12 Order Fulfillment Along the Supply Chain

Warehousing and Inventory Management Improvements

A popular EC inventory management solution is a warehouse management system (WMS). On the surface, WMS refers to a software system that helps in managing warehouses. Behinds the scenes, any market leading WMS provides:

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  Inbound functions such as yard manage- ment, appointment scheduling, multi-method
  

receiving, cross-docking, put-to store, quality assurance, staging, and put-away

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  Inventory functions such as inventory visi- bility, lot-serial control, multi-level holds, counts, replenishments, value-added services (VAS) processing, work order processing, internationalization, and slotting
  
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  Resource management such as dynamic pick location assignment, equipment utilization, facility utilization, task management, automa- tion interfaces, and workforce management
  
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  Outbound functions such as shipment order management, multi-method order picking, retail in-store and dark-store picking and pro- cessing of e-commerce orders, cartonization, shipping and parcel manifesting, sequenced staging and loading, and compliant shipping documents.
  
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  3PL/divisional support such as multi-client architecture, client billing, client-based pro- cess modeling, cross-client optimization, cli- ent visibility and reporting
  

See, for example, jda.com for a description of the detailed capabilities of a WMS.
A WMS is useful in reducing inventories and decreasing the number of out-of-stock incidents. Such systems also are useful in maintaining an inventory of repair items so repairs can be expe- dited; picking items out of storage bins in the warehouse; receiving items at the receiving docks; and automating the warehouse operations. For example, introducing a make-to-order production process and providing timely and accurate demand information to suppliers can minimize inventories and out-of-stock incidents. In some instances, the ultimate inventory improvement is to have no inventory at all; for products that can be digitized (e.g., software), order fulfillment can be instantaneous and can eliminate the need for inventory.