Ramp-up planning for an enterprise WMS implementation

Launching a new warehouse management system (WMS) can be daunting. From learning the new system to managing all the complex integrations involved, obstacles abound. That’s where ramp-up planning can make a difference. Explore the benefits of a ramp-up plan and the best practices that can help make your WMS implementation smooth and successful.

Why is WMS ramp-up planning needed? What should go into it?

Imagine you want to get your driver’s license. You’ve done all the online training, passed the written tests, and done some driving in a virtual simulator. Your cousin calls you and asks when you’ll be able to drive up to see her in New York from your home in Washington, DC—about a 4-hour drive. You wish you could say “tomorrow” because New York is a great city, but realistically you know that you’d first need to practice in the parking lot, then get some more practice in the neighborhood, then on the streets, and then on the highway before you could take your driving test and pick up your cousin. This is crucial so you don’t rush and put yourself in a potentially dangerous situation!

A WMS go-live ramp-up follows a similar implementation process: users need time to gain hands-on experience of the WMS (transactions and reporting) in small volumes before they can drive at full speed. To make matters more complicated, users and IT teams need to find, report, manage, fix, and retest defects (especially in the first few weeks)—all while trying to meet customer orders.

And unlike driving a car, planning for a WMS go-live ramp-up is a lot more complex. At a high level, the objective is to maximize the order fill rate and ensure customer satisfaction. At a detailed level, there are numerous input variables feeding into this function across people, process, and technology. Examples include, but are not limited to, the complexity of software integrations, level of automation, number of unique processes, and ratio of inexperienced to experienced staff.

From our experience, clients often underestimate the potential points of failure during a go-live and their respective short- and medium-term impacts—not allowing enough time for users to properly learn the system. At best, this lack of WMS planning can lead to a period of extended pain at the facility, characterized by long days, numerous workarounds, high staff turnover, reduced inventory accuracy, and overall poor decision-making. At worst, business continuity can be jeopardized—impacting customers.

Challenges with traditional WMS ramp-up plans

Businesses often set ramp-up plans based on a random point in time at which they want to be back at full capacity (e.g., two weeks or two months post go-live). What’s more, their targets often tend to be more bullish than bearish. What are the risks associated with an overly aggressive or poorly coordinated WMS ramp-up plan?

1. First, no matter how well-trained a team is, using a brand new system in real life always involves a learning curve. The pressure to fill orders and perform replenishments or other transactions at an unrealistic pace could lead users to either bypass the system or use it incorrectly. Old bad habits tend to creep up, and such behavior could create a host of problems—from inventory accuracy issues to more qualitative issues, such as a negative perception of the new system, which can impede productivity gains among staff or—worse—cause employee turnover.
2. Second, software system issues can compound in a similar away. A seemingly harmless defect could potentially prevent thousands of orders from getting shipped out—requiring fixes that could bring even more risks to system stability. Conversely, if the bulk of the major defects are found at lower order volumes, the costs to fix them are significantly reduced. As the saying goes, you must crawl before you can walk!
   

Naturally, the management team expects that the system has been stress-tested and is resilient prior to go-live, that its people are experts in the new software, and any hiccups during or after go-live will be minor and easily addressed. There are certainly scenarios where this could be the case, but given the complexity of WMS go-lives and various potential touchpoints, we advise following an implementation strategy that thoughtfully considers the risks and plans for the time needed for processes to stabilize—realistically estimating the capacity of the site to handle orders in the first few weeks of go-live.

WMS implementation best practices: Coordinate and plan ahead

As one can imagine, supply chain planning and execution touches many different teams, so everything needs to be carefully orchestrated and coordinated in advance. It’s important to have an open line of communication among all the parties involved weeks ahead of the WMS go-live and synchronize on the planning as well as the execution side. It’s about getting the right product to the right place at the right time in the right quantity.

Start with the execution side. For example, given that inbound and put-away processes are often quicker to stabilize than outbound/shipping (which often have many more points of failure and exceptions), a facility has the potential to reach full capacity on the inbound side quicker than on the outbound side. What’s more, while inventory reconciliations are relatively straightforward for some, in facilities with a myriad of variables that underpin an inventory record (expiration dates, lot control, serial numbers, etc.), inventory reconciliations can take a lot longer to reach a stable state.

Figures 1 and 2 provide more detailed views of these points—displaying conservative estimates for the time to reach stability in specific warehousing processes after a WMS go-live, along with a demonstrative WMS go-live ramp-up plan. In addition, estimates are broken down by complexity of the implementation, where we define the base case as a WMS go-live with a low-to-medium number of unique processes and exceptions, and a complex case as an implementation that features a high number of unique processes and exception scenarios.

From our experience, the earlier these projections and constraints are discussed and analyzed among cross-sectional teams from logistics/distribution, demand/supply planning, and customer sales, the better the approach will be for ensuring business continuity. For one, such communication will address any potential need to build up buffer inventory (safety stock) while also informing critical business partners, suppliers, and customers about the upcoming system change.

To expand on this, a business-to-business distribution or consumer packaged goods company may want to stock up on fast-moving stock keeping units and offer incentives for its customers to front-load inventory just prior to the new system going live. This reduces the strain on the system during the first few days and weeks post go-live. A retailer may choose to increase store on backroom shelves to reduce the strain on the distribution center to store. It can also build up additional safety stock in warehouses to ease the load on the inbound side as soon as the new system goes live.

A successful ramp-up equals a satisfied customer

As explained previously, a thoughtful WMS ramp-up plan enables supply chain leaders to effectively communicate with other core partners and coordinate activities to ease the strain on the new system immediately post implementation. More importantly, it gives the business confidence to diligently plan its overall operations and maintain service level agreements with customers.

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