Other Voices: Lessons from WMS in the Cloud

Editor’s note: The following column by Dan Gilmore, chief marketing officer, Softeon, is part of Modern’s Other Voices column, a series featuring ideas, opinions and insights from end-users, analysts, systems integrators and OEMs. Click here to learn about submitting a column for consideration.

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Warehouse Management Systems (WMS) were late to move to the Cloud for a variety of reasons. Those include the existing business models of some WMS providers, and concerns about response times for time-sensitive distribution processes such as RF and voice communication, or messaging to high-speed materials handling systems and more. The good news: those barriers have fallen, and the adoption rate for WMS in the Cloud is rising rapidly as a percent of total new deployments.

Recently, the analysts at Gartner predicted that by 2020 over 90% of new spending on supply chain execution systems (which includes WMS) will be for Cloud-based solutions.

That may turn out just a bit too aggressive, but this is clearly the trend. Though still not for all companies, Cloud is rapidly gaining share in WMS as it is with all other supply chain software categories.

Why? Because Cloud deployments offer a number of benefits versus traditional “on-premise” deployments. Those include:
● Lower upfront costs
● Lower total cost implementations
● More rapid time to value
● Lower IT costs over time
● Easy software portability

The industry now has several years and dozens if not hundreds of implementations of WMS in the Cloud, and the results are positive.

Here are some of the lessons learned from these examples:

Concerns about response times for RF, materials handling, etc. are very overblown. Softeon has seen almost no issues in this area, as bandwidth continues to improve. Local software “agents” can be used to address any latency issues.

That said, using simulation prior to go-live is recommended to achieve certainty. Tools are available to simulate, for example, WMS response times coming from the Cloud for message requests from material handling systems to gauge system performance.

Interestingly, even when multi-tenant deployment offerings are available, nearly all companies prefer a private Cloud deployment. They are likely to have multiple of their own sites running under one WMS Cloud “instance,” but most companies don’t want to share their WMS server in the Cloud with others.

The deployment benefits are real. We estimate that implementation times for Cloud deployments are 25-30% faster than for comparable on-premise deployments, reducing costs and accelerating time to value.

Internal IT resources needed for deployment and on-going system WMS maintenance are reduced dramatically with Cloud implementations, on the maintenance side down to almost no requirements in many cases, as company’s leverage the WMS vendor’s managed services. This greatly reduces total cost of ownership over time.

Along the same line, companies are pleased with how easy it is to set up test or development instances of the WMS in the Cloud versus the effort often seen to do so with traditional internal on-premise deployments.

For a variety of reasons, some companies with multiple sites – for now at least – will opt for a hybrid approach, with most sites in the Cloud but some being deployed on-premise, usually due to bandwidth concerns.

However, if the path is made easy and attractive, many companies will in fact move existing on-premise WMS deployments to a Cloud-based system when confident of the performance.

WMS was certainly late to the Cloud party, but the barriers are falling, adoption rates are growing rapidly, and experience has shown most of the barriers to WMS in the Cloud have fallen away, while the benefits are very real.