Inventory Manager Software

Can Best of Breed WMS Solutions be Lowest Cost of Ownership?

Tuesday, February 9, 2010 by Chad Collins

I spent some time last week with a HighJump Software customer who is considering further expansion of HighJump WMS solutions in their distribution centers. The customer is undertaking a massive ERP program that will allow the ERP system to be the IT backbone of their worldwide operations. They are also evaluating WMS solutions from this ERP provider.

In a meeting with senior IT leaders of this organization, I explained that I was highly confident the outcome of their pending due diligence regarding total cost of ownership (TCO). I contend that a best of breed solution will result in lower long term costs for this IT organization. Here are a few things that make me confident in my position:

Best in Class Functionality

While ERP-based WMS solutions have advanced significantly, they are limited to the “classical” warehouse operations including receiving, put-away, inventory control, picking and loading. Supply chain best practices such a labor management, slotting management, advanced wave planning, and last mile delivery are not traditionally supported with ERP WMS solutions. This means that when supply chain operations teams demand these capabilities, IT organizations are forced to address them with expensive customizations or bolt-on solutions with multiple integration touch points.

Upgrades

A WMS solution typically has a 10 year lifespan. In this lifespan a WMS could be upgraded five times. ERP upgrades are generally more expensive to upgrade because of the interdependencies between modules and re-application of source code customizations. Additionally, corporate IT governance and change management processes often make it difficult to upgrade a single module. Therefore the business users may be forced to wait for new features because of dependencies on modules that have nothing to do with distribution and logistics. View this video to learn more about HighJump’s approach to simplified upgrades.

Adaptability Tools

If your organization views distribution as a source of competitive advantage, then ERP-based WMS could be problematic. By definition, a competitive advantage must be unique to the organization. Business processes available in commercial off-the-shelf software packages (like ERP) therefore cannot contain business processes that are sources of competitive advantage.

To really ensure you have the flexibility to maintain and create further sources of advantage in your distribution operations, your supply chain logistics software must have the ability to create processes that are unique to your business.

HighJump has a unique approach that allows customers to define unique workflows that does does not involve any source code modifications. I am not aware of any ERP based WMS solutions with a similar architecture.

Without this architecture it can be very expensive for IT organization to deliver these workflow changes.

Comments for Can Best of Breed WMS Solutions be Lowest Cost of Ownership?

Thursday, February 11, 2010 by Claus:: Chad, Specifically about upgrade I would like to comment that we have just upgraded Highjump platform from version 9.4 to 10.5 and it was really easy (1 day activity). It is the first time we did it in a production environment here in Brazil so now I can say that everything I have heard from HJ solution is totally true. By the way, I am talking about 5 DCs and more than 1 million square feet. Abraço,
Thursday, February 11, 2010 by John Mayo:: Oracle ERP has a workflow capability but I have not been exposed to it. How is this capability different or deficient than High Jump's workflow?
Thursday, February 25, 2010 by Chad Collins:: John, thanks for your question on workflow capability. I am not an expert in the Oracle product but I have seen it and spoken to many users. My understanding of Oracle's workflow capability is that it provides notification and processing of certain tasks that are generally administrative within the sytem. The HighJump workflow adpapting tools and resulting workflows are tailored for executing supply chain execution business processes. Our tools will tailor processes like receiving, picking, and cycle counting. The benefit to this level of flexibility is that these processes are executed thousands of times per day in the warehouse. If you can tailor these processes to your specific needs there is significant benefit in labor reduction, accuracy, and volume.