Five Reasons to Adopt Smart Warehouse Management

Technology is getting smarter all the time, and the solutions in your warehouse should not be an exception.

Instead of relying on paper tools and spreadsheets you update manually, take a page from the Scarecrow’s book, and give your warehouse a brain. The modern, smart warehouse management system (WMS) is often the best option because it can leverage the data and connectivity already available in most supply chain, e-commerce, and order management tools.

Adopting a smart WMS is about upgrading to unlock your full warehouse potential, while protecting revenue and customer satisfaction.

What is a smart warehouse management system?

A warehouse management system (WMS) is a piece of software that helps companies manage their inventory and supply chain. It covers everything from tracking levels and creating restock orders to managing docks for inbound and outbound shipments to how and where goods are stored so they can fill orders. Everything that happens with inventory in your facility can be covered by a WMS.

The “smart” aspect of a smart warehouse management system is the reliance on AI, machine learning, advanced sensors, and other newer technologies designed to automate and optimize warehouse operations.

Instead of needing people to perform data entry or make repeat decisions, the WMS’ modules tackle various tasks. These can range from optimizing storage locations to minimize how far people walk to pick orders to supporting robotic arms to perform many tasks. 

Early entrants into the smart WMS space focused on carrier selection for orders, so that companies would automatically choose the most affordable option that still gets the order to the customer within a guaranteed time. AI’s involvement took those pre-defined rules and selections and reaffirmed or changed selections based on the actual performance of carriers to deliver items on time.

There are several reasons why a company might choose to use a smart warehouse management system instead of a traditional one. Let’s look briefly at five of the most important.

1. Adaptation is immediate

Typically, a smart WMS is connected to a broad range of data sources and nearly every activity that happens in your warehouse. When it indicates an area for change or identifies a way to optimize your warehouse, it can execute those changes immediately.

So, your entire system adapts in real-time, such as determining that there’s a new “hot item” and deciding to store it close to packaging stations. When the system wants to take an action that you allow, it happens at the speed of your data.

2. Speed up fulfillment

AI solutions can routinely speed up the fulfillment process and address new delays as they occur. This works at every stage of the order. Smart systems can immediately move orders to the next step as soon as they arrive. At the same time, it can switch pickers from individual order picking to batch or wave picking.

Those processes often speed up the picking process if your order volume is high and inventory is staged for this. AI tools can not only make the decision about when to make this switch, but also ensure that inventory is shelved to make this possible.

3. Track the entire journey

One of the core benefits of a smart warehouse management system is the ability to track data across the life of a SKU or shipment. When integrated with partner data — becoming ever easier thanks to the adoption of APIs and EDIs — AI can monitor how inventory is ordered, delivered, used, and sent to customers. Understanding each stage in these processes as well as the entire process makes it easier to understand complex things like the the total cost to deliver an order. You’re in a better position to eliminate waste, make improvements, and assess your partners throughout the supply chain.

4. Improve forecasts with more data

It is difficult for humans to analyze the data around inventory utilization and the tracking across the entire journey and add in historical sales trends. Smart tools like AI can help review all this information and present highlights in dashboards for sales and operational leads.

Leveraging this full collection of data can help companies make decisions around seasonal trends while adapting for the current year’s trends.

Forecasting has been especially difficult in recent years, highlighting the need to adapt quickly to trends. This could help companies prevent buying too much or too little inventory, a major issue in 2022.

Deliver custom communications

For the warehouse, AI and machine learning tools make it easy to deliver the right message to the correct person. These solutions will know who can help with which alert. So, pickers get notifications about the specific orders they have.

Maintenance staff can get help with notices about equipment issues, printers running out of labels, and other technical needs. Managers can get notices about workforce requirements and overtime. And operational leads will see warehouse-wide notices such as temperature and humidity checks, electricity usage, and more.

Don’t neglect WMS requirements

The smart warehouse management system requires a flood of information at any given point for nearly every warehouse process. The more you can feed it, the better it will help you with workforce, inventory, fulfillment, planning, and partner activities. There’s a lot of groundwork in linking all those data sources and ensuring the warehouse has IoT devices and Wi-Fi coverage.

Using a smart WMS requires that you be smart about building out the budget for requirements and infrastructure beyond the cost of the WMS itself. Thankfully, it’s easy to generate a positive ROI when your WMS starts improving fulfillment speeds and optimizing restocking levels to reduce the amount of capital tied up in inventory.