A successful Warehouse Management System (WMS) implementation can provide an 18-24 month return on investment. A WMS also serves as a foundation for instituting a continuous improvement culture and facilitates on-going annual benefits ranging from 5-10%. For some companies, justification in a WMS is a matter of survival. Having the right material available at the right place and at the right time is no longer enough. In today’s economy potential requirements include:
- Compliance Labeling
- Floor Ready Displays
- Advanced Ship Notices (ASN)
- Light manufacturing
- Unique Customer Demands
- And More!
Leading companies are realizing information has a specific shelf life value that diminishes over time, often by the hour or minute. Many of the processes and activities being managed and monitored by Supply Chain Event Management (SCEM) applications relate directly to warehouse operations. As the focus on SCEM applications continues to grow, the need for real-time activity tracking and inventory visibility offered by a WMS becomes even more critical to your organization.
Regardless of your perceived need for a WMS, an effective campaign to procure and implement a new system could depend on a solid business case. A good business case will include both tangible quantitative dollar justifications and the qualitative, intangible benefits difficult to enumerate. This paper introduces a tool to use when developing a project justification, identifies benefit categories for potential inclusion in the business case, and discusses areas of opportunity within the various benefit categories
A sound business case is critical to obtaining the management and employee support so important to a successful system implementation. The business case will consist of two components;
1) A Financial Business Case
2) Narrative explaining the assumptions behind justification estimates and providing an accurate picture of the intangible benefits.
A business case is a cost/benefit analysis aligning the project goals, costs, and risks to the company’s business objectives and financial expectations. The bottom line, the value of the benefits over the life of the project, normally 3-5 years, should exceed the total investment of the project over the same planning horizon.
This detailed guide will review both the tangible and intangible benefits associated with Warehouse Management Systems in addition to Return On Investment (ROI) financial considerations:
Download the Guide for Considering Warehouse Management Systems: