Most executives and their employees ask themselves, why would you implement Extended Warehouse Management??? Before one can answer this question, it is more important to understand what Inventory Management/Warehouse Management and EWM are. Only after this we can go and explore the differences between them. Therefore I will try to answer this from my perspective in this blog.
Inventory- and Warehouse Management
Let’s start with Inventory Management, IM is part of the Materials Management module and is also integrated with the other logistics modules like PP, SD and QM. See below, for the integration between IM and other modules:
- MM: IM provides information for MRP, after which PO are created and quantities are posted in IM after goods receipt.
- PP: staging of components for production orders is managed in IM and finished products in the warehouse are posted in IM.
- SD: availability check is performed after creating a sales order and after a delivery is created quantity is reduces from the stock.
- QM: in case of goods movement, it is determined if an inspection is needed and stock is either registered as in quality or blocked in IM.
The integration does not stop there, but it continues into WM. Here quantities and value are managed by IM and the WM components reflect the structure of a warehouse in form of complex storage bins and WM monitors the allocation of the storage bins and any transfers. Due to this an entire warehouse complex can be mapped in detail to storage bin level. With this you not only have an overview of the quantities of each material, but also a can determine the exact location of materials. Besides this WM has other features to enhance the management and storage of materials:
- Storage Bin Management: map an entire storage facility in WM (automatic warehouse, high rack-, bulk- or fixed storage), to manage material at storage bin level.
- Good Movements: process all goods movements in the warehouse, including goods receipt, goods issue, stock transfers, staging for production, automatic replenishment, managing dangerous goods and processing differences in stock.
- Planning and Monitoring: the system supports to plan, monitor and optimise work processes due to the overviews of all the goods receipts, goods issues and warehouse stocks.
- Radio Frequency Connection: with the help of RF data can be entered quickly and flawlessly, by scanning the barcodes information can be recorded and verified to ensure high standards in a warehouse.
- Decentralized WMS: possibility to run it as a standalone system without a central ERP system.
- Warehouse Control: interface to external systems to integrate automatic putaway, stock removal systems or fork lift control into WMS for all internal movements with help of ALE.
Extended Warehouse Management
After having discussed IM and WM, lets move on to EWM. It has been almost 10 years since SAP released EWM, this is a proper Warehouse Management System which can control/monitor every process in a warehouse from the moment goods arrive at the yard in a truck until leaving. Unlike WM, there are three options of deploying EWM:
- EWM as an add-on, on the SAP ECC server.
- Install EWM on a SAP SCM server.
- Standalone on a dedicated server for just EWM.
EWM can be used from a simple warehouse to a complex distribution centre. Because of the deployment methods and the possibility of turning on or off functionalities depending on the requirements the clients. It gives you the option to map the entire warehouse complex in detail from the yard to the storage bin level. This gives the exact location of a certain material and the quantities at storage area level and even at storage bin level. Besides the features of WM, EWM offers:
- Storage Bin Management and Optimization: EWM enables you to track all stock movements constantly in detail and for the optimization it assigns the correct storage bin (depending on the size and frequency of access). Besides using physical inventory procedures and stock differences to ensure the inventory matches between IM and EWM.
- Goods Movements: besides all the standard warehouse movements, EWM includes layout- and process-oriented storage control, automated wave picking creation and resource optimization via rule based bundling of warehouse tasks.
- Work Center: this is used to map a physical unit, where activities such as packing, deconsolidation, weighing, quality inspection and counting are performed.
- Physical Inventory: in EWM you can compare actual, existing and physical material stock based on the product or storage bin. In addition it offers integrated RF functions to perform all the warehouse tasks, such as counting, putaway and inventory control.
There are many more features of EWM, one of the most important is the integration with the ECC modules (MM, SD, IM, LE, QM, etc.). For the master data integration EWM uses the Core Interface (CIF) and Queued Remote Function Call (qRFC) for communication between ECC and EWM.
Before looking at the differences between IM/WM and EWM. Let me point out that EWM is not a replacement of WM, as it remains a viable alternative for mainly for small and medium size warehouses with basic processes and simple operations.
WM provides support for warehouse and storage processes, such as:
- Internal movements and replenishment
- RF and voice putaway and picking
- Warehouse internal packing
- Optimise warehouse movements using task and resource management
Besides the processes above, EWM also supports a lot more like: integration with Transport Management and Logistic Service Providers for the outbound process, Yard Management, Material Flow System for fully automatic warehouse and standard integration with other SAP components. For the other differences, see the picture below: