Implementing Oracle Warehouse

Management System (WMS) in a Supply

Chain of Manufacturing Plants and
Distribution Warehouses

Author: Jaidev Desai

Company: Wipro Technologies
 Jaidev Desai
Governor’s Ballroom A/E
12:15pm – 1:15 pm
Thursday
Objective

• Present the audience with design considerations,

solutions and nuances of implementing Oracle
Warehouse Management System (WMS) in a supply
chain of Manufacturing Plants and Distribution
Warehouses
• Speaker : Jaidev Desai
• Sr. Consultant- Oracle Applications, Wipro
Technologies
• 11 years of experience in implementing ERP and
business solutions in the Distribution/Planning
domains
• Extensive experience in Manufacturing
• Experienced in implementing business solutions in
Distribution Domain using products like Oracle
Applications and BaaN

• Approximate Duration of this presentation : 90 minutes

Agenda
• Introduction
• The Customer
• Highlights of the WMS Implementation
• Design Consideration for Oracle WMS in
• Discrete Manufacturing Environment
• Finished Goods Warehouse
• Cross Dock Facility
• Supply Chain of Manufacturing Plants and Warehouses
• Sub-Ledger Level Accounting (Cost Groups)
• Transaction Based Labeling
• Optimization of the transactional processes
• Challenges
Introduction

• This presentation/paper is a brief discussion on

• Design consideration while implementing Oracle Warehouse
Management System(WMS) in a supply chain of manufacturing
plants and distribution warehouses.
• Benefits that the customer has derived from the solution
• Challenges

• Oracle’s E-Business Suite (11.5.9) was leveraged to deliver the

solution for the customer.
The Customer
• The parent organization is a $16B US global conglomerate with
marketing presence in more than 150 countries.
• The range of products & services include Industrial Automation, Tools
& Equipments, Electric Motors, Compressors, Instrumentation and
Control devices, process and performance control systems, climate
control technologies, reliable power technologies & storage solutions.
• The customer is the worlds leading electrical motor manufacturer in the
world, producing more than 330,000 motors every day (From motors
that drive consumer appliances to those that power large industrial
machinery)
• The Customer went ‘Live’ with WMS (11.5.9) in April 2004 and has had
subsequent rollouts of Plants and Warehouses since then.
Highlights of the WMS Implementation
• Manufacturing & Distribution operations spread across 3 continents
• 6 Manufacturing plants (all WMS-enabled)
• 21 Warehouses (of which 9 Warehouses were WMS –enabled)
• Approx User base: 150
• Approx. 14000 Unique Lot-Controlled Finished Goods
• Integration to 3rd Party Label Printing Software
• Distributed MSCA Architecture for Load balancing
• Use of Bar Code Scanners, RF Scanners and PC Scanners
• Rule-based Label printing (pallet labels, Customer specific labels,
shipping labels)
Design Consideration for Oracle WMS in
Discrete Manufacturing
• High Level Requirements
• Real-time Inventory information
• Enablers were the RF Scanners, PC Scanners, Bar coded
Labels, Label Printers, MWA Server, DFI Mapping
• Ease of conducting inventory transactions throughout the
manufacturing facility
• Enablers were
• Bar Coded Labels
• Custom Reports (Bar Coded)
• Simple processes of Inbound, Manufacturing and Outbound
• Ability to generate labels as the transaction occurs
• Enablers were the Label Format, Oracle WMS Rules and 3rd
party Software
Design Consideration for Oracle WMS in
Discrete Manufacturing

• High Level Solution

• Inbound Process
• 3 sub-processes
• Purchase Order Receipts
• Receipts against Internal Shipments (inter-plant for
Transfer parts)
• RMA (Customer Returns)
Assign Suggested Put Away
Express Receive Put away
LPN
Cost Group Assignment
PO Receipt Label

WMS Rules
Design Consideration for Oracle WMS in
Discrete Manufacturing

• High Level Solution

• Manufacturing Process
• Discrete Jobs Released from MRP
• Custom Reports Developed to ‘Release’ Jobs onto the Floor
• WIP Orders transacted (Move orders & Completions) using PC
Scanners/RF (with use of Custom Bar Coded Reports/Labels)
• Each Palette was mapped as an LPN and Lot
• Use of Lot Statuses (Quality Initiative)
• Job Completion Label* triggered by the WIP Completion
transactions
* - Labeling Detail to follow
Design Consideration for Oracle WMS in
Discrete Manufacturing

• High Level Solution

• Outbound Process at the Plant
• Custom Reports were developed to give visibility to the
Scheduled Orders (Internal Sales Orders and Customer
Orders)
• LPN triggered shipping - Mapping of the Direct Ship
Functionality in Oracle
• Transactions of Direct Ship at some plants done using a ‘tear’
off portion of the ‘Job Completion’ Label
• Automatic Triggering of the Bill of Lading, Packing List and
Shipping Label.
Design Consideration for Oracle WMS in
Discrete Manufacturing

• Benefits
• Accuracy, Control and Ease of transactions at the plants
• The Custom Reports developed for the customer, have further
streamlined the process of manufacturing and shipping
• Transaction-based Labeling has resulting in better tracking of
inventory within the plant and further on in the supply chain
• Quality Initiative mapped in Oracle Applications via the use of
Material Status Control has complimented the customer’s efforts in
Quality.
Design Consideration for Oracle WMS in
a Finished Goods Warehouse
• High Level Requirements
• Real-time Inventory information
• Customer Compliance Labeling *
• Consolidate Shipments in the Outbound process
• System guided Picking Rules *
• Quality Control initiatives

*- Covered in subsequent sections

Design Consideration for Oracle WMS in
a Finished Goods Warehouse
• Outbound Process
• Combination of Pick Release Waves and Manual Assignment of
Sales Order Lines to form Deliveries
• ‘Custom Pick Slips’, that were bar-coded with the Task IDs. This
allowed the pickers to Scan the Task Ids and assign the tasks
manually
• More on the picking rules in the section marked “Optimization of the transactional processes” ”
Assign Assign
Create Tasks Tasks Ship Confirm
Select SO Lines Pick Release Waves (manually) (manually) Pick/Stage
Deliveries

WMS WMS
Picking Label
Strategy/ Printing
Rules
Design Consideration for Oracle WMS in
a Finished Goods Warehouse
• Benefits
• With the use of “Express Receipts”, the process of Receipts in the
warehouses was quick. As the incoming Shipments had LPNs,
hence, the Express Receipts processed a Receipt for all LPNs
within a delivery in a single transaction.
• The Quality Control Initiatives have been mapped with the use of
Material Status to Control to prevent Inventory to be transacted
(picked) till such time Quality assurance decided the course of
action for the Lot/s of motors.
• Picking Rules optimized to minimize breaking of palette(skids)
Design Consideration for Oracle WMS
for a Cross-Dock Facility
• The customer’s manufacturing
facilities were predominately in CUSTOMER
Mexico. It was important for the Consignment

business to quickly consolidate Regional

Warehouse in
USA- North
Warehouses at
Customer
Locations

the shipments coming in from

multiple manufacturing plants Regional Regional Manufacturing
Plant in China
and “Cross Dock” the same to Warehouse in
USA - West
Warehouse in
USA - Mid West

separate Trucks headed to 6 Regional

Warehouse in
different distributions centers in Cross Docking
Facility in Mexico
USA - South

the United States.

• The solution design for the Manufacturing
Plant - Mexico-
Manufacturing
Plant - Mexico-

transaction system at such a M1 M2

location would focus on speedy

Manufacturing
transactions to ensure that the Plant - Mexico-
M3

shipments reach to the 6

regional distribution centers with
minimal time spent in this cross-
docking facility.
Design Consideration for Oracle WMS
for a Cross-Dock Facility
Solution Implemented
• The Incoming Truck Loads were put away to specific locations in the
warehouse. On an hourly basis the custom ‘open sales order’ report
runs and a matching of the on hand inventory was done using an
Excel Macro. A load sheet was prepared and the LPNs were loaded
onto specific Dock Doors using the “Direct Ship” functionality in
Oracle WMS.

• A ‘Customized’ Internal Packing List is generated per Delivery. This

report was a custom report, that has detail such as LPN#, Lot, Item,
Quantity and Delivery #. Most of the Data was Bar-coded, so the
onward Warehouse in the US could receive this with ease.
Design Consideration for Oracle WMS in
a Supply Chain of Manufacturing Plants
and Warehouses
• The Customer has a complex logistics network between the
Manufacturing plants (primarily in Mexico) and across the Warehouses
in the United States. At any given time, there are large amounts of
Inventory that resides in-transit, hence, the tracking of inventory (both
across the supply chain and in transit) in terms of Lot/LPN #s becomes
important to the business.
Solution Implemented
• Custom Reports were developed for the customer, thereby giving him
the ability to track LPNs/Lots that were in transit. Custom Reports were
made for Cost Accounts as well to track the Dollars Amounts that were
in transit.
Design Considerations for Sub-Ledger
level accounting (Cost Groups)

• High Level Requirements

• The customer’s financial controllers needed to have visibility to the
inventory valuation at the sub-ledger of the Raw materials, Sub-
assembly and Finished product that each plant held.

• At the Warehouses, the Business operated under multiple business

divisions, The financial controllers needed the visibility (at sub
ledger level) of the inventory in dollar terms that belonged to each
business division. The Finished Goods Warehouses were a shared
facility to store and handle the inventory of the multiple business
divisions. Within the warehouses, there was no storage space
segregation based on the business division.
Design Considerations for Sub-Ledger
level accounting (Cost Groups)
Solution Implemented at the Manufacturing Plants
• Separate Cost Groups were defined to represent the Accounts that
mapped to
• Raw Material (RAW)
• Sub-Assembly (WIP)
• Finished Goods (FG)
The above was done at individual manufacturing plants.

• A Category Set was identified that has the categories values of ‘RAW’,
‘WIP’ and ‘FG’
• As a process, each item was linked to one of the above categories,
depending on whether the item was a Raw Material (RAW) or
Subassembly (WIP) or Finished Good (FG).
• WMS Cost Group Rules were written to tie the Cost Group to the
Categories.
Design Considerations for Sub-Ledger
level accounting (Cost Groups)
Solution Implemented at the FG Warehouses
• Separate Cost Groups were defined, that held account values mapped
to individual business divisions.

• A Category set was defined that held category values of the individual
business division.

• Each finished Goods was assigned to one Business Division.

• WMS Cost Group Rules were used to tie the business division category
to the cost groups.
Design Considerations for Sub-Ledger
level accounting (Cost Groups)
Benefits

• Optimal Space utilization: At the plants, there was no need to define

subinventory based on the classification of items such as Raw
Materials or Finished Goods. Regardless of which
location/subinventory the item was stocked in, the valuation of the
inventory was always derived from the WMS Cost Group Rule. The
benefit was identical in the Finished Goods warehouse. By using WMS
Cost Group Rules, there was no need to allocate space for inventory of
separate business divisions.

• Kept the Cost Accounts/Financial Controllers happy – they were able to

query on the inventory dollars and gain access to information (Inventory
valuation by Division or classification immediately (at the sub-ledger
level)
Transaction-based Labeling
Transaction based labeling is usually a very important consideration to
enable WMS within an inventory organization.
The following transactions were enabled to print labels automatically
• Purchase Order Receipts: The Label was configured to print at the
time of a Receipt. The label format contained bar coded information of
the LPN, Purchase Order Number, Supplier and Item. This Label
serves as an enabler for subsequent transactions, such as “put-away”
and “inventory moves”.
• Job Completion: The Label was configured to print, when the operator
on the manufacturer line posts a ‘job completion’ of a Palette (Skid) of
Motors in Oracle. The label format prints bar coded information of the
LPN, Item Number, Customer Item Number and Lot Number. The label
is then pasted onto the Pallet/Skid. The label serves as an enabler to
transact subsequent transactions across the entire supply chain of
warehouses and then onto the end warehouse.
Transaction-based Labeling
• Shipping Confirm: These labels were triggered when the
Shipping Clerk completes a ‘Ship’ transaction in Oracle. The
Shipping Labels containing customer information, shipping
instructions, Customer Purchase Order, Customer Part Number
and Quantity. These labels would reflect information that would be
important for the end customer of these motors.

Solution Implemented
• Individual Labels were designed in the 3rd Party Labeling Software
The Label Formats were defined with the Oracle provided data
fields and mapped appropriately with the fields Labels in the
labeling software. The Individual Labels were then tied to the
Business flows such as “PO Receipts”, “(Job) WIP Completion”
and “Ship Confirm”.
• The Users were mapped to the appropriate printers.
Transaction-based Labeling

Benefits
• As the labels were Bar Coded and hence they complimented the
Scanning process. The customer derived huge benefit in terms of
transaction accuracy and transaction speed.
• The “Job Completion” Labeling helped to track and transact the
specific Lot/LPN through the Supply Chain. The label help facilitate
counting activity within the Finished Goods Warehouse.
• The Shipping Labels were almost a requirement. As the end customer
wanted the relevant information, such as Purchase Order #, Customer
Part #, etc, to be visible on the label (that was stuck to each palette
(skid))
Optimization of the transactional
processes
Picking Rules - Requirements
• The Company’s corporate directive was to ensure, there was FIFO
(First-in First –out) logic built into the picking rules.
• The warehouse managers wanted to ensure, that the picking rules
would ensure, there was minimal breaking of a full palettes (skids)
to fulfill a pick quantity.
The Solution*
• The solution was to build multiple Pick Strategies
• The strategy were then prioritized as follows (highest to the lowest)
• Consumption of the entire LPN with a sort on LPN numbers
• Lot Consistency Rule with a sort on LPN numbers
• FIFO (First –in –First Out)
* The above sequence of WMS Picking Strategy was implemented at 2 of the largest
warehouse of the customer
Challenges

• Organizational Challenges
• Transactions move from the office to the floor for receipts, staging,
moves and ship confirm using handheld devices.

• Complexity and volume of transactions makes barcode scanning a

requirement in many warehouses (introduction of technology).

• Transaction triggered Labeling meant that the Printing Setup –

Printers, Software Licenses had to be installed at all the sites.
Challenges

• Process changes for the Logistics Function

• Warehouse gets ownership and responsibility for releasing orders
based on scheduled orders.
• Use of License Plate Numbers (LPN #s) brings in more control.
• Intelligent lot #s replaced by non-intelligent lot#s and LPN #s.
• Support for Staging shipments within system. This meant, there
was more control on the inventory transactions.
• Two Part Scan: The customer had warehouses that had up to 5
levels to stock palettes (skids). There were 4 segments used in the
stock Locator. By implementing a 2-part scan there was a reduction
in scanning errors.
Questions/ Comments

You could write to jaidev.desai@wipro.com

www.wipro.com
Thank You