2010 WMS Market: Adapt Your Strategy
It is a challenging time to develop a business case for a warehouse management system
(WMS). While the tight operational controls required in the current business climate can be
provided by a WMS, the capital necessary to fund these initiatives has never been more diffi-
cult to acquire. How can progress be made toward tighter operational controls considering the
current situation of limited funding?
—Kevin Hume, principal, Tompkins Associates
he current economic realities require new
strategies to approach warehouse management
or any other supply chain management software initiatives.
nomic order quantities—which will provide the highest customer service levels—that make the most cost-effective use
of the distribution assets. Down the road, the investment in
supply chain management technology can be leveraged to
One strategy to better position supply chain management scale operational efficiencies when significant customer
initiatives for the limited investment opportunities is to growth returns.
develop a “self funding” business case that frees up working
So, an inventory assessment is one strategy that can free up
capital, resulting from quick-hit improvement opportunities. capital and help establish a solid business case for investing in
For example, inventory assessments are a great way to supply chain management software initiatives.
quickly identify opportunities to selectively reduce inventory,
while simultaneously maintaining or improving service levels. By
leveraging the savings from these initiatives, funding will In 2010, a large number of competing efficiency initiatives will
become available to invest in necessary supply chain manage- be fighting for the same limited pool of investment dollars.
ment software. The supply chain management software can then Make the most of these challenging times and identify specific
be used to extend the initial savings opportunities by providing strategies that can maximize the value of investment in supply
the visibility and process control needed to establish the optimal chain management technology. Develop a strategy to free up
balance between transactional costs and inventory turns.
working capital now; then leverage that investment in supply
With higher visibility and better inventory processes in chain management to be prepared to cost effectively scale
place, companies will be able to determine the best eco- your operations when order growth returns.