SAP WM and EWM – When and Where?
With ever increasing focus on Supply Chain Execution Performance, many organizations are going ahead implementing stronger and comprehensive warehouse management solutions. Efficient warehouse operations, process granularity and enhanced integration with supply chain are becoming more and more important. In this context let’s discuss how SAP Warehouse Management solutions would help customers to address their needs.
SAP Warehouse Management (WM) has been part of SAP ERP solution since long broadly covering processes of goods receipt, goods issue, internal transfers and physical inventory. As part of ERP, WM provides seamless integration with other ERP components like Inventory Management, Sales and Distribution and Production Planning.
SAP Extended Warehouse Management (EWM) is the newest Warehouse Management solution from SAP and the functionalities covered go beyond four walls of the warehouse. In addition to the processes covered in WM, EWM supports major supply chain integration elements like – Cross Docking, Deconsolidation, Value Added Services, Slotting and Re-arrangement etc.
Organizations can follow different approaches to take a decision on solution they would like to implement. Those with no WM solution in place may conduct an objective assessment to see whether SAP WM solution would fit ,if yes what all needs to go in to the solution – Barcode readers, RF based hand held devices, Voice enabled operations etc. Organizations need to be cautious in choosing to implement WM solution in smaller /low volume facilities to reduce the risk of overkill. In an SAP environment it is possible to selectively implement either SAP WM or just Inventory Management in a single landscape.
Organizations that are already running SAP WM solution may like to enhance the solution to address needs like increased process coverage, granularity in processes, performance management etc. In this context SAP EWM would be a strong contender with capability to handle all major processes required to run an extended and distribution intensive supply chain. Depending on process requirements, current and planned solution landscape EWM can be deployed in different ways in relation to core ERP solution.
Organizations need to objectively analyze criteria given below to take the critical decision on whether they need a WM solution and if yes which of the SAP solutions would be a better fit – SAP WM or SAP EWM?,Key criteria for such a decision are:
– Number of facilities
– Number of materials handled in each of the facilities
– How many movements per day?
– How many of them are automated?
– Average inventory carried
– Nature of operations – Manufacturing, Distribution, Retail etc
– What is average number of people working in these warehouses?
– What is the average number of material handling equipments used?
– Is there a seasonal demand variation for the materials?
– How WM operations integrated with extended supply chain.
I will get in to more details in my next blog.