How important is a warehouse management system ERP strategy? To answer this question, you should first answer two other key questions. How important is it to your business to make sure that orders are manufactured and shipped on-time? And what software/hardware strategies have you put in place to ensure that your core business functions operate if one or more of your systems fails? For most companies fulfilling orders on time is very important. However, far too often these same companies don’t have an answer to the second question. There are many aspects of developing and implementing a fault tolerant warehouse management system ERP integration strategy but the focus of the post is to look at the basic strategies employed by WMS providers.
The three main warehouse management system ERP integration strategies are:
- Loosely Integrated. The loosely integrated concept is quite common in most WMS solutions. The integration strategy allows the user to import and export information between the two system. The integration is “loose” because it requires a considerable amount of manual processing and oversight. The advantage to this strategy is that it provides a generic integration into ERP applications that may not typically be supported by the leading WMS providers.
- Tightly Integrated, Tightly Coupled. This warehouse management system ERP strategy is often referred to as an embedded solution. The integration is tight because the updates between the two applications are automated and trustworthy. The “coupling” between the two systems is “tight” because the WMS is typically developed using the tools provided by the ERP application. The advantage to this strategy is that the user interface is consistent and there is only one database to maintain. The downside is that if the ERP server or system environment fails, both the front office and warehouse operations experience downtime.
- Tightly Integrated, Loosely Coupled. In this strategy, the integration is still automated and trustworthy. However, the coupling is detached (or loose) enabling the two system to function independently from each other. While there are two user interfaces and separate databases, the strategy employs a level of fault tolerance. If the ERP system fails, the warehouse can continue to function and vice versa.
Recently a Savant Software customer upgraded their ERP application. After considerable testing they estimated that their ERP upgrade would take about two hours. Unfortunately, they encountered a critical error and the ERP system was down for almost two days. With Savant’s tightly integrated, loosely coupled warehouse management ERP integration strategy, the warehouse remained operational and could continue shipping orders to customers during the ERP system downtime.
As you can see from the previous story, selecting a warehouse management system ERP integration strategy can have a significant impact on your business. Take the time to weight the pros and cons of each strategy to find the one that optimizes your business goals.