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Finding the right WMS:
A guide to the different types, the value, and your options
to improve efficiency, throughput and cost
September 6, 2012
© 2011 SAP AG. All rights reserved. 2
Today’s Speakers
Steve Banker
Service Director, SCM
ARC Advisory Group
Richard Kirker
Solution Owner
Warehouse Management
Andres Botero
Global Lead
SCE Marketing
3 © ARC Advisory Group
Warehouse Management Defined
A warehouse management system’s primary mission is to manage a ware-house’s resources,
including space, labor, equipment, tasks, inventory, and material flows. At ARC we define a WMS as a real-time solution that utilizes radio
frequency, voice recognition, radio frequency identification (RFID), or real-time location
systems.
One of the Most Mature Enterprise Applications
•Over 30 Years Old
•$1.3 Billion Market Growing at Over 7% per year
4 © ARC Advisory Group
Best Technologies for Reducing Costs in the Warehouse
Over the past five years, which technology implementation has led to the greatest reduction in warehousing costs at either an individual warehouse or network of warehouses?
1,9%
3,8%
5,8%
5,8%
7,7%
9,6%
9,6%
13,5%
42,3%
0,0% 15,0% 30,0% 45,0%
Other Material Handling
Other Automatic Identification
Other Software
Automatic Storage and RetrievalSystems
Conveyors and High Speed Sortation
Inventory Planning Software
Labor Management
Voice Recognition Units
Warehouse Management
5 © ARC Advisory Group
Payback Period for WMS
What was your payback period for this technology (brand new WMS or upgrade)?
9,1%
13,6%
22,7%
22,7%
18,2%
13,6%
0,0% 10,0% 20,0% 30,0%
Not yet obtained
Greater than 3 years
Between 2 and 3 years
Between 1 and 2 years
Between 6 months and 1 year
Less than 6 months
6 © ARC Advisory Group
WMS Solutions Exist on a Continuum
SAP EWM is Best of Breed, SAP WM is a Mid-Range Solution
WMS Continuum
WMSLight
WMSMid-Range Solutions
Best-of-Breed
© 2012 SAP AG. All rights reserved. 7
SAP's Warehouse Management History (1994–2012) A long history of warehouse management business, process, and IT expertise
1994 2006 2012
SAP R/3:
warehouse
management
functionality
(SAP R/3 2.0–4.7)
SAP Supply Chain Management (SAP SCM)
SAP EWM application
….
Best-in-class
warehouse
management
(SAP EWM 7.0–7.02)
Advanced
warehouse
management
(SAP EWM 5.0– 5.1)
Distribution
center
logistics
Goods storage
Logistics execution
… (SAP EWM 9.0)
© 2012 SAP AG. All rights reserved. 8
SAP WMS products: from ERP WM to EWM New generation warehouse process flexibility, performance and coverage
SAP SCM Extended Warehouse
Management
(Strategic investment solution /
strong roadmap)
SAP ERP Warehouse
Management
(Continuous
improvement /
maintenance)
Migration
Tools
Basic warehouse processes
Simple warehouse operations
Small & medium-sized
warehouses
Comprehensive warehouse mgmt. processes
Full process transparency
Flexible automated processes
High performance, high volume
warehouse operations
Medium & large-sized warehouses
Mid-Range Best-of-Breed
9 © ARC Advisory Group
Factors to consider
Starting point
• Any WMS or AutoID in place?
• Standard ERP across company in place?
Cost
TCO
Type of warehouse (DC, spare parts, factory)
No. of warehouses in network
Complexity of warehouses
Likely need for flexibility (downstream vs. upstream in supply chain)
Integration considerations
© 2012 SAP AG. All rights reserved. 10
SAP Supply Chain Execution Platform
SAP Event Management (Track & Trace)
SAP Transportation
Management
SAP Extended
Warehouse Mgmt.
Supply Chain Execution Platform
Supply Chain Execution Platform
Synchronized solution delivery
SCE Suite implementation in 1 instance
Out-of-the box SCE integration
SAP ERP • Order-to-Cash
• Procure-to-Pay
• Dangerous Goods Mgmt.
SAP GTS • Customs & compliance mgmt.
© 2011 SAP AG. All rights reserved. 11
Common EWM drivers over ERP WM
Warehouse Order Creation – System creates optimized work
packages (e.g., pick-path, pallet build, etc.)
Sophisticated wave management
Advanced Yard Management Functionality
Deconsolidation/fanning
Slotting
Rearrangement (change bin assigned to product because of a
change in activity or other characteristic)
Advanced labor management functionality
Internal routing – warehouse moves can be granularly modeled by
process or layout
© 2011 SAP AG. All rights reserved. 12
Common EWM drivers over ERP WM (2)
Advanced replenishment techniques of forward picking areas
Native integration with Environmental, Health & Safety (EH&S) for
route determination, storage checks, dangerous goods paperwork
Flexible mobile data entry framework
(e.g., screen modification wizard, exception handling, etc.)
Improved analytics with delivered BI and BOBJ Content
(Crystal Reports, Xselsius Dashboard)
Warehouse Monitor as central reporting and management tool
Proven performance in high-volume environments
More enhancement capabilities without modifications
Goods Receipt Optimization
(ability to check existing inbound deliveries or create new inbound
deliveries from expected goods receipts)
EGF (Easy Graphics Framework) for creating Dashboards
© 2011 SAP AG. All rights reserved. 13
Common EWM drivers over ERP WM (3)
Advanced connection Material Handling Equipment without
middleware (direct control at pLC level)
Removes restrictions in serialization
Removes restrictions regarding Handling Units
Native RFID integration with Auto-ID Enterprise
Automatic stock adjustment with plant-to-plant delivery discrepancy
Initiation of all warehouse activities from EWM even as decentralized
deployment (e.g., putting stock on hold, restricting batches, scrapping)
More integration with more Business Suite components
(e.g., Invoice before Goods Issue)
Production staging in decentralized environment
© 2011 SAP AG. All rights reserved. 14
Differentiators and value of SAP EWM Comparison of SAP EWM with WM functions of SAP ERP
SAP’s strategic warehouse management solution
Enhanced Visibility and flexibility
Labor management
© 2012 SAP AG. All rights reserved. 15
Overview SAP EWM Customer & Market Status Strong customer growth and implementation momentum
Facts and figures
Over 120 new customers in 2011
More than 150% new installations in 2011
Over 150 ongoing implementation projects
Productive use of SAP EWM in 20 countries
and 24 industries
Sample customers
Live customers and live sites Customer geographical coverage
Coca-Cola
Enterprises
0
50
100
150
200
250
300
Dec 2007 Dec 2008 Dec 2009 Dec 2010 Dec 2011
Live sites
Live customers
© 2011 SAP AG. All rights reserved. 16
Who adopts
SAP Extended Warehouse Management and why?
SAP WM and New Customers
Existing ERP customers with legacy or “Niche” warehouse solutions
Existing ERP WM customers
New customers with legacy solutions, multiple solutions, multiple architectures
Manufacturing & Distribution
Consumer Products & Life Sciences
Retail & Wholesale Distribution
Discrete Manufacturing & High Tech
Process Industries & Chemicals
Logistics Service Providers
WM
S S
itu
ati
on
In
du
str
ies
Reduce costs through better warehouse
efficiency, increased labor productivity and
better space utilization
Increase transparency in stock and
processes
Increase flexibility in warehouse process
modeling
Implement customer specific put-away and
retrieval strategies
Quickly onboard new customers
Better manage value added distribution
processes
Strong integration with other SAP solutions
Integrated Material Flow System (MFS) for
automated storage and retrieval
Why do Companies select SAP EWM?
© 2012 SAP AG. All rights reserved. 17
30% increase in warehouse productivity
The best are leading the way with SAP EWM
Near zero customer-complaint rate
Increased speed and significantly
reduced picking times
20 warehouses live using the same template
34% ongoing labor cost reduction
© 2012 SAP AG. All rights reserved. 18 Public
Services and ecosystem around SAP EWM Strong service offering and ecosystem
Education
Classroom
training
E-learning
Certification
program
Ecosystem
SAP Community
Network
User group for
SAP EWM
Social networks
for SAP EWM
SAP consulting
practice
24x7 global support
Quality assurance
services and
SAP Safeguarding
Rapid-deployment
solutions
Custom development
Partners
Global partners
Expert logistics
partners
Local partners
Complementary
software products
Service and
support
© 2012 SAP AG. All rights reserved. 19
SAP EWM Migration Tools & RDS SAP ERP WM > SAP EWM
Migration Tools Accelerated migration of data from WM in SAP ERP to SAP EWM
Migration Tools
Master data migration
Products
Bins
Stock
Physical Inventory
Migration guide
Rapid Deployment Solution
System / data migration support
SAP
EWM
SAP
ERP
Master data,
inventory,…
20 © ARC Advisory Group
ARC Advisory Group research indicates SAP is #1 in WMS software market segment1
Just released report by ARC titled “Warehouse Management Systems:
Worldwide Outlook 2011-2016” (August, 2012) evaluates market share of all
vendors by geography, segment, category and customer tier.
Results:
SAP is #1 in the WMS software market segment1
SAP EWM’s market share has experienced tremendous growth
SAP is #3 in market share in the overall2 WMS market3
SAP is #1 in overall market share in Latin America and #2 in Asia,
the regions forecast to be the fastest growing in 2011-2016
1. Based on market share.
2. Overall WMS market includes software, maintenance, implementation, and SaaS.
3. If the report had included revenue from the SAP ERP WM product, SAP’s market share would have been even higher.
21 © ARC Advisory Group
ARC Advisory Group research indicates SAP is #1 in WMS software market segment1
“Some customers tell us that SAP’s EWM solution is becoming functionally rich
enough that it can be considered a best of breed solution.”
“SAP EWM has gained strong traction in the marketplace due to its robust
functionality, interoperability with the SAP suite of solutions, and the large
existing SAP installed base of potential customers.”
“This solution offers robust functionality that includes labor management and
advanced slotting functionality without any extra fees”
“Built-in support for most languages gives the product global appeal.”
“The product has gained traction in the marketplace (the number of live sites
doubled in 2010 and expanded at an even faster rate in 2011) due in part to
offering a robust solution with differentiated functionality.”
SOURCE:
ARC Advisory Group “Warehouse Management Systems: Worldwide Outlook 2011-2016,” 08/2012
22 © ARC Advisory Group
Wrap up
The WMS market
Value of a WMS
Different types of WMS
Market evolution and SAP EWM
...
© 2012 SAP AG. All rights reserved. 23
Wrap-up
Best-in-class, integrated warehouse
management solution
Comprehensive, deep warehouse
management expertise
Strong and growing customer base
Strategic investment area for SAP
Integral part of platform road map for
supply chain execution
SAP EWM
Thank you!
Questions?
Richard Kirker
Solution Owner EWM
Andres Botero
Global Lead, SCE Marketing
Steve Banker
Service Director, SCM
ARC Advisory Group
© 2013 SAP AG. All rights reserved.
© 2013 SAP AG. All rights reserved.
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