September 20, 2011 // By: Bernhard Müller // A Faster Path to SAP EWM
Aside from independence from the central ERP system, the advantages of a decentralized SAP EWM solution include better scalability, the option of linking to several ERP systems, improved performance, and simpler outsourcing. But, this scenario makes the IT landscape significantly more complex and requires users to work in two different systems.
A central warehouse management system, on the other hand, requires fewer system interfaces and generally incurs lower administrative and hardware costs.
Once installed, the benefits of an SAP EWM solution quickly become evident. Equipped with improved warehouse control functionality, companies can experience reductions in picking errors and inventory costs. They also report higher customer satisfaction levels due to more accurate and punctual deliveries.
Companies considering an SAP EWM implementation should keep in mind that the results of a cost/benefit analysis and ROI calculation will depend on their specific business situation. However, the cost of licenses, new hardware, user training, and software implementation will likely be offset by increased efficiency and transparency, savings that result from replacing legacy systems, and lower maintenance costs achieved by working with a uniform software release.
Because machines lose their “black box” character by being connected up to the warehouse management system (in a technically fairly straightforward process), transparency levels rise and automated processes become easier to monitor and control. The number of error-prone interfaces decreases and, potentially, fewer external service providers are required.
“Hundreds of factors influence the result of a cost/benefit analysis and they need to be investigated in each specific case. But, on average, our experience shows that it is possible to cut previous warehouse costs by about one third,” says Armin Reiss, a senior IT consultant for SCM and logistics solutions at BASF.