In our second installment we’ll discuss how WM difers from IM then discuss the various flavors of WM. Adding WM to your environment provides the detailed location stock management that is needed in a typical warehouse/distribution center.  The organizational structure changes in that we have some new organizational objects available to us. See the example below

Example WM structure

When using SAP WM we now have the ability to define storage types (Areas of a warehouse) and bins beneath them, so this provides you the granular detail used in a typical warehouse/distrbution center. SAP WM is setup by linking a storage location to a warehouse structure. The inventory level views available from IM are all still there, the only thing different is that we now have a lower level of detail available as to the inventory’s location (i.e. bin).  The above example shows 2 storage locations being connected to the same warehouse, this is a typical setup but not the only one.  Possible variations include 1 storage location linked to 1 warehouse, 1 warehouse linked to multiple storage locations from different plants etc.., I am sure there are probably other variations but that should get the noggin thinking.

One popular misconception is that if you use SAP WM you will no longer use plain old IM storage locations but this is not necessarily correct, depending on your business processes you will more then likely still have storage locations that are not linked to WM.

Benefits of using WM over IM

Pros

• Detailed location visibility
• Audit trail of movements between bins
• Picking optimization capabilities
• Bin usage optimization (i.e. system directed putaway)
• Capacity management
• Mobile computing (barcode scanning etc) is available out of the box vis SAPconsole

There is one con that I have to mention

• Increased transaction volumnes – every movement requires a transfer order.

If you already have IM in place it’s possible to update to WM at a later date so don’t be to worried that you won’t be able to take advantage of WM capabilities. I’ll give you a quick tip last tip as I am closing this post, if your blueprint or your existing org structure has 10+ storage locations attached to your plant, you probably don’t need to read this, you need WM.

Now that I have given you a brief description of WM and the benefits over IM,  I will break out the various flavors of WM and what the differences are in my next post.

Later