The Commonwealth Supply Chain Advisors Blog

Do I really need a Tier 1 WMS? Could a Tier 2 WMS Meet My Requirements?

July 26th, 2012

 

Do you really need a Tier 1 WMS or could a Tier 2 WMS meet your requirements? We asked ourselves this question recently and did a little research to confirm some thoughts Woman in distribution center - Tier 2 WMSthat Commonwealth has had for a while on the subject. Companies that are undertaking a WMS selection project often assume out of the gate that they need a top-tier WMS system and limit their search to a handful of these providers. Make no mistake – many companies with complex distribution needs and high throughput requirements may require a new WMS from a Tier-1 provider. However, for companies with only moderately complex distribution centers, our research showed that the Tier 2 WMS providers have been hard at work in recent years, developing features and functionality that can fill these needs.

 

Commonwealth recently surveyed three Tier 2 WMS providers – two of which offer SaaS WMS systems and one which offers a traditional licensed WMS. (The SaaS model allows companies to avoid an upfront licensing fee and simply pay a monthly usage fee for the software.) We asked them about thirty (30) specific functionality points to see if these were now offered as standard functionality, and – perhaps more importantly – whether they have customers actually using these features and breaking them in.

 

Our research showed that a number of features which were previously unavailable in Tier 2 WMS are now solidly within these providers’ offerings. Some of this functionality includes the ability to cluster pick, the ability to slot the same SKU in multiple locations in the same zone, advanced lot control and serialization, country of origin tracking, advanced replenishment capabilities, and cartonization. There were a few features that are still not well developed by Tier 2 WMS providers such as the ability to perform clustered put-away, task interleaving, and some areas of movable unit tracking.

 

Our key take-away is that companies are properly advised to consider providers from a mix of functionality tiers in their WMS selection projects. The relatively large number of providers and lack of consolidation in the vendor community in the last five years gives companies a wide selection of choices that they should take full advantage of.

 

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6 Responses to “Do I really need a Tier 1 WMS? Could a Tier 2 WMS Meet My Requirements?”

  1. [...] pricier Tier 1 shelf, either. As Ian Hobkirk, of Commonwealth Supply Chain Advisors, notes in his recent blog titled “Do I really need a Tier 1 WMS?,” features which were previously unavailable in mid-tier WMS are now solidly within these providers’ [...]

    • CWSCAadmin says:

      Thanks for featuring this on your own blog Tom! Interesting connection to the Idexx project and FORTE. The value of a strong WCS in supplementing the functionality of a WMS is a story that needs to be told.

  2. Noah Dixon says:

    Every WMS deal should include at least one second tier player if for no other reason than to keep prices honest. Although first tier may have more functionality, second tier is often simpler to use and easier to implement. Making the overall project more affordable and easier to maintain.

  3. Michael says:

    This is a really interesting question…simply becuase the answer is almost always no. One could ask the same of a sports car: Do I really need a Porsche? Need? No! Want? Yes. So the question comes down to what functions & features are most key in each specific implementation:
    – What’s the interface point(s) and how complex are the?
    – How many sites and are the business rules uniform or discreet?
    – Does the system need to support multi-language and multi-currency?
    – What are the support requirements for the implementation? 9×5, 24×7…

    These are all of the considerations that help answer the questions about a tier 1 WMS. What each company needs to do is balance the priority of each of these (and many more) then consider the budget as a driver to help determine what answers can be given the most weight.

    Take all of that aside – go back to the Porsche analogy…no one drives 180MPH unless they take the care to a track and race. Are you going to race your warehouse? Most folks never go above 65 (well – let’s be honest…85) and the same is true for warehouse functionality…many folks NEVER use all of the features that sound so enticing in the sales pitch/demos.

    Folks need to get:
    1) Business functionality replicated (or enhanced)
    2) The system implementated & operational on-time and on-budget
    3) The system supported in a go-live/post-go-live environment

    I would be willing to bet that most initiatives that are “Pushed to Phase 2″ almost never get implemented (not just in WMS projects, but in most software projects).

    All these considerations and more help drive the decision around the required project/product solution

  4. Ian Hobkirk says:

    Well said Michael. You’re the most eloquent CIO I’ve had the pleasure of knowing!! (short list)

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