What is SAP Extended Warehouse Management?
SAP EWM stands for ‘Extended Warehouse Management’. It is a software product used for controlling the warehouse processes and managing the movements of goods in the warehouse. It is one of the best warehouse management solutions designed to manage and track logistics in the market.
SAP Extended Warehouse Management is a software product that allows companies to receive and send goods out of their warehouses or distribution centers. It helps to manage the storage and manage the goods movements. The main processes supported by SAP Extended Warehouse Management are inbound and outbound processes. The inbound processes support the good receipts of purchased goods, raw materials and customer returns. The outbound process supports the shipment of finish goods to customers. It also supports the shipment of components or raw materials to other inter-company locations.
Inbound process involves storage of goods in warehouse in their location and Outbound process involves picking up the goods and shipping them to customers. Materials are stored in storage bins.
With the help of SAP EWM all the goods movement are controlled by a warehouse management system and provides you the tools to monitor warehouse activities. You can also manage additional functions in the warehouse such as creating a serial number, batch numbers, vendor management inventory, resource optimization and value-added services. SAP Extended Warehouse Management allows you to not only monitor the quantity of goods in Warehouse but to manage other critical functions and delivery of goods efficiently.
SAP Warehouse Management is opposite to Inventory management. Inventory management tells the count of goods in the storage location and its physical location is unknown. Warehouse management deals with goods movement and monitoring the physical location of the goods as recorded with specific documents.
SAP ERP Warehouse Management and SAP Extended Warehouse Management – SAP EWM – History
As you can see in the chart, SAP introduced “Storage Units” and “Parallel Processing in 1993 in SAP R/3 Release 2.0 and 2.1. On the late 1990s, SAP introduced “Decentralized Warehouse Management” in SAP R/3 Release 4.5. “SAP Lean Warehouse” was introduced in SAP R/3 Release 4.7. In “SAP Lean Warehouse”, the inventory management takes place solely at storage location level. The system does not update the stock data at storage bin. You use Lean WM for processing goods receipts and goods issues. When you use Lean WM, you process the warehouse movements in basically the same way as if using the Warehouse Management System: you work with deliveries, and you create transfer orders for these deliveries. These transfer orders serve as pick lists.
SAP introduced “SAP Extended Warehouse Management – EWM” in 2006 with SAP EWM 5.0. Some of the early functionality of SAP EWM was Slotting, Warehouse Orders and Warehouse Monitoring. The latest version of SAP EWM is 9.3 and it was introduced in 2015.
Advanced Warehouse Processes and Benefits: Examples of advanced warehouse processes are Labor Management, Catch Weight Management – enables you to record weight while performing other warehouse tasks, yard management – enables to load and unload trucks, placement and removal strategies, replenishment, pick logic, value added services, opportunistic cross docking, dynamic cycle counting, slotting - slotting is the process of allocating product, (SKU’s), to locations in the Warehouse according to business rules and product characteristics and deconsolidation.
Features and Benefits: SAP EWM also helps the firms in keeping the inventory levels accurate with the use of Physical Inventory functionalities. SAP EWM can help companies to reduced labor cost, better customer service and flexible modeling of warehouse processes.
Planning: The Wave Functionality helps in planning and executing the picking activity. It can be setup to automatically releasing waves per wave templates which leads to the creation of tasks in the system. SAP EWM also has Labor Demand Planning that can forecast workload helping reduce labor shortages. Another planning tool is the Dock Appointment Scheduling which is a planning tool for loading and unloading appointments.
Logistics Monitoring and Reporting: SAP EWM has a Warehouse Monitor that helps supervisors to monitor the warehouse activities and maximize warehouse efficiency. The Warehouse Monitor tracks open deliveries, unconfirmed transfer orders, stock in final/intermediate bins, cross docking and wave picking.
SAP EWM Deployment Options: The deployment of SAP EWM can be either centralized or decentralized. The centralized option allows the installation of SAP EWM on the same server where SAP ERP runs. With S/4HANA the centralized option is called embedded. With the 1610 release, SAP EWM was offered as an embedded application component. There are two versions of the embedded option. There is a Basic and Advanced Embedded version. The Basic Embedded EWM functionality is included in the license cost of SAP S/4HANA. Companies need to incur additional license costs for the Advanced Embedded version. The Advanced Embedded version reduces the need for data replication. The Business Partner, Material Master, Batch Master Data does not need to be replicated as it exists within SAP S/4HANA itself. In decentralized deployment option, SAP EWM is deployed on a separate server platform and connected to SAP S/4 HANA using Remote Function calls and CIF. The biggest benefit of the decentralized option is that SAP EWM can keep running even if the ERP system goes down.
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