the efficiency of all operational resources, such as equipment and labor. On the other hand, the improvement in customer service can be attributed to the fact that picking and delivery errors and failures are minimized, as well as streamlining the entire customer service process, combining material flow improvements with flow improvements. of information. Figure 3 presents a summary of the main benefits presented by the WMS.
FEATURES AND FUNCTIONALITIES OF A WMS

Table 1 presents not only characteristics and functionalities related to the five basic activities performed in a DC (receiving, handling, storage, picking and dispatch), but also some activities that were added to the initial scope of a warehouse control system thanks to the evolution of technology. Thus, Table 1 briefly and directly illustrates some of the main characteristics and functionalities of a WMS.

Characteristics and functionalities 3, 6, 9, 11, 13, 22 and 28 mentioned in Table 1 exemplify the evolution of storage systems and demonstrate, in practice, the transformation of WCS systems (controllers) into WMS systems (managers).
THE PROCESS OF IMPLEMENTING A WMS

The successful implementation of a WMS and its integration with other systems already implemented in a company are usually related to the objectives expected by senior management. In general, these goals are:

• Reduction in the stock level;
• Improvement in the level of customer service due to the real knowledge of what is available in stock;
• Better use of physical space.

For these goals to be achieved, there are two critical success factors. Are they:

• Commitment and explicit support from senior management;
• Use of the organizational structure appropriate to the culture and situation at the time.

The project has two major stages: the implementation process (or general design) and the implementation itself.

The implementation process, or general conception, aims to coordinate all the activities to be developed, in addition to the allocation of personnel, availability of equipment and project control activities. This step consists of system configuration, in which we have the parameterization of all applications, whether operational and/or configuration ones, and must be performed based on real data from the CD that will be parameterized.

Thus, it is necessary to collect all the specific data from the DC so that the objectives of this phase are achieved within the deadlines established in the defined project schedule. In order for this information to portray reality in the most adequate way possible, it is necessary to involve employees, especially someone from the IT area, so that all existing information can be extracted from current systems and thus avoid rework; it is also interesting the participation of someone linked to the operational area to support the system parameterization decisions, where and how to store.

During the implementation process, it is essential that the project implementation team makes several visits to the warehouse or DC, so that the necessary data can be collected to ensure that all information migrated and/or entered into the new system is correct. As an example, several times it is necessary to measure and weigh some materials. This is because the WMS system performs several calculations using the cubage and weight of the products to issue storage suggestions.

In general, during the implementation process there are seven major groups of activities, which are:

• Warehouse-specific data collection

As previously exposed, for the WMS system to be able to issue suggestions consistent with reality, it is necessary to ensure that all input data are correct. It is then essential to carry out a survey of all the data necessary to carry out the configuration of the system. This step can be considered the most important and its main data and definitions are:

1 - The floor plan of the warehouses with their real dimensions;

2 – Existing locations, areas and/or regions for storage, removal and replenishment;

3 – The dimensions of the places for defining the capacities;

4 – The characteristics of each location, area or region of the warehouse, such as, for example, luminosity or humidity;

5 – The maximum capacities of each location;

6 – The definition of the measurement units and conversions to be used;

7 – The characteristics of the items to be stored;

8 – The dimensions and weights of the items to be stored;

9 – The definition of the profile of each location1;

10 – The definition of the profile of each item2;

11 - The entry and exit operations of the warehouse;

12 – The survey of the real needs of reports for the management of the warehouse.

• Interface Identification

All interfaces with the other ERP modules involved (such as TMS, Purchasing, Accounts Payable, Accounts Receivable, among others) or independent systems must be identified at this stage so that the measures regarding integration can be taken by the groups responsible for the interfaces. In addition to identification, this phase is also responsible for creating these interfaces.

• Parameterization of the Modules or Systems Involved

The ERP modules or other information systems that somehow interface with the WMS may need some type of parameterization so that all integrations and functionalities are met. This step consists of performing all the necessary parameterizations and interfaces for everything to work.

• Performing integrated tests for modeling parameterized systems

Once the parameters have been set, the group responsible for the project must start the phase of integrated tests, where process “bottlenecks” and possible system “BUGs” must be identified. These must be informed to the software suppliers so that solutions are sought and the corrections of the problems are executed.

Through these tests, it is possible to detect whether any product or location has not been parameterized correctly (weight or measurements).

• Definition of menus and profile of each user

It is often not in the company's interest for a branch to have access, for example, to another branch's stock; to establish this “restriction” in the system, profiles are created for each business unit. Therefore, this phase consists of creating the menus for each area in each branch/factory, identifying the users and the profile of each one so that security in the system is established.

• Definition of Reports

Users must know all needs related to reports, whether managerial or operational, identifying the necessary changes in existing and supplied models, as well as the need to create new reports. However, any report to be changed or developed must be presented and approved by all people involved in the process. It should be noted that most of these software have pre-defined report templates. Even so, in some cases it is still necessary to develop some type of specific report.

• Standardization and documentation

Standardization and documentation are intended to serve as a source of consultation and guidance for everything that was performed during the configuration phase. This is important so that knowledge of the system can be disseminated throughout the company even after its complete implementation.

After the implementation process, we have the step that consists of training, monitoring the transition and the implementation itself. It is at this stage that most of the implementation errors occur. When implementing a WMS or an ERP, the current routine and culture will change and people's inability to accept changes can end up being fatal to success.

At Nestlé, one of the main problems encountered by the ERP implementation team was exactly the lack of awareness among its employees that an ERP would radically change the way they work. This was also responsible for the enormous resistance of employees in dealing with the new system. They believed that their weaknesses would be exposed and that their great knowledge of the old system would end along with their sense of being irreplaceable (Worthen, 2002).
CONCLUSION

When buying storage management software, the difference between WCS and WMS must be clear so that the choice is as compatible as possible with the company's needs, since both have advantages and disadvantages. The benefits provided by the system to be acquired must be compatible with the objectives expected by the companies.

However, it is essential that, during the implementation of the WMS, everyone is committed, from top management to those involved in the day-to-day operation, in addition to availability of time and resources. The general conception phase is the most important of the implementation process, since it is there that the data and information that will be migrated to the new system are collected, in addition to strategic definitions. Any error in this step can mean future problems, as the system will use such values ​​to carry out calculations and suggestions.

It should be emphasized that, in general, with the WMS it is possible to obtain cost reductions, an increase in the level of service provided and better use of physical space, in addition to better inventory accuracy. =

1 The profile of each location consists of defining the type of product that can be stored at each address. This procedure is widely used to determine specific areas for hazardous or flammable products.

2 Item profiling is for identifying items that may share the same physical space, or else items that should not be stored side by side.

BIBLIOGRAPHY

BANZATO, Eduardo. Warehouse Management System WMS: Warehouse Management System. São Paulo, IMAM, 1998.

WORTHEN, Ben. Nestle ERP Odyssey. CIO Magazine – May 2002.

Other Readings

CHOPRA, S.; MENDEL P. Supply chain management; strategy, planning and operation. Prentice Hall, 2003.

FRANKLIN, Ronaldo. Knowledge of Handling and Storage. E-Quality Training and Research Center of InfoJBS Consultancy 2003.

MONTEIRO, Aluísio; BEZERRA, André LB Competitive Advantage in Business Logistics Based on Information Technology. Available inwww.ead.fea.usp.br. Article presented at the VI SEMEAD, USP 2003.

NAZARY, Paul. Importance of Information Systems for Logistics Competitiveness. Available in http://www.tecnologistica.com.br. Article published in Tecnologística magazine, Jul/1999.

SUCUPIRA, Cesar. Management of Warehouses and Distribution Centers through WMS Software. Available inhttp://www.cezarsucupira.com.br/artigos111.htm.

Logistics and International Trade Survey 2004 – CEL/Coppead (in press);

The Challenge of Exports – BNDES 2001;

MDIC – Siscomex and Secex;

Foreign Trade Statistics – World Bank 2003. (http://www.worldbank.org)

Ranking of Ports: Containerization International. (Container Traffic World Ranking 2002). (http://www.ci-online.co.uk)