SMART MATERIAL MANAGEMENT

• No longer a product purchasing function

Ex: Development of the Agile Trac RTLS System at Ellis

• Different ways:

1. IT in Materials Management2. Use of RFID Warehouse

Management3. Automated Purchasing4. WCS VS WMS

USE OF IT IN MATERIALS MANAGEMENT

Use of IT can generate various types of information / reports to be used in materials department.

1) Long-term production schedule.

2) Short-term schedule.

3) Materials manual.

4) Requirement of non-stock items from user departments.

5) Information regarding lead time, supply position (shortages), price

trends, anticipated price changes, etc.

6) Production Schedule handed over to production department.

7) Materials requisition from the production to stores.

8) Materials supplied from stores to production.

9) To and fro information between stores and inspection.

10) Information regarding receipts from the stores.

11) Date regarding issues from stores.

12) Due dates of supply from purchase department.

13) Information to purchase department for follow up of supplies.

14) Purchase requisition to purchase department.

15) Purchase order.

16) Materials from suppliers to stores.

17) Previous year’s consumption data.

PURCHASE REQUISITION

A purchase requisition is a process of requesting and authorizing procurement of goods and services by a department in the organization.

It contains a description and quantity of the goods or services to be purchased.

These requests are documented and routed for approval within the organization and then delivered to the accounting group.

CHALLENGES FACED IN IMPLEMENTING A PURCHASE REQUISITION PROCESS

A manual paper-based process is laborious as the requests are manually typed, rekeyed, logged, validated, routed, and stored.

It results in Inefficient Error prone processing Data scattered Waste time for user Slow requisition cycles.

Manual notification, tracking, and reporting contribute to inefficiency and prevent effective control of the procurement cycle.

ADVANTAGE OF AUTOMATING PURCHASE REQUISITION PROCESS

By automating the purchase requisition process an organization can minimize risk and keep audit trails in the purchase requisition process but automation can only solve few tasks of manual entry errors, misuse, physical loss and can be done by any system.

BPM SOFTWARE

Business process management software(BPM) is a systematic approach to making an organization's workflow more effective, more efficient and more capable of adapting to an ever-changing environment.

A business process is an activity or set of activities that will accomplish a specific organizational goal.

The BPM solution can get real time data and bring all stakeholders on the same platform for effective collaboration.

BPM SOFTWARE BENEFITS Organizations’ can automate purchase requisition processes to

reduce administrative costs and better manage vendor payouts. If the requisition process is built on a BPM SOFTWARE platform,

organizations can easily integrate their ERP and other core business systems with automated purchase requisition processes.

As a result, organizations can shorten approval cycles, reduce administrative overheads with effective control

Increase resource efficiency and productivity by streamlining purchase process

Eliminate human intervention and increase accuracy of data Permission based access to users

WMS & WCS

Role of the WMS

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WMS made their debut in the mid 1980s

The WMS acts as a business planning system focusing on planning the "business needs" of the warehouse (POs, Orders, Inventory Locations, Labor)

As the “System of Record” the WMS maintains and manages a vast amount of information such as inventory data, purchase orders, customer orders, and historical data.

The WMS processes large amounts of data in a non real-time mode to arrive at the daily workload of what is to be processed by the material handling systems and labor resources on a day-to-day basis

The WMS manages the non-automated operations in a DC

Manages information across multiple facilities and the system can physically reside offsite

WMS employs highly standardized software products that provide well defined services. Customized modifications to WMS can be extremely costly and threaten future upgrades and support.

Role of WCS

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Warehouse Control Systems emerged 20 years ago to bridge the gap between higher level information systems, such as Warehouse Management Systems, and the warehouse floor by allocating, balancing, managing , and monitoring tasks executed by disparate automated material handling equipment and subsystems in real time

Using business rules, and real time data, a WCS synchronizes the activities of multiple automated equipment subsystems, human resources, and material flow, and drives control decisions and exceptions.

A WCS provides a uniform interface for a variety of equipment to the upper level management systems such as WMS

A WCS optimizes asset utilization

A WCS operates within the four walls of the facility and the system is resident in the facility

Modular in nature. Employs easily configurable and customizable software to meet the unique, and ever-changing business process requirements of an industry or company

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User Interface

Reports AlertsHost

Interface

Manage Inbound POs & Receiving

Manage Outbound Orders & Shipping

Inventory, Storage & Location

Management

User Interface

Reports Alerts

Host Interface

Equipment Communication

& Control

Activity Execution Receiving, PutAway,

Replenishment, Picking, Packing, Shipping

WMS

WCS

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WMS and WCS fill two very different complimentary roles

WMS WCS

Planning the business (Composer)

Executing the business (Conductor)

Manage the non-automated operations

Control the automated equipment , human resources, and operations

Process vast amount of non-Real time data to plan and manage the business

Use of real time data & business rules to control execution of activities in the DC

Multi-facility Within the four walls of the DC

Manage the expected Manage the exceptions

Highly standardized, well defined functionality, expensive to change

Modular, highly configurable and customizable, inexpensive to change

WCS Today

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WCS Today…. Information flow drives Material flow in the DC Managing execution of tasks by disparate automated material handling equipment and subsystems in real time Directing Human Task/Activity Control Such As:

Receiving Put Away Replenishment Order Picking Consolidation Sortation

Providing Human Interface Control at point of Action Workstation Displays RF Terminals & Displays Light Directed Communication Voice Directed Communication

Provide enterprise visibility of real-time operational conditions Managing exceptions and control decisions in real time Providing historical performance data and resource productivity metrics