Different Flavors of Warehouse Management in Dynamics NAV

Overview

Dynamics NAV (Navision) is a comprehensive ERP system. As such, it has many features that caters the different needs of businesses, for example, manufacturing, service managment, CRM, distribution, etc. Each one of these functional areas can be configured a number of ways depending on the needs of the business. During my time working at AP Commerce, there are never any shortages of investigating different setups based on on the needs of a business.

What you think you need may not be what you need. Yes, I did write that in one stroke without flinching. One of the most common requests from potential and current users of Dynamics NAV (Navision) is they want to effectively manage their warehouse using warehouse management system.

The question I’m always tempted to ask is: “What type of Warehouse Management are you looking for?” Of course I never ask that question because this will cause more confusion than I can handle.

So why am I tempted to ask that question? Again, in each functional area in Dynamics NAV (Navision), there are a number of ways to set it up. Having said that, here are different ways to setup WHM for your business. Note that Warehouse Management can be defined per warehouse, so every warehouse that you have can be setup differently.

NOTICE! The purpose of this article is not to give you a complete step by step instruction on NAV warehouse management, the purpose is to give you some knowledge on different ways to go about implementing WHM so you can have some knowledge and input when you speak with your Dynamics NAV partner on it.

Considerations

One word of caution is when implement ANY warehouse management system, you have to make sure your warehouse is organized, efficient, and accurate. A lot of companies make the mistake of buying a warehouse management software because the warehouse is too messy.

DON’T DO IT!

Software, in general, is designed to streamline your operation and speeed up the processing. If your warehouse is disorganized, inefficient, and not accurate, any warehouse management software will make it worst. You will be disorganized, inefficient, and inaccurate at a faster rate. Garbage in, garbage out.

The Flavors

Here’s a picture of the Warehouse Mangement setup in Dynamics NAV:

Bin Mandatory

From initial look, if you just want to keep track of the items on the bins, this is the option for you, right? Unfortunately, no… I’ve never been in an implementation where we just place a checkbox on this field without at least enabling Ship/Pick or Receive/Put-away.

Just checking this on enables you to keep track of items by bin, however, one of the main problem with just checking this on is that you specify bin on the purchase and sales order. So if you have an item that’s on 2 different bins, you have to split the sales/purchase lines. Not only that, if you want to move an item from one bin to another, you have to use the item reclass journal, which effectively creates Item Ledger, value entry, and the general ledger. Doing physical inventory may also create a lot of excessive entries that will bog you down when you use the Item Ledger to do any sales and purchase analysis.

Pros: Allows you to tag bin code to an inventory transaction

Cons: Have to split sales and purchase line so the quantity matches the bins on the item ledger Creates a lot of excessive entries to key ledger tables Makes life harder than it has to

You Typically See This Setup for: No one. You’re better off using the Shelf/Bin No. field on the item card. This is how NAV 2.0 handles bins. We’re in Navision version 7 (Dynamics NAV 2013) now, no sense in going backwards when there are better options.

Require Shipment/Receive

Just enabling these option allows you to use the Warehouse Ship/Receive function. The main purpose of the Warehouse Ship/Receive is to allow the user to batch the sales orders by a container or a trailer going out per carrier. This option is typically enabled for companies that ships and receives by containers. The warehouse shipment is typically used to generate your bill of lading for the trucker.

Without turning on Pick and Put-away, I would NOT recommend turning on Bin Mandatory. You would encounter the same problem that I’ve stated above. For smaller companies, spliting up the warehouse process may not be necessary.

Pros: Allows you to Ship and Receive by container or bill of lading Warehouse Manager can control what he/she wants to ship based on released orders instead of the order processor printing out a pick ticket The warehouse process is separated out from the order fulfillment process (so warehouse can do their own posting) More accurate inventory can be achieved since inventory can be relieved when it’s shipped

Cons: Not recommend to enable Bin Mandatory (same cons as above) Not necessary if you do not wish the warehouse people to be posting stuff

You Typically See This Setup For: Large item distributors or manufacturers that want split out their warehouse processing, but does not care of bin contents Companies that ship and receive by containers but do not want to split their items into bins in the warehouse.

Require Pick/Put-away (No Require Shipment/Receive)

This is an option is what I would like to call the mini-fullblown warehouse management. This options provides the flexibility for the warehouse staff to create warehouse put-away and warehouse picks as they see fit, they can also assign these warehouse documents to the appropriate people to do the processing. Another way to use this feature is to allow the order fulfillment people to create the pick request to the warehouse without actually printing a pick ticket.

The draw back of using this option is that you’re only allowed to have one sales/purchase order per put-away/pick. This means that you won’t be able to group the orders together in one warehouse shipment (as stated above) to generate a consolidated bill of lading. Same goes for the receiving side, you won’t be able to receive by container or by bill of lading.

This option works perfectly if you want to enable Bin Mandatory. The Inventory Pick/Put-away document generated will allow you to split lines at the warehouse document level so you can put the items away in their proper bin without having to modify the original purchase or sales order.

Pros: Allows you to easily process inventory transactions by Bin Warehouse Manager can control what he/she wants to ship based on released orders instead of the order processor printing out a pick ticket The warehouse process is separated out from the order fulfillment process (so warehouse can do their own posting) More accurate inventory can be achieved since inventory can be relieved when it’s shipped

Cons: Not able to group orders together into one shipment or receipt Not be able to use ADCS (wireless handheld)

You Typically See This Setup For: Companies that would like to organize their warehouse by bin, but does not have the manpower to go Directed Pick/Put-away.

Directed Pick and Put-away

This is the full deal. It has all of the benefits that I’ve listed above. Group order together by warehouse shipment and be able to pick and put away by bins. Not only that, this allows you to use ADCS (wireless handheld device) so your warehouse staff and record warheouse transactions using the handheld.

All good right?

Not exactly. It really depends on what your company needs. All these features sounds cool, but if your business does not need it, trying to shove it in may create more work and processes than necessary. There are a couple of steps where the user need to interface with a computer when you enable Directed Pick and Put-away:
1. Create the sales order
2. Create warehouse shipment
3. Create pick
4. Register pick
5. Post warheouse shipment
6. Post sales order

Whereas if you do not enable any of these, the steps would be:
1. Create the sales order
2. Post the sales order

Conclusion

It’s highly recommended that you get with your Dynamics NAV partner and discuss which setup is right for your business RIGHT NOW with consideration for future growth. If you try to implement everything without any consideration for your current operation, the opertional efficiency will decrease. This is because of the increased overhead and maintenance that are required.

Make sure your company have the manpower and the infrastructure to absorb the overhead and maintenance required so the increase in efficiency and accuracy can be realized.

Do not implement some feature just because you like the feature. In most cases, it will be overkill. It’s like buying a size 10 top-of-the line Nike tennis shoes for your 3 year old son and forcing him to walk in it every day. Eventually, he will grow into it. But by the time he grows into it, he’ll develop some other major problems that will cost more money to fix.

Leave a comment ?

14 Comments.

  1. Hi Alex, just found your blog and liked your article above plus comments on partner program changes which are eliminating smaller partners. We probably do a few more sales than you each year 7-8 new sites but 90% of these are sites that would never have purchased NAV without us selling it based on personal relationship building(no other NAV partners insite and competing products that could have won). Interestingly the New Zealand doemstic market has locally developed ERP products with seemingly every man and his dog selling it and they are kicking MS butt in number of sites – tends to indicate MS have no idea in how their policies are actually lowerig sales.

    My only disagreement with you would be comment NAV tends to follow best practice in their features and processes. Cant say I agree with that as I think some of the work flow is terrible and I am speaking as from an ex user business systems backgound. Can’t say any new process features in the last ten years have hit the mark running (how many bugs did prepayments have) so it seems the tech heads are running the show and the business process specialist have been relegated to the side lines, it should be the other way around.

    All the best with your business any way hopefully you can still prosper even though MS seem to enjoy chucking hurdles in our way.

  2. Hi Jeff,

    There are some procedures in Dynamics NAV that may seem quirky at first. However, from my experience working with NAV, in the end NAV tends to be right. Perhaps it’s the US market vs. the New Zealand market.

    The “Best Business Practice” implemented in NAV is NOT the best business practice for your client’s business. It’s up to the consultants to make the process fit for their clients. Thankfully, NAV is able to do this easily and quickly. This is why I’m still working with Microsoft.

  3. Hello, and thank you for spreading NAV wisdom on different topics one may encounter when working with NAV. Just one question regarding this warehouse setup:
    In nav 2013 one can combine assembly items with require pick/put away and bin mandatory field on the location ( as you’ve said’ i call it the mini-full blown warehouse management’).
    But, I just can’t figure out the standard workflow when using this features, all the materials I have do not show how to post assembly order and sales order (assembly is disabled for posting because of field assembly to order=TRUE)?
    If i try to post sales order directly it tells me to ship first,if i try to ship i need to pick first etc..
    Thank you in advance..

  4. Alex Dragojevic

    The solution for above Problem is to use Location for finished articles that do not require bins. Anyway, using assembly with Serial/lot numbers and warehouse Management may be tricky..

  5. Hi Alex, Can you suggest better putaway template in Navision? Scenario is, all product can be stored in any bin as per their status as empty. Navision Consultant suggested Bin Content but that is too much lengthy and not feasible when large product list. Current no of sku is 20000 and 200000 bin location.

  6. Have you tried using the Find Empty Bin setting on the putaway template?

  7. Hi Alex, Thanks for your response. As I am new in Navision WMS and Navision consultant has suggested that solution is through bin content only. Can you elaborate on putaway template or advise, if you have written any blog on this?

    Thanks

  8. Bin Content is one of the small component of the bigger WMS process in Dynamics NAV. Bin Content gives you the item information for a particular bin. Put-away template is how the system would suggest put-aways when you need to put the items away.

    Without knowing what you’re trying to do with WMS it’s really tough to give proper advice on how you should set this up.

    Have you brought up your concerns with your NAV consultant? Ask them to give you different options on how to solve your business problem. If you’re not fully comfortable with a solution, don’t proceed!

  9. Agnes Farkasreti

    Hi Alex,
    I have an issue, maybe not related to the above discussion but still might be interesting for others. When you have one sales order in Navision, WH setup requires shipment and pick, you have bins mandatory, which order makes 2 loads, how can you create 2 warehouse shipments from one order? We used to do it in the previous NAV version by editing the Quantity in WH shipment lines to fit to Load1, than we created a 2nd WH shipment from the same order from the remaining qty. This version doesn’t allow the creation of a 2nd WH shipment until the 1st is posted. Have you ever tried or managed to solve this problem?

  10. Hi Agnes, when you said “previous version”, I don’t think NAV has it out of the box. I think your previous version of NAV was modified and probably wasn’t brought over during the upgrade.

    An alternative if you don’t want to use the mod is to look at using the Use Filters to Get Source Docs. function from the warehouse shipment? This will allow you to pick and choose which items on which order you want to bring to the warehouse shipment.

  11. Agnes Farkasreti

    Hi Alex,
    As far as our NAV expert could see, the only modification around this topic was to make the Quantity field on WH Shipment editable, and somehow it worked as we wanted. That ‘Use Filters…’ way, unfortunately, doesn’t work either; when WH shipment line is created from a Sales (or Transfer) order line, you cannot drag the same line again to a new WH shipment, although Quantity from the order line is not fully used by the 1st WH shipment. Hence the issue: our customers like big orders, filling 2-3 lorries but getting only one invoice with one line – so creating sales order / lorry is not an option, the invoice would show as many lines as lorries used. Don’t see how we could solve this issue than.
    Thank you for your help anyway.

  12. Hey Alex,

    Good post, it’s hard to find a breakdown of different options for warehousing. Just one note though, with Bin Mandatory and using the Item Reclass to move between bins, it doesn’t create additional item or value ledger entries. Very helpful for reviewing other options that aren’t full blown WMS though!

  13. Biyat Samantaray

    With “Directed put-away and pick” flag TRUE for a Location, we can’t use Item Journal instead we use Whse. Item Journal. I’ve 2 questions.
    1) I’ve done many transactions for a Location, but now I want the “Directed put-away and pick” flag to be removed (FALSE). How can I do it? What tasks I’ll have to carry out in order to deactivate this flag?
    2) If I remove or deactivate this flag, what impact we’ll have? (Sales, Purchase, Transfers, etc)

  14. You can deactivate the flag and go back to the non-WMS setup. However, I would highly recommend you communicate this with your NAV partner and have them walk you through on how to do this.

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