1. Warehouse Management System on RFID
System Integration Development
A thesis
submitted in partial fulfillment
of the requirements for the degree
of
Master in Information Technology
at
Asia Pacific College
by
CHERI AMOUR P. CALICDAN
2013

2. Revision History
Revision Date Revised by Approved by Description of change
Page 2

3. Tables of Contents
Revision History........................................................................................................................2
Tables of Contents.....................................................................................................................3
Introduction................................................................................................................................4
1.0 Project Goal.........................................................................................................................6
2.0 Problem / Opportunity Definition .......................................................................................6
3.0 Proposed Solution................................................................................................................8
4.0 Project Selection and Ranking Criteria................................................................................8
3.1 Project Benefit Category.................................................................................................8
3.2 Project Urgency...............................................................................................................9
5.0 Cost-Benefit Analysis........................................................................................................10
3.3 Tangible Benefits...........................................................................................................10
3.4 Intangible Benefits.........................................................................................................13
3.5 Budget Control Analysis...............................................................................................16
3.6 Financial Return............................................................................................................17
6.0 Business Requirements......................................................................................................21
3.7 Major Project Activities.................................................................................................21
3.8 Out of the scope activities that are critical to the project success ................................24
7.0 Major Obstacles.................................................................................................................24
8.0 Risk....................................................................................................................................24
9.0 Schedule Overview............................................................................................................26
3.9 Major Milestones...........................................................................................................26
3.10 External Milestones Affecting the Project...................................................................26
3.11 Impact of Late Delivery...............................................................................................26
10.0 Estimated Project Completion Date.................................................................................27
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4. Introduction
Supply Chain Management
Supply chain management (SCM) is the term used to describe the management of flow and
storage materials, information, and funds across the entire supply chain, from suppliers to
producers to final assemblers to distribution centers (warehouses and retailers), and
ultimately to the final consumer. In fact, it often includes after-sales service and returns or
recycling.
The product flow includes the movement of goods from suppliers to customers, as well as
any customer returns or service needs. The information flow involves transmitting orders and
updating the status of delivery. The financial flow consists of credit terms, payment
schedules, and consignment and title ownership arrangements. Supply chain management
involves coordinating and integrating these flows both within and among companies.
Warehousing
The warehouse is a point in the logistics system where a firm stores or holds raw materials;
semi finished products, or finished products. By using warehouses, companies can make
goods available "when" and "where" customers demand them.
With the evolution of supply chain philosophies, strategic alliances, just-in-time; the last two
decades have seen a new role for warehousing. Today's warehouse is not a classical
long-term storage facility. Attention is given to the warehouse role in attaining the logistics
goals of shorter cycle time, lower costs, lower inventories, and better customer service.
Warehouses processes are being redesigned to achieve cost and order-processing goals and
are being relocated to achieve overall customer service goals.
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5. Warehouse Management System (WMS)
A warehouse management system, or WMS, is a key part of the supply chain and primarily
aims to control the movement and storage of materials within a warehouse and process the
associated transactions, including shipping, receiving, putaway and picking. The systems also
direct and optimize stock putaway based on real-time information about the status of bin
utilization.
Warehouse management systems often utilize Auto ID Data Capture (AIDC) technology,
such as barcode scanners, mobile computers, wireless LANs and Radio-frequency
identification (RFID) to efficiently monitor the flow of products. Once data has been
collected, there is either batch synchronization with, or a real-time wireless transmission to a
central database. The database can then provide useful reports about the status of goods in the
warehouse.
The objective of a warehouse management system is to provide a set of computerized
procedures to handle the receipt of stock and returns into a warehouse facility, model and
manage the logical representation of the physical storage facilities (e.g. racking etc.), manage
the stock within the facility and enable a seamless link to order processing and logistics
management in order to pick, pack and ship product out of the facility.
Radio-Frequency Identification (RFID)
RFID stands for Radio-Frequency IDentification. The acronym refers to small electronic
devices that consist of a small chip and an antenna. The chip typically is capable of carrying
2,000 bytes of data or less.
The RFID device serves the same purpose as a bar code or a magnetic strip on the back of a
credit card or ATM card; it provides a unique identifier for that object. And, just as a bar
code or magnetic strip must be scanned to get the information, the RFID device must be
scanned to retrieve the identifying information.
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6. 1.0 Project Goal
The project goal is to create a Warehouse Management System and integrate an RFID-based
technology that can facilitate the automation of all manual processes within the warehouse.
The system will prove beneficial to the company as it aims to reduce paperwork, eliminate
human error and improve data accuracy, gain more control over the warehouse, increase
speed and labor utilization, as well as to provide instant inventory and other types of
pertinent reports.
This Warehouse Management System is integrated with Radio Frequency technology that
has the ability to communicate with specialized tags that are embedded in pallets, shelves and
various locations (e.i. ingress and egress points) within the warehouse. Likewise, forklifts
will also be equipped with intelligent terminals as well as an RFID reader and antenna to
support automatic data scanning and storage location checking. With fixed RFID readers at
ingress and egress points, mobile RFID readers on warehouse automation equipment, and
RFID asset and location tags on waypoints and assets, the RFID Warehouse Management
System will provide greater levels of automation, error reductions, and decision support.
2.0 Problem / Opportunity Definition
CSG Incorporated is a provider of warehouse and storage services. Located in Imus Cavite,
the company’s warehouse facility occupies a land area of almost 8,500 square meters. This
immense product depot houses nearly 200,000 stocks of various elements from blank product
to blank product, which are delivered, disposed and accounted every day.
Over the years, CSG Incorporated has relied on a paper-based and semi-automated system of
inventory manned by over 65 personnel daily. This method of product tracking and
classification has been seen as ineffective and inefficient as it reflects a significant
probability of errors and inaccuracy. More so, the tedious process of manual inventory
further narrowed the bottleneck in the facility’s operations; thus affecting the entire
production cycle.
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7. Similar to many warehouse facilities, CSG Incorporated needs to streamline their current
warehouse operational procedures. An automated warehouse management system (WMS)
such as Radio Frequency Identification (RFID) is highly recommended to eliminate the
setbacks and improve productivity and control. In this system, RFID tags are attached to
products in the warehouse. These tags wirelessly broadcast information about the product
itself and its location; thus, providing accurate and real-time product identification in the
supply chain management and warehouse operations.
The RFID system will improve warehouse maintenance and increase warehouse efficiency.
This streamlining initiative will expedite mobility and categorization in the warehouse while
improving accuracy in numerical data. More so, this provision can particularly reduce labor
and logistic costs which have been identified as levers that pull the company’s profit
margins.
From a paper-based scenario where a warehouse personnel has to manually check and
encode products against the manifest, an automated and paperless tracking and checking
system will be in place. More importantly, from a tedious, time-consuming, and fallible
approach, a faster and more precise inventory control will be rolled out. All of these will be
made possible through the technology of radio frequency (RF) communications embedded in
the RFID tagging system.
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8. 3.0 Proposed Solution
The proposed solution is to create a Warehouse Management System with an integrated
RFID-based technology that will improve the entire inventory handling process by providing
an automated, systematic and accurate warehouse management cycle that is error-free,
efficient and updated real-time.
The warehouse performs four basic functions: (a) receiving of goods and other materials
from a source, (b) inspection, storage, cross-docking and protection of goods, (c) retrieval of
goods according to customer requirements, and (d) preparation of goods for shipping and
transportation.
To illustrate, pallets, cases, cartons and all other storage items in the warehouse will be RFID
tagged, plotting them in the system back-end. These tags are recognized by readers installed
in all the shelves, transporting equipments, and ingress and egress points in the warehouse.
As a result, all movements of goods within the warehouse are tracked and accounted, use of
space, equipment and labor is maximized, and retrieval of goods as needed becomes
systematic- all these contributing to increased customer service, productivity level, and
warehouse utilization.
4.0 Project Selection and Ranking Criteria
The utilization of this system will result to higher efficiency, reduction of cost and increase
in revenue through the following:
3.1 Project Benefit Category
INFORMATION AVAILABILITY
Status updates of receipts, manufacturing requests, and customer orders are made
available real-time. This gives warehouse management the responsiveness in
managing activities as they occur; hence, changing needs are immediately addressed,
labor is appropriately deployed, while space resources are maximized.
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9. LABOR PACING
Communication between the system and the operator allows the system to pace the
operator from one assigned task to the next. The operator does not need to return after
each task to a central location to get the next instruction. The system can select the
next task for an operator based on metrics and instructions applied (e.g. priority
queue, capability of operator, schedule of tasks, etc.). The result is workload
management that maximizes task accomplishment and minimizes labor idle time.
MATERIAL TRACKING
RFID allows verification of all transactions that affect materials location. This
verification updates status records used for future transactions, eliminates most
material location errors, and provides immediate instructions for resolving errors that
are identified. Real-time communication allows the warehouse to operate more
efficiently. Storage locations that are emptied are immediately marked in the system
and assigned to incoming loads and goods.
SECURITY
Shrinkage can be reduced with secure, item-level goods tracking, assuring that items
only leave the location when authorized.
3.2 Project Urgency
The client is already in the process of acquiring a third-party provider for the needed
RFID devices. Consequently, the proposed system has to be put into place as soon as
possible to avoid impeding the utilization of these devices.
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10. 5.0 Cost-Benefit Analysis
3.3 Tangible Benefits
This project can provide the company with tangible benefits that can quickly and
dramatically improve warehouse operations and increase material management
efficiencies without adding headcount. By implementing an RFID-based WMS, the
company will achieve a number of significant benefits. That includes the following:
• Reduced warehouse labor costs
• Reduced clerical labor costs
• Reduced overtime costs
• Reduced of physical inventories
• Lower shipping/freight costs
• Lower costs to rectify errors
• Reduced equipment costs
ASSUMPTION DRIVING VALUE
Inventory Savings - Historically, firms have found that the deployment of WMS
leads to significantly improved SKU by location, quantity, and lot accuracy as well as
reduced safety stocks. Other inventory related benefits have also been realized as
shown below.
Area of Savings Description/Logic Savings Metric
Reduction of Safety Stock - Eliminate extra stock, - Annual carrying costs
increase turns
- Improve cash use
Reduction of Loss/Shrinkage - Tighter inventory control by - Product write-off cost
location
Reduced Shelf Life Losses Due to - Tighter inventory control by - Product write-off cost
Expiration Issues lot
Reduced Product Damage, Scrap - Minimized handling - Product write-off cost
& Rework
Reduced Returns - Shipping the right products at - Product write-off cost
the right time
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11. Labor Reduction/Avoidance Related Benefits
This category is typically the primary driver of ROI. Establishment of labor savings
requires a thorough review and match of each current warehouse process against the
projected time/cost of process execution with the WMS and adoption of best practices.
A sampling of labor cost reduction opportunities is shown below:
Process Best Practice/Benefit Savings Metric
Pre-Receiving - Eliminates data entry - # hours/cost for indirect
labor
Receiving - Streamlined paperless - # hours/cost for
receipt/inspection of goods via RF direct/indirect labor
terminal. Reduced receiving/ labeling
time
Inspection - WMS directed inspection and - # hours/cost for
system-wide holds direct/indirect labor
- Streamline receipts, eliminate paper - Reduced cost of supplies
holds and ticket generation (paper, etc.)
Directed Putaway - WMS automatically selects and - # hours/cost for
assigns storage location direct/indirect labor
- Minimizes dead heading
Cross Docking - WMS automatically allocates stock - # hours/costs for
and cross docks direct/indirect labor
- Eliminate significant labor in - Storage space usage costs
handling and storage and cost of
storage
Wave Generation/Shipment - WMS organizes picks in optimal - # hours/costs for indirect
Planning sequence, builds truckloads. Reduce labor
indirect labor for printing and sorting - Reduced cost of supplies
of orders, and truck
load building
Pick Preparation - WMS drives printing of shipment - # hours/costs for indirect
sets in optimal pick path, by type, etc. labor
Reduces indirect labor for paper - Reduced cost of supplies
handling
Picking - WMS assigns picks via RFID - # hours/costs for indirect
labor
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12. Equipment Related Savings
Taking labor out of an activity often results in the reduction or elimination of
associated equipment. Equipment savings may include:
Benefit Description/Logic Savings Metric
Elimination of Excess or - Remove the operator….remove - Annual lease/rental cost
Obsolete Equipment equipment
- Eliminate leases/rental charges
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13. Eliminate Maintenance - Less equipment = reduced - Annual maintenance cost for
Costs for Excess or Obsolete maintenance, parts and/or labor labor and parts
Equipment
Reduced Cost for Existing - Higher utilization rate leading - Annual maintenance cost for
Equipment to lower per hour cost
- Reduced per user cost
Space Related Savings
A WMS should improve space use through better inventory deployment and
consolidation based upon advanced cube utilization algorithms. The resultant savings
may occur in several areas:
Benefit Description/Logic Savings Metric
Eliminate Existing - More efficient storage based on - Lease/rental costs
Overflow Space WMS storage optimization logic - Utilities, etc.
Reduced Transportation - No shuttling product to/from - Transportation costs
Costs with Elimination of overflow facility
Overflow Space
New Construction - Better utilization reduces - Lease/rental costs
Avoidance requirement for new space
3.4 Intangible Benefits
• Increase in organizational transparency and responsibility.
• Accurate and faster access to data for timely decisions.
• A wider reach in terms of vendors, thus producing more competitive bids.
• Improvement in customer response time.
• Significant decrease in time and effort needed in data entry.
• More controls thereby lowering the risk of inappropriate utilization of resources.
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14. • Ease in gathering pertinent data needed for strategic planning.
ASSUMPTION DRIVING VALUE
Information Systems Related Savings
In assessing potential savings from a new Warehouse Management System, the cost
of the system being replaced must be considered. Typically, legacy WMS or
homegrown, host-based systems are expensive to maintain and upgrade. Use of newer
packaged solutions will eliminate the heavy annual investment in development and/or
system administration necessary for legacy systems. Deployment of a Warehouse
Management System will also require one or more system administrators. Generally,
however, when viewed against the backdrop of total IT administration costs, the
utilization of such a system should provide overall lower costs.
Area of Savings Description/Logic Savings Metric
Reduced Legacy Support - Less IT support given efficient - Personnel costs
operation of WMS
Reduced Enhancement and - Greater functionality in the - Development costs
Upgrade Costs WMS package
Eliminate Legacy - Eliminate legacy hardware and - Lease & support costs
Equipment/Software software
Employee Related Savings
Positioned as a productivity tool, given a well-managed training program, a WMS can
generate substantial goodwill within the labor force and improve employee retention.
Area of Savings Description/Logic Savings Metric
Improved Morale & - Higher operational efficiency - Workforce turnover
Reduced Turnover due to better attendance and - Personnel hiring costs
individual performance
- Reduced temporary labor
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15. Reduced Supervision - WMS directs high percentage of - Supervisory costs
activities
- Lower direct supervision
Reduced Training - Less turnover due to desire to - Cost to retrain staff
work with system
- Lower training costs
Reduced Accidents - Elimination of stock search - Accidents & related costs
tasks
- Reduced travel distances
- Lower accident rate
Customer Service Related Savings
While perhaps difficult to quantify, lost sales or customer goodwill due to inefficient
warehousing operations has an economic effect. Nonetheless, every effort should be
made to quantify these costs. Ask sales or marketing for help.
Area of Savings Description/Logic Savings Metric
Increased Sales - Faster order processing and data - Incremental sales
availability
- Improved client relationships
based upon better order inquiry
response, turnaround, etc.
On-Time Delivery - Improved order processing - Expediting costs
based on required delivery date - Cost for returns processing
- Minimize missed dates, lower
returns
Customer Satisfaction and - Access to WMS data for CRM - Incremental sales
Improved Service purposes - Customer service costs
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16. 3.5 Budget Control Analysis
PROJECT COST ESTIMATES
Units/Hrs. Cost/Unit/Hr. Subtotals Totals % of Total
1. Project Management 942,727.27 60%
1.1 Project Manager 640 681.82 436,363.64
1.2 Business Analyst 80 340.91 27,272.73
1.3 Dev Technical Lead / Sr.
Web Developer 440 426.14 187,500.00
1.4 Web Developer 400 284.09 113,636.36
1.5 Web Designer 144 170.45 24,545.45
1.4 Sr. System Quality
Assurance 360 255.68 92,045.45
1.5 Quality Assurance (tester) 360 170.45 61,363.64
2. Hardware 280,000.00 18%
2.1 Servers (Database) 2 280,000.00
3. Software 0.00 0%
3.1 Licensed software (IDE
and Test Tools) Open Source 0.00
4. Testing*
4.1 Testing 85,000.00 5%
6. Reserves
(20% of total estimate) 249,545.45 261,545.45 17%
Total project cost estimate 1,597,272.73
* See mandays and Personnel Cost Estimate
Personnel Cost Estimate Salary / Month Total Rate/Hour Total
Mandays
Project Manager 120,000.00 80 681.82 436,363.64
Business Analyst 60,000.00 10 340.91 27,272.73
Dev Technical Lead / Sr. Web Developer 75,000.00 55 426.14 187,500.00
Web Developer 50,000.00 50 284.09 113,636.36
Web Designer 30,000.00 18 170.45 24,545.45
Sr. System Quality Assurance 45,000.00 45 255.68 92,045.45
Quality Assurance (tester) 30,000.00 45 170.45 61,363.64
2,3
Total Mandays/ Resources 303 942,727.27
30
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17. 3.6 Financial Return
Getting the ROI of this project investment requires articulation of:
• The total price of the solution including internal and external costs.
• Recurring savings for target payback period. ( Annual savings figures )
• The required rate of return based upon internal standards for financial analysis;
e.g., simple payback, NPV, etc.
PROCESS SYSTEM INTEGRATION ROI
Inefficiencies managing Order dashboard / Decrease Costs
paper pick tickets RF or voice picking
Random inventory storage Optimize storage Decrease Costs
Receiving to paper Purchase Order Handheld RF receiving Decrease Costs
to Purchase Order real time
Difficulty locating product Real-time RF inventory moves for your Decrease Costs
complete inventory visibility
Shipping errors resulting in credit RF shipping verification to the actual Decrease Costs
memos & customer complaints order Increase Sales
Inefficiencies throughout the Increase fulfillment speed / Decrease Costs
shipping process reduce overhead Increase Sales
Misplace product Handheld RF real-time bin or location Decrease Costs
transfers
Physical inventory time Increase inventory accuracy Decrease Costs
consuming Increase Sales
Serial & lot tracking and shelf life Serial & lot tracking visibility Decrease Costs
requirements
Reduce credit memos RF shipping Verification to the actual Decrease Costs
order
Slow inventory turns RF or voice increases fulfillment speed Increase Sales
to reduce overhead / increase turns
Freight costs Reduce expedited freight costs Decrease Costs
RFID requirement Integrated RFID Decrease Costs
Increase Sales
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18. This analysis should be undertaken as soon as the opportunity has been identified and
subsequently refined and recalculated upon package selection using the vendor’s final
costs.
ROI based on Key Performance Indicators
KPI Definition Objectives Influential
Readiness to Deliver No. of request Delivery service Order handling,
delivered in due time customer satisfaction throughput, capacity
No. of requests
Warehouse fill degree No. of occupied Utilization of storage Inventory
locations capacity management
Storage capacity
Transshipment level Retrieval Warehouse dynamics Size of shipping units
quantitative Storage capacity
Transshipment level Total turnover Inventory cost Ordering system
quantitative Stored value
Value-based
Cost / Storage location Total cost Choice of warehouse Warehouse
Storage capacity technology technology
Inventory coverage Current stocks Inventory costs, Ordering system
quantitative Warehouse turnover warehouse dynamics,
service level
Inventory coverage Stocks Inventory costs, Ordering system
quantitative Warehouse turnover service level
Value-based
Picking way/item Average picking route Choice of picking Process control,
Line items technology picking principle,
information
management
Picking density No. of line items Average way times, Supply management
Gripping space picking performance rack technology
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19. Financial Analysis Estimates
ORDER FULFILLMENT MEASURES
MEASURE CALCULATION TODAY FUTURE VALUE
On-Time Delivery Orders On-Time % % ₱
Total Orders Shipped
Order Fill Rate Orders Filled Complete % % ₱
Total Orders Shipped
Order Accuracy Error-Free Orders % % ₱
Total Orders Shipped
Line Accuracy Error-Free Lines % % ₱
Total Lines Shipped
Order Cycle Time Actual Ship Date (minus) Hrs Hrs ₱
Customer Order Date
Perfect Order Perfect Deliveries % % ₱
Completion Total Orders Shipped
WAREHOUSE OPERATIONS PRODUCTIVITY MEASURES
MEASURE CALCULATION TODAY FUTURE VALUE
Order per Hour Orders Picked/Packed Order / Hr Order / Hr ₱
Total Warehouse Labor
Hrs
Lines per Hour Lines Picked/Packed Lines / Hr Lines / Hr ₱
Total Warehouse Labor
Hrs
Items per Hour Items Picked/Packed Items / Hr Order / Hr ₱
Total Warehouse Labor
Hrs
Cost per Order Total Warehouse Cost % / Order % / Order ₱
Total Orders Shipped
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20. Cost as % of Sales Total Warehouse Cost % % ₱
Total Orders Shipped
INVENTORY MEASURES
MEASURE CALCULATION TODAY FUTURE VALUE
Inventory Accuracy Actual Qty per SKU % % ₱
System Reported Qty
Damaged Inventory Total Damage $$$ % % ₱
Inventory Value (cost)
Days on Hand Avg. Month Inventory $ Days Days ₱
Avg. Daily Sales/Month
Storage Utilization Avg. Occupied Storage % % ₱
Fit
Total Storage Capacity
Dock to Stock Time Total Dock to Stock Hrs Hrs Hrs ₱
Total Receipts
Inventory Visibility Receipt Entry Time – Hrs Hrs ₱
Physical Receipt Time
Net Present Value
NET PRESENT VALUE
YEAR ANNUAL SAVINGS
NPV ¹
YEAR 1 ₱ ₱
YEAR 2 ₱ ₱
YEAR 3 ₱ ₱
YEAR 4 ₱ ₱
YEAR 5 ₱ ₱
TOTAL ₱ ₱
¹Future Value =Projected Savings / (1 + interest rate)n
Where n is the year in which savings occur
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21. 6.0 Business Requirements
3.7 Major Project Activities
Stakeholder List
STAKEHOLD PERSONNEL CONCERNS QUADRANT STRATEGY
ER
Warehouse Eluetero Ensuring proper Minimal Communicate project
Manager Hernandez handover of business Effort specifications as required
process documents to
#09178546623 the development team
Business Analyst Judi Anne Resource and Key Player Solicit stakeholder as member
Supelana scheduling constraints of steering committee and
for production once obtain feedback on project
#09179023312 project is transitioned planning. Frequent
to operations communication and addressing
concerns are imperative
Steering Joseph Ensuring on time Minimal Communicate project schedule
Committee Nepomuceno delivery of materials Effort and material requirements
ahead of time to ensure
#02-8389985 delivery
Project Cherie Mae Ensuing proper Key Player Solicit frequent updates and
Coordinator Cirilo alignment of all develop plan for alternative
activities on both the supply source
#0932554864 development side and
client side
Project Manager Cheri Amour Product performance Key Player Communicate test results and
Calicdan must meet or exceed performance specifications and
current product obtain feedback on customer
#09228447877 requirements or any changes.
Provide frequent status reports
and updates.
Sr. Software Arian Dave Concerns regarding Keep Communicate resource
Developer Mabanag resources to assist Satisfied requirements early and ensure
project team with resources are released back to
#09178237841 product design engineering when they’re no
longer required
System Quality Vincent Acero Questions regarding Keep Allow technical staff to work
Assurance design of system Informed with stakeholder to answer
#09245584136 questions and address concerns
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22. and provide test results for
validation
Define System Requirements Specification
1. System Architecture – A description of the network and hardware design for the
solution.
2. System Design – A description of the system flow and integration with internal
and external systems that includes communication protocols, formats and
frequency.
3. System Process Flows – A collection of all the system process flows showing all
the key points of system interaction and integration with internal and external
systems.
4. RF (Radio Frequency) Design Flow – A description of the RF flow and
explanation of the logic including exception handling on each RF screen.
5. Reports – A description of all the reports required (operational and planning).
The details should include descriptions of all online reports, purpose/usage,
intended audience, parameters and corresponding validations on screen, data
extraction source and logic, report format/layout and report export requirements.
Functional Requirements based on Business Requirements
MODULE DESCRIPTION
RECEIVING The receiving module lets you track the receipt of material
from vendors or from internal production operations. Bar
code labels may be produced for items, containers or
pallets. If desired, items and quantities may be validated
against an expected receipts list. Because the system is a
real-time system, received material is immediately
available to fill customer orders. Material may be set aside
for crossdock, received directly to a storage location, or
placed in a temporary staging location to be handled later
with the Putaway transaction.
PUTAWAY The Putaway module is used to move material from staged
receiving locations to final storage locations. Based on
system configuration, material may be moved to prime
locations, locations holding like items, empty locations and
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23. more. Users may specify the Putaway sequence or use the
system's suggested sequence which directs users through
the warehouse in an optimized travel path.
ORDER PICKING The picking module provides an extremely flexible and
efficient method for picking orders without any paperwork.
Many options are offered including order picking, group
picking and zone picking. If desired, orders may be picked
by priority or user-defined type (customer order, production
order, etc.) Consistent with other sytem functions, the
system suggests pick locations in an optimized travel path,
and alternative pick locations are available at the touch of a
key.
PACKING AND SHIPPING The Packing and Shipping modules are used to box, verify
and ship orders that have been picked. Packing lists and bar
code labels may be produced to identify boxes and order
contents.
PHYSICAL INVENTORY The Cycle Count module can be used to verify inventory
AND CYCLE COUNT for a specific item or location, or it can be used to perform
a complete physical inventory. Cycle counts, like other
system tasks, may be performed in user-directed and
system-directed modes. Inventory discrepancies may be
corrected automatically and immediately, or they may be
flagged for later review. Because the system is a real-time
system, there is no need to "freeze" inventory during the
cycle count process.
REPLENISHMENT The Replenishment module lets you move material from
bulk storage to forward pick locations that are running low
on material. The system maintains maximum and minimum
quantities for any desired item and location. As an on-hand
quantity falls below the defined minimum, the system
creates a replenishment requirement for that item and
location. Users are later directed to move material to
depleted locations.
REPORTS AND The Reports and Statistics module will provide daily,
STATISTICS weekly, monthly, quarterly and annual data based on all the
information stored in the system’s database.
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24. 3.8 Out of the scope activities that are critical to the project
success
Activities that are critical to the success of this Warehouse Management System but
are beyond the scope of this project includes the successful acquisition, installation,
implementation and maintenance of all RFID devices. The system will be dependent
on the inputs generated by the RFID devices since the system will gather all its data
from the database populated by the said RFID devices.
7.0 Major Obstacles
The following are the challenges that are highly likely to be experienced related to creating
and implementing this system:
 The transition from a manual to an automated system will require extensive
preparation specifically on the operations-side. Flows and processes should be
thoroughly examined to ensure that the implementation of this wireless technology
does not hamper operations, supply-chain and warehouse management in place.
 Alignment of the RFID WMS with the primary business software must be rolled-out.
 Procurement of equipment such as RF/barcodes scanners, portable as well as heavy
duty printers, and the appropriate type of labels must be done after careful selection
from various options, taking into consideration the adaptability of existing systems
and software.
8.0 Risk
Although the implementation of an RFID WMS will greatly benefit key areas, there are still
risks associated with the system. Primarily, if the RFID tags fail, the system will not be able
to track the movements of goods inside the warehouse. Moreover, the following issues are
considered risks:
DEAD AREAS AND ORIENTATION PROBLEMS – RFID works similar to the
way a cell phone or wireless network does. Like these technologies, there may be
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25. certain areas that have weaker signals or interference. In addition, poor read rates are
sometimes a problem when the tag is rotated into an orientation that does not align
well with the reader. These issues are usually minimized by proper implementation of
multiple readers and use of tags with multiple axis antennas.
PROXIMITY ISSUES – RFID tags cannot be read well when placed on metal or
liquid objects or when these objects are between the reader and the tag.
SECURITY CONCERNS – Because RFID is not a line-of-sight technology like bar
coding, new security issues could develop. For example, a competitor could set up a
high-gain directional antenna to scan tags in trucks going to a warehouse. From the
data received, this competitor could determine flow rates of various products.
Additionally, when RFID is used for high-security operations such as payment
methods, fraud is always a possibility.
GHOST TAGS – In rare cases, if multiple tags are read at the same time the reader
will sometimes read a tag that does not exist. Therefore, some type of read
verification, such as a CRC, should be implemented in either the tag, the reader or the
data read from the tag.
HIGH COST – Because this technology is still new, the components and tags are
expensive compared to barcodes. In addition, the software and support personnel
needed to install and operate the RFID reading systems (in a warehouse for example)
may be more costly to employ.
UNREAD TAGS – When reading multiple tags at the same time, it is possible that
some tags will not be read and there is no sure method of determining this when the
objects are not in sight. This problem does not occur with barcodes, because when the
barcode is scanned, it is instantly verified when read by a beep from the scanner and
the data can then be entered manually if it does not scan.
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26. VULNERABLE TO DAMAGE – Water, static discharge or high-powered magnetic
surges (such as lightning strike) may damage the tags.
9.0 Schedule Overview
3.9 Major Milestones
 Define scope of project.
 Identify stakeholders, decision-makers, and escalation procedures.
 Develop detailed task list (work breakdown structures).
 Estimate time requirements.
 Develop initial project management flow chart.
 Identify required resources and budget.
 Evaluate project requirements.
 Identify and evaluate risks.
 Prepare contingency plan.
3.10 External Milestones Affecting the Project
 Installation of all RFID devices.
 RFID device implementation and testing.
 User Acceptance of RF technology.
3.11 Impact of Late Delivery
Delay in project roll-out will result to an increase in the project cost. This will also
impact the usability of the acquired RFID technologies.
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27. 10.0 Estimated Project Completion Date
Total production duration is (87) working days / (4) months. Please note that weekends and
holidays are excluded in the schedule. Any public holidays and announced no-work day will
affect our schedule and extend the corresponding deadlines using a ratio of one-is-to-one.
(2) Months will be dedicated on product development. Time estimates is based on the initial
Work Breakdown Structure (WBS).
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28. Work Breakdown Structure Mandays Resource
1.0 Project Initiation
1.1 Develop Project Charter 1 Business Analyst
1.1.1 Identify Problem Statement / Opportunity (Business Case)
1.1.2 Meet with Stakeholders to identify Major stakeholders
1.1.3 Secure approval /sign-off
2.0. Project Planning and Scoping
2.1 Business Requirement Specs 5 Project Manager
2.1.1 Data gathering / elicitation of requirements
2.1.2 System Requirement Analysis
2.1.3 Scope Specification
2.1.4 Peer Review and Phase Sign Off
2.2 Systems Requirement Specification 12 Dev Technical Lead
2.2.1 Analyze Requirement / Impact assessment / Web Designer
2.2.2. System Design
2.2.3. Data Modeling
2.2.4 Database Structure
2.2.5 Prototyping or Wire Framing / Preliminary Conceptual Design
2.2.6 Final Design Presentation
2.2.7 Phase Sign Off
2.3 Develop Test Plan and Strategy Project Manager /
2.3.1 Test Case / Scrip development QA Lead
2.3.2 Identify Resource and man-days
2.3.3 Identify Tools required
3.0 Execution
3.1 Coding and Development 45 Project Manager /
3.1.1 Coding QA Lead /
Dev Team
3.1.2 Build Release
3.1.3 Code Review
3.2.3 Unit Testing / Module Testing
3.2.1 Iteration Testing
3.2.2 Progress Archiving
4.0 Quality Assurance
4.1 Final Quality Assurance 16 QA Lead /
4.1.1 System Testing Dev Team
4.1.2 Integration Testing
4.1.3 Performance / Load Testing
4.1.4 Use Acceptance Testing
5.0 Implementation
5.1 Production and Implementation
5.1.2 Production Server Final Testing
5.2 User Training 3 QA Lead OR
5.2.1 Set Schedule Dev Team
5.2.2 Conduct Training
Total Working Days 87
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