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Dynamics AX Updates

AX Warehouse Management Strategies in AX 2012

Several options for AX warehouse management are available within the most recent version of Microsoft Dynamics AX 2012 R3. The 2 major options represent the basic approach and the advanced approach. For some firms, the key question includes which option is best for my operation?  A related question includes the strategic options, especially those supporting an evolving strategy of starting simple and growing into more advanced usage.

Strategic Options and Illustrative Case Studies

The strategic options for Microsoft Dynamics AX warehouse management go beyond the choice of one approach or the other. For example, the choice of an approach can be AX warehouse management specific. In addition, the key question often includes what are the strategic options for starting with basic capabilities and evolving into more advanced capabilities?  The flexibility can be considered within each of the 2 major approaches, and from one approach to the other.

As the explanatory approach, it is easiest to consider the various strategic options in terms of illustrative case studies.  Illustrative case studies are summarized in Figure 2.2 and explained further in a subsequent section.  The numbered case studies are superimposed on the above diagram about major options, and the arrows indicate the applicable option.  These do not necessarily reflect the exhaustive list of the strategic options.

Evolving Strategies for Strategic Options

The flexibility can be considered within each of the 2 major approaches, and from 1 approach to the other.  As one example of an evolving strategy within the Advanced AX warehouse management approach, a given warehouse may start with the simplest use of mobile device transactions and the advanced functionality and then evolve to fully utilize them and to fully use the advanced transportation management capabilities.  As an example of the Basic Inventory approach, a given warehouse may start without using the Inventory Status capabilities (Case 6) and then evolve to fully utilize the capabilities (Case 7).

A given warehouse may also start with the basic AX warehouse management approach as an interim step to the advanced approach (Case 5).  Even when the primary warehouses employ the advanced approach, a basic approach is required for managing inventory at off-site warehouses such as subcontractors or remote locations (Case 4).  Finally, a firm with simplistic needs for AX warehouse management can start with out-of-the-box functionality in the basic approach (Case 8), then selectively develop custom solutions built on the basic approach (Case 9) and also support mobile device transactions via 3rd-party applications (Case 10).

Details of Case Studies

This section gives more details about each case study.

Case 1: Simplest use of the Mobile Device Transactions and the Advanced WMS functionality

The implementation project team at a manufacturer/distributor wanted to implement the Advanced WMS approach as simple as possible, and then evolve into more sophisticated usage as needed.  They considered several options for the simplified usage at their main warehouses, adding the following.

  • Minimum scope for advanced functionality.  The minimum scope can start with just the basic inventory transactions and the basic processes for handling purchase receipts and the order-based picking for sales orders and transfer orders.  It does not need to add the many aspects of more advanced functionality, such as load planning, manual packing or the replenishment of picking locations.
  • Minimum scope for using mobile device transactions.  The minimum scope can start with just the mobile device transactions for the above-mentioned basic inventory transactions and basic business processes.  The related putaway transactions for receipts of purchases and transfers can be user-directed.  The logic for suggested putaway locations can be added later.  The detailed design of interacting with mobile devices can reflect simplistic out-of-the-box capabilities.
  • Minimal tracking of inventory by License Plate IDs.  The minimum scope can start with minimal tracking and the use of license plate IDs.  Minimal tracking reflects the use of the inventory locations designated as “not license plate controlled”, and the related use of putaway transactions into these locations.  The minimal tracking can apply to selected locations (such as production floor stock) or to almost every location.
  • Minimum scope for advanced transportation capabilities.  The minimum scope can start without using the capabilities for the advanced transportation management.  These capabilities can be phased in at a later date.
  • A single value for Inventory Status.  The minimum scope can start with a single value of Available as the default value for all possible transactions.  Additional values and their impact on the business processes can be phased in at a later date.

The implementation project team was also considering some of the simplifying ideas presented at one of the sessions during the 2015 AX Technical Conference.  Some of these ideas included a combination of basic and advanced approaches.

Case 2: Fully use the Mobile Device Transactions and the Advanced WMS functionality

A manufacturing company fully utilized the mobile device transactions and the functionality within the Advanced WMS approach.  The mobile device transactions were used at every possible step in each business process, and the detailed design of the interacting with the mobile device was tailored to their operation and warehouse personnel.  They were not ready for any of the advanced transportation management capabilities.

Case 3: Use the Advanced Transportation Management capabilities

A manufacturing company used the Advanced AX warehouse management approach at their key warehouses to identify and manage outbound loads (for sales orders and transfer orders) and inbound loads (for purchase orders) and used this load data for transportation management purposes.  This included the assignment of rates and routes to inbound and outbound loads, the scheduling and reporting of transportation appointments for inbound and outbound docks, and performing freight entry and reconciliation.

Case 4: Manage Inventory at Off-site Warehouses

A manufacturer/distributor employed the Advanced AX warehouse management functionality and mobile device transactions at their main warehouse.  However, they also needed to track inventory and report transactions at their off-site warehouses that represented subcontractors and remote locations.  They used the inventory transactions for many situations, such as reporting purchase order receipts of supplied material at a subcontractor or transfer order receipts at a remote warehouse.  In some situations, they selectively employed capabilities within the Basic Inventory approach, such as picking lists for all sales order shipments from a subcontractor or remote warehouse.

Case 5: Interim Step to using the Advanced WMS approach

A manufacturer/distributor was implementing AX with a two-phased approach for AX warehouse management.  For Phase 1, they employed the Basic Inventory approach, which would serve as a step before implementing the Advanced WMS approach.  More specifically, they defined the items as the WMS-enabled and initially defined non-WMS warehouses and their locations.  For Phase 2, they would define another set of the WMS-enabled warehouses with the exact same location identifiers.  When cutting over to Phase 2, inventory in their warehouses will be transferred to the corresponding WMS-enabled warehouse and location, and also assigned to the relevant license plate ID.  In addition, the demands and the supply orders would be updated to reflect the change to WMS-enabled warehouses.

Case 6: Not yet ready for the Inventory Status capabilities

A manufacturing/distribution company was implementing AX warehouse management in a short time frame and did not want any additional complexities that would delay the cutover.  In terms of using different values of the Inventory Status, they were not ready to think through the potential impacts on all business processes. They defined the single value of Available and assigned it as the default for all possible transactions.  They planned to revisit the use of Inventory Status after the initial cutover.

Case 7: Fully Utilize the Inventory Status capabilities

A manufacturing company identified multiple values for the Inventory Status in order to help requirements for quality, warehousing, and sales. The use of the Inventory Status was fully integrated into the business processes for receiving purchase orders and the production output. The values indicating needed action given the basis for performing follow-up actions.  Different sales pricing was defined as off-spec material.

Case 8: Simplistic Needs for Warehouse Transactions

A manufacturing and distribution company had needs for warehouse transactions.  They implemented the Basic Inventory approach at the various warehouses since they did not require the extra functionality within the Advanced WMS approach.  In addition, they were happy with the screen-based approaches for entering the warehouse transactions and did not yet perceive a need for information collection via mobile devices.

Case 9: Custom Solution built on Basic Approach

A manufacturing and distribution company had needs for warehouse transactions and were implementing the Basic Inventory approach because they did not require the additional functionality within the advanced approach.  For example, they employed order-based picking for sales orders and transfer orders and used the Picking Workbench to support their wave picking requirements.  A few requirements were being addressed by customizations, such as customization to support staging/loading steps prior to sales order shipment.

Case 10: Support Mobile Devices using Third-Party Applications

A manufacturing and distribution company was implementing the Basic Inventory approach (and using Inventory Status) at the various warehouses since they did not require the additional functionality within the Advanced WMS approach.  This meant they could not use the out-of-the-box mobile device transactions, so they employed a third-party solution for these information collection purposes. The solution supported all variations of transactions within the basic approach and given a simpler user interface for the mobile device transactions (relative to the out-of-the-box mobile device transactions).

Case 11: Manage the Project-related Inventory

A project-oriented business implemented the Basic Inventory approach because it did not require the extra functionality within the Advanced WMS approach. In addition, many of their project-related transactions were not supported by the mobile device transactions within the advanced approach.  They are considering the third-party application for helping their mobile device transactions.

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