Three ways your legacy WMS is holding back your business

Recognizing what you are doing poorly and correcting it is not nearly as valuable and rare a business skill as recognizing what you are not doing at all that you should be. One of the most vulnerable positions for a business to be in is to be satisfied with the status quo. When you think about whether your legacy WMS is allowing your business to maximize its potential, there are three areas you to need to explore with brutal candor.  

1. Your legacy WMS hasn’t evolved with your business

Think about the structural changes to all businesses since your WMS was implemented. Customers have insanely high expectations about variety, quality, service, and delivery. Business has evolved from one or two major channels of distribution to multiple channels. Think about security and how much security issues have changed. Think about how unimportant cash, as a requirement for conducting business, has become. Was your legacy WMS designed to handle all those changes? Have you adapted? Or are you left wondering if competitors with more up-to-date WMS software are better poised to take advantage of all these structural changes?

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2. Encouragement of workplace stagnation

Have you ever read about, and are you conscious of, the law of irrational escalating commitment? It is the behavioral and sociological phenomena that occurs when people or groups become increasingly supportive of an idea or process that is clearly yielding increasingly unsatisfactory results.

Does discussion of changing or replacing the legacy system suddenly build consensus that the legacy system is the greatest thing since sliced bread? And that replacing it would be the first step on an inevitable trajectory of going out of business? If so, be careful. You may be operating in an environment of irrational escalating commitment.

3. Out-of-date features

It is a safe bet that your legacy WMS does not contain state of the art metrics, reporting, and analytics. This may be one of those, “We don’t know what we don’t know” situations, but when you read about what companies are achieving with Big Data, doesn’t it have to make you question whether you are being left behind?  The issue isn’t that everybody needs to use Big Data (most do not).  The issue is that data is plentiful,  cheap, and in today’s world, people are reacting to measurements and information in real time, not waiting on weekly or monthly reports.

Your legacy WMS has a lot of perceived benefits, or you would have replaced it long ago.  If you are the leader in your industry segment, if you are growing as fast as the organization can adapt, if your profits are well above a normal expected economic value rate of return, then you may have no need of thinking about replacing it.  However, if your growth lags expectations, if your competitors seem a little bit more agile, if your operating margins are never quite what you think they should be, then think about these three things, and whether your WMS system is as good as you think it is.

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Shane Starr

About the author…

Shane Starr is a former ERP project manager, with business experience in manufacturing management, supply chain, finance, and strategic planning.

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Shane Starr