A few weeks ago I blogged about the unique warehousing needs of rolled and continuous products like cold and hot rolled metal coils and sheets, bales, paper rolls, cables and wires. One of the drawbacks of using WMS in this type of an environment is that WMS does not recognize over picking of items and does not over-allocate more than ordered quantity to optimize picks.
Let me illustrate this shortcoming with an example e.g. if you have an order for a wire for 100 meters with a 10% over ship tolerance. Assume you have bobbins in the warehouse with 105 meters, 110 meters and 150 meters of wires respectively. If you model the bobbins as LPNs and have full LPN allocation mode turned on, WMS will backorder the entire quantity even though two of the bobbins i.e. bobbins with 105 meters of wire and 110 meters of wire is within the tolerance. If you do not have full LPN allocation mode, it will assume that you will cut 100 meters from one of the bobbins and allocate the rest to some other order. This is even worse since it will unnecessarily force you to cut material when nothing like that is needed.
One of the customizations we did a long time ago for one our customers was to make sure that WMS looks at LPNs greater than the ordered quantity for allocation purposes. This works very well for the situations we illustrated earlier. In the above example, with this customization it’s possible to allocate more than the ordered quantity and create a task to pick the bobbin with 105 meters of wire.
The good news is that this feature is now available in the standard product. The feature dubbed “over allocation” in R12.1 works exactly like I outlined above. With over allocation mode, the task quantity can exceed the quantity ordered provided the overall allocated quantity is within the shipping tolerance. You can either specify the over ship tolerance within the rule or instruct the rules engine to use the over ship tolerance at order line level. To take full advantage of this feature, you need to have full LPN allocation. The advantage of this feature is that the LPNs that contain more material than the ordered quantity, but within the over ship tolerance, are considered for allocation. There is no more issue of backorder and the need to cut products to get the desired size is minimized.
Please note however, this works only for Sales Orders at current time, not for orders from manufacturing where this is a common problem as well. We faced this issue while architecting the WMS solution at Zebra and have employed a different strategy to overcome this.