Introduction to supply chain management (SCM) and warehouse management system (WMS) integration

Supply chain management (SCM) and warehouse management system (WMS) integration can improve the performance of both software systems. SCM WMS integration comes with some IT challenges, such as data field mapping.

Ideally, every link in a supply chain is connected to at least one other link, and warehouse management system (WMS) software is no exception. While almost any WMS can improve operations inside the four walls of the warehouse, even greater benefits come from supply chain management (SCM) WMS integration.

WMS integration nowadays is more an issue of business processes than IT, say industry analysts. WMS software typically ships with one-off integrations with other vendors' enterprise resource planning (ERP) and other SCM software. If it doesn't, it has a programming tool and interfaces for writing custom integrations.

Furthermore, by rewriting their proprietary software in service-oriented architecture (SOA), many vendors have made SCM WMS integration an easier, building-block process.

"The first piece of the integration is master data management," said Greg Aimi, supply chain director at AMR Research. "Any item you're going to have in the warehouse needs to be represented." And once SCM WMS integration has taken place at the IT level, you still need to map the data fields in the two programs, Aimi said.

To other SCM software, the WMS is a sort of black box that inputs ERP orders and outputs receipts and other inventory and transactional records back to the ERP. It might also send shipping orders to a transportation management system (TMS).

"The order and the order line items -- that's the real execution data of the WMS," Aimi said. "Inventory has to be in the accounting system because it ends up being an asset that you have to manage. The TMS will turn orders into optimal shipments."

Integration is not just a software issue. The WMS software has to work with bar code scanners and printers and other data-collection devices. If the warehouse has automated material-handling hardware, there is probably a warehouse control system (WCS) that must be carefully integrated with the WMS.

The major ERP vendors all sell industrial-strength WMS software, and while some acquired their WMS from another vendor, integration issues have largely disappeared, analysts say. Integration with third-party WMS software is also good. "SAP has certification standards," said Steve Banker, service director for supply chain management at ARC Advisory Group. "The WMS vendors who are certified will integrate according to SAP's standards. Oracle does the same thing."

The old best-of-breed vs. ERP debate rages in the specialized realm of SCM WMS integration, but the lines have blurred as high-end WMS software takes on some traditional ERP functions, and vice versa, according to Banker. WMS software with labor-management features, for example, can handle some of the functions of an ERP human capital management (HCM) module.

About the author: Freelancer David Essex has covered information technology for BYTE, Computerworld, PC World, and numerous other publications and web sites.

Dig Deeper on WMS and ERP systems