Warehousing and distribution (W&D) systems play a key role in procurement and supply chain management systems (see Figure). Inventory management and shipping/receiving are the two major business processes of W&D. These systems have played a central role in the evolution of ERP systems. The focus of manufacturing systems in the 1960s was on inventory control. Most of the software packages then (usually customized) were designed to handle inventory based on traditional inventory concepts. In the 1970s the focus shifted to MRP (Material Requirement Planning) systems which tied inventories to materials planning (i.e., the material suppliers were connected to the inventory systems to keep inventories at acceptable levels). In the 1980s, the concept of MRP-II (Manufacturing Resources Planning) evolved which extended MRP to shop floor and distribution management activities (i.e., the inventories were also connected to shop floor systems and distribution channels to take advantage of quantity discounts and fulfill just in time inventories). In the early 1990s, MRP-II was further extended to cover areas like Engineering, Finance, Human Resources, Projects Management, etc., i.e., the complete gamut of activities associated with all enterprise resources. Hence, the term ERP (Enterprise Resource Planning) was coined.
The main business processes belonging to W&D systems are:
Related business processes are:
Common Automation Strategy: Use ERP packages that handle inventory, shipping, procurement and supply chain activities.