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SAPIMvs WM HowtoChoose Use andOptimize GavinKlausCatalystInternational Inc WhatWe llCover UnderstandingthedifferencebetweenWMandIMChoosingbetweenWMandIMOptimizingandovercominglimitationswithIMandWM InventoryManagement IM Keyfeatures strengthsInventorymanagementbyquantityVisibilityofon handquantitybystoragelocationManagementofspecialstocksEntryanddocumentationofallmaterialmovementsReal timeupdatesofinventoryDocumentationofallreceipts issuesandtransfersPhysicalinventoryCarryoutphysicalinventoryatthemateriallevelPerforminventoryadjustments R 3InventoryManagement IM cont Keyfeatures strengths cont InventorymanagementbyvaluePostingsupdateaccountassignmentsforcostaccountingUpdatesG LaccountforfinancialaccountingKeyintegrationpointsIntegratesdirectlywithMRP purchasingandinvoiceverificationProvidesinformationforMRP updatesPO usedtocheckconformityduringinvoiceverificationReal timeupdatesWhentransactionsareentered theresultsthestockupdatesrealtimetoreflectactualchanges SAPOrganizationalStructure OrganizationalStructureattheIMLevel ChallengeswithInventoryManagement Lackofdetailedvisibilitytomaterialflowe g Whenthedeliverypicklistisgenerated thedelivery s actualpickquantity isupdatedpriortoactualpickingRequiresmanualupdateswhenquantitiesdifferInabilitytoassignincomingmaterialstooutbounddemandtoavoidmultiplematerialhandlingcontinued ChallengeswithInventoryManagement cont ImmediateupdateofinventoryreceiptsandissuesSysteminventoryandstatusNOTrepresentativeofthephysicalprocessLimitedvisibilitytolocationsofmaterialsOnlypossibletoassignasinglefixedbinlocationperstoragelocationBinlocationis text only nostrategiesareavailable Solution R 3WarehouseManagement InitiallyreleasedwithR 2asanExtensionofIMIM WMintegrationisreal timeandautomaticEnablesgranulartraceabilityandcontrolAbilitytosynchronizethesystemandmaterialflowSimple to complexplacementandremovalstrategiesAssignmentofinboundorderstooutbounddeliveriesAllocationofstoragebinsProcessingofallstockmovementsvalidforWMReceipts issues transfersUtilizesstockplacementandremovalstrategiese g Nextemptybin additiontostock FIFO LG SMqtys Solution R 3WarehouseManagement cont InfancytomaturityFunctionalityconsiderablyexpandedwith4 6xandhigherTwo steppicking two stepconfirmation managingmultiplestoragelocationswithasinglewarehouseExtensionset2 0forEnterprisetoincludeCrossDocking YardManagement ValueAddedServices WMPicksUpWhereIMLeavesOff TypicalassignmentisonestoragelocationtoonewarehouseItispossibletohavemultiplestoragelocationsmanagedbyasinglewarehouse Quant Bin1 Quant Quant Quant Bin2 Stor Type2 Stor Type3 Warehouse1 Stor Location1 Stor Type1 Warehouse2 Stor Location2 Plant1 Location1 Plant2 Company IMLevel WMLevel Stor Type1 KeyWMFeatures ManagementofmaterialsProvidesbin leveltrackingInventorymanagementfunctionsVariousplacementandremovalstrategiesValue addedservicese g Specialhandlingrequirements labeling packaging PowerfulpickingcontrolTwo steppicking wavepickingFIFO LIFO large smallquantitypickingstrategies KeyWMFeatures cont WarehouseactivitymonitorsWAM RFMonitor outbounddeliverymonitor wavepickingmonitor TRMMonitor YardManagementCockpit Cross DockingMonitorCross dockingManagementofinboundandoutboundmovementsYardManagementAppointmentscheduling checkinandcheckout assignmentofdockdoors loading unloadingactivitiesTaskResourceManagementEnhancesWMbybreakingworkdownintodistincttask FullyIntegratedwiththeotherSAPApplicationsFeatures FlexibleWarehouseStructuresGoodsMovementsControlInventory WMIntegrationWithOtherKeyR 3Modules cont Source SAPWM LO530 WMIntegrationWithOtherKeyR 3Modules cont IM WMProcessingofallmaterialmovementsAutomatedcommunicationwithconfigurableprocessingSD WMTwo steppickingwithSD WMintegrationWavepickingopportunitiesProcessingindividualdeliveriesPP WMProductionsupportwithPP WMintegrationSupplyingmaterialstotheshopfloorInternalandexternalautomatedreplenishmentoptions WMIntegrationWithOtherKeyR 3Modules cont QM WMHandlingofinventorysamplesInspectionlotismaintainedwiththematerialdataHand heldterminals WMProcessingoftransferrequirementsProcessingoftransferordersBinandmaterialinquiries BenefitsofWM BenefitsBettercontrolofinventoryMoreaccurateinventoryAbletomaintainlowerinventorylevelsBettercontrolofinformationVisibilitytopickingandputawaystatusReducedcycletimeGartner 16 25 PickingProductivityImprovementBettermanageworkandworkforcetogainefficienciesToolstobalanceandoptimizeresourcesIncreasedpicking shippingaccuracy11 25 ReductioninCustomerReturns BenefitsofWM cont Measurablebenefits16 25 PickingProductivityImprovement11 25 ReductioninCustomerReturns10 25 SavingsinMaterialHandlingLabor10 40 SpaceUtilizationImprovement13 30 ReductioninScrap8 15 ReductioninCarryingCostsSource GartnerReport WhatWe llCover UnderstandingthedifferencebetweenWMandIMChoosingbetweenWMandIMOptimizingandovercominglimitationswithIMandWM WhenIsInventoryManagementtheAnswer IMisgreatwhen SmallfacilityLowerlevelsofinventoryonhandSimplisticmaterialhandlingprocessesLowervolumeofactivityOutsourcedwarehouseoperationsOnlyneedstoragelocationorbucketofinventoryvisibility KeyElementsWithIM RequireddataforIMPlant valuationandstoragelocationdataRelevantdataforIMWorkscheduling accounting materialsplanning purchasing classification storageandqualitymanagementIMmenuGoodsmovementsMaterialdocumentsReservationsEnvironmentFocusedonreporting listsandLIS WhenisWarehouseManagementtheAnswer WMisgreatwhenLargerfacilitiesLargenumberofmaterialsonhandHighervolumeorflowthroughTraceabilityandvisibilityiscriticalTrackmaterialflow status inventorylevelsComplexprocessesAutomatedsystems widespreadsite KeyElementsWithWM ExtendmaterialmasterWarehousemanagementviewNorequireddataDefinewarehousestructureMinimizethenumberofstoragetypesDefinebasedonsimilaranddifferentrulesforstoringmaterialsMixedstock StorageorHandlingUnitManagementDefinetheWMProcessesAutomatic semi automaticandmanualprocessingTransferordercreation confirmation postingchanges EvaluatingIMvs WM 1 Definebusinessprocesses2 EvaluateROIofaWMSsolution3 ConsiderRFfunctionality4 Trainingresourcesandschedule5 Focusonoptimizationopportunities Step1 DefineBusinessProcesses Startwithreceiving inventoryandpick shipfirstCreateandevaluateprocessflowchartsLookatprocessimprovementopportunitiesScorethelevelofcomplexityTargetareasforimprovementReducetraveltimeInventoryaccuracyReducematerialhandlingMapimprovementstoIMandWMfunctionality 1 DefineBusinessProcesses cont TheleveloffunctionalitythatcustomersneedinaWMSiscompletelydependentupontheirenvironment CustomershavetodefinetheirneedsbeforetheycanrealisticallylookforaWMS Source IntegratedSolutions Step2 EvaluateROIofaWMSSolution MeasureproductivityandaccuracybeforeandaftertheWMSinstallationReviewandanalyzepickingoperationsKeyareaofimprovementReviewandanalyzeinventoryaccuracyWhensupportedwithRF accuracycanreach 98 2 EvaluateROIofaWMSSolution cont Thereisno right timeforpayingbackaWMS buttypicalpaybacksarewithinsixto18months dependingontheinefficienciesofthecurrentoperationandhowmuchsafetystockwasneededtocoverdailyoperations Source TotalSupplyChain Step3 ConsiderRFFunctionality RFsupportsimproveswarehousebinaccuracyBinaccuracy 98 ispossibleReducesorderfillprocesscycletimeRFprojectsoftenhavea1yearorlesspaybackperiodSource Intermec Comparecurrentreceiptprocesstothetimesavedwhenthetaskisaidedbyautomaticdatacollection ADC 3 ConsiderRFFunctionality Example As is1 000palletsatfiveminutes pallet 5 000minutesWithtwominutessavedperpallet2minutes 1 000pallets 2 000minutes2 000 480minutesworkedbyeachreceiverperday 4 16receiverssavedfromthepalletreceivingprocess Step4 TrainingResourcesandSchedule Resourcestoevaluate guideandsupportaWMsolutionAfull time dedicatedWMresourceiscriticalThismayormaynotbethesameIMresourceTrainingscheduleAWMsolutionwillrequireacertainlevelofIMtrainingWMtrainingwillvarybasedonthedegreeoffunctionalitySupportresourcesConsiderasingleresourceforIMandWMifpossible 5 OptimizationOpportunities PickingoperationsandinventoryaccuracyWhatareyourbaselinerequirementsWhatisthevolumeofactivityEvaluatepickingpathsanddemandLookatyouraccuracynumbersoveraperiodoftimePerhapsmonthly quarterly annuallyMaterialhandlinglaborcostsSpaceutilizationimprovementsPackingtasksCanyoubenefitfrompackingwhilepicking WhatistheBESTStockManagementSolution 1 InventoryManagement2 LeanWarehouseManagement3 FullWarehouseManagement4 DecentralizedWarehouseManagement Option 1 InventoryManagement Pro sSimplisticKeyreceipt issueortransferinasinglesteptransactionImmediateupdateofinventoryRequireslesstrainingcommitmentFewertransactionstodocumentandpresentTrace abilityofallmaterialpostingsintoSAPR 3Date user material quantity storagelocationReal timeupdateofaccountinginformation 1 InventoryManagement cont Con sDoesnothandlecomplexwarehousesoperationswellUnabletomonitoractivitiesLackstoolstomanageresourcesandtasksLacksfunctionalitytooptimizekeyprocesses picking InaccuratesysteminventoryInventoryupdatedbeforethephysicalmovementRequiresadditionalworkiftherearediscrepanciesLimitedtrace abilityOnlyvisibilityiswhenthesystempostingtookplaceNovisibilitytothefollowonphysicalactivities Option 2 Lean WarehouseManagement UseofverysmallportionofWMcapabilitiesYoudonotprocessgoodsreceiptsorissuesasasubsequentprocessinWM NostoragebinsaremanagedintheWMapplicationEvolvedfromSDpicklistPut awayandpickfrom1ormorefixedbinsBinishardassignedonmaterialmasterTO sarecreatedforpicksandputaway andpicklistiscreatedfromTO s 2 Lean WarehouseManagement cont Pro sRequireslessconfigurationthanfullWMReducednumberofstepsintheprocessUseoftransferordersaspicklistsConfirmationisnotrequiredAdditionalprocessingoptionsConfirmput away picking over deliveries shortages batchesPrinttransferordersIntegrationtoHRAdditionalpickingfunctionalityWavepickingispossiblewithLeanWM 2 Lean WarehouseManagement cont Con sMusthaveafixedbinassignedforallmaterialsRandomstorageisnotpossibleInventoryisstillunderIMfunctionalityonlyInventoryoptionsareatthestoragelocationStockdifferencescanonlybeprocessedinMM IMLacksadditionaloptimizationopportunitiesPicking packing binaccuracyNostrategiesareusedLackofpickingandputawaystrategies Option 3 FullWarehouseManagement Pro sOptimizationopportunitiesPicking TwosteppickingPacking PickandpackinasinglestepCross docking Inbound outbound prod materialsMonitoringandrealtimevisibilitytoprocessstatusVisualqueuesatthedetailedstepsOpentasks completedtasksAdditionalinventorymethods annual zerostock ThemoduleisFREEwiththepurchaseofSAP 3 FullWarehouseManagement cont Con sInventorycountinginterfereswithoperationswithoutRFPriorto4 7extensionset2 0InitialoverheadtosetupdependingondesignMasterdataCapacitychecking controlcyclesConfigurationrequirementsDesigningthewarehouselayoutandsetupPotentialforadditionalstepstosupportprocessingConfirmationsClearingdifferencesProcessingpostingchanges Option 4 DecentralizedWarehouseManagement UseofSAPasastandaloneWMSWithSAPorotherERP hostasthecoresystemCoresystemanddecentralizedWMrunonseparatemachinesCommunicationisthroughBAPI sfortransactionsandIDOC sformasterdataGoodsmovementsdonethroughdeliverynotestothestand aloneSAPWMsystem 4 DecentralizedWarehouseManagement cont Pro sOnaseparatemachineDecreasescriticalityofdowntime24x7operationCanleveragenewerSAPR 3releasesEvenifcoresystemisonanolderreleaseCanaddadditionalwarehouseswithoutimpacttothecoresystemCancommunicatetomultiplecoreERPsystems 4 DecentralizedWarehouseManagement cont Con sCoresystemisnot24x7operationIDOCand orBAPIerrorsIDOCfailuresHumaninterventionisrequiredtoworktheerrorqueueIDOCoverheadIDOC sdonotofferalloftheavailablefieldoptionsthatausermayormaynotusewiththePCtransactionMustmodifytheIDOCSAPConsolehastobesetupinthedecentralizedsystemandinthecoresystem ScalingtheSolution OperationalComplexity TransactionVolume IMOnly LeanWM WM DecentralizedWM TRM WhatWe llCover UnderstandingthedifferencebetweenWMandIMChoosingbetweenWMandIMOptimizingandovercominglimitationswithIMandWM OptimizingandOvercomingLimitationsWithIMandWM 1 PhysicalInventorytips2 Enhancevisibilityofmaterialflowandlocations3 Automatepickingandput away4 Automaticallyreplenishfixedbins5 Consolidateyourpickingactivities6 OvercomebottleneckswithRF 1 PhysicalInventoryTips IM OnlypossibleifthestoragelocationdatahasbeenmaintainedSolution ActivateautomaticstoragelocationformovementtypesthatreceivematerialintotheplantAvoidstheneedtocreatestoragedatamanuallyFormaterialswithmultiplestoragelocationreqmts UsethemasscreationoptionforenteringallvalidstoragelocationsatonetimeintoasingleentryscreenTransactioncode MMSC 2 EnhanceVisibilityofMaterialFlowandLocations IM UsefixedbinassignmenttogainadditionalvisibilityMaterialmasterstoragelocationviewTwo steptransfersvs one stepmovementsStoragelocation to storagelocation movements313 315 Plant to plant movements303 305 351 352 OutbounddeliverymonitorUsetoviewoutbounddeliveries shipmentsandloadingactivities 3 AutomatePickingandPut away WM DefineapickingstrategyperstoragetypeA PartialquantitymanagementIfpickingresultsinpartialquantities pickfromherefirsttoavoidbreakingnewpalletsM Large smallquantitiesincludedUsetofacilitatelargerquantitypicksfrombulkareasandsmallerquantitypicksfromrackareasP FixedbinfrommaterialmasterForfastmovingitems assignadedicationlocationtowardthefrontofthewarehouseUsereplenishmenttoenoughmaintainstockfordemand 3 AutomatePickingandPut away WM cont DefineaputawaystrategyperstoragetypeAVOIDmanualputawaypracticesC OpenstorageUseforlargeitemsthatdon trequireaspecificbinassignmentI AdditiontoexistingstockUsefulforconsolidatingreceiptsofthesamematerialuponput awayCaution Sinceonlyonequantresidesinabin allmaterialsinthebinadoptthesamereceiptdate unlessbatchorstorageunitmanaged 3 AutomatePickingandPut away WM cont Defineapickingstrategyperstoragetype cont L NextemptybinGreatfitforhighrackstorage wherebyastandardracksectioncanhold2 3unitsofstorageUsefulforstoringpalletsofmaterial onepalletperbinlocation 4 AutomaticallyReplenishFwd PickingLocations WM BatchprogramAscheduledjobtoreadfixedbindataandgeneratereplenishmenttransferorders2requiredprogramsRLLNACH1RLAUTA10 Upontransferorderconfirmation optionCreatesanautomaticreplenishmentTOwhenapickconfirmationdrivesthefixedbinlocationbelowthemin stocklevel 5 ConsolidateYourPickingActivities WM Two steppickingBasedonselectioncriteria relevantdeliveriesarereadandlikematerialrequestsarecollectedThiscollectionresultsinasingleaggregatedpickingorderandtaskforeachlikematerial firststep
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