What's next for warehousing and transportation with Microsoft Dynamics AX

Jan 12, 2015
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In a recent Gartner report, the research firm's analysts noted that the Warehouse Management Systems (WMS) and Transportation Management Systems (TMS) capabilities presented in AX 2012 R3 are "comprehensive" for most midmarket needs. The analysts point out that the Dynamics AX WMS and TMS capabilities, based on an IP acquisition from the Blue Horseshoe, offers a starting point for many companies.

"In some cases, parts were rewritten, and efforts were restricted to wider, industry-agnostic functionality," the analysts write. "This is relevant for customers expecting the full industry depth of Blue Horseshoe's WAX and TRAX extensions when licensing AX."

For companies assessing their WMS and TMS needs, the right level of investment may not be obvious. Dynamics AX has improving warehouse and transportation capabilities out of the box. At the same time, third party providers continue to provide richer and more comprehensive solutions. Companies running Dynamics AX need to measure these options against their own operational and financial targets.

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Where It All Began

In July 2013, Microsoft announced that it has acquired Blue Horseshoe's Warehousing for AX (WAX) and Transportation for AX (TRAX) solutions.

"This technology will help Microsoft accelerate its Microsoft Dynamics AX supply chain management roadmap with plans to make the functionality available to the broader Dynamics AX channel partner and customer community," Blue Horseshoe wrote in a blog post at the time.

Bill Ducat, Blue Horseshoe's director of supply chain business development, said the company's technology has helped to bring more awareness of the need for good ERP-based transportation and warehousing capabilities. Referring to the Gartner report, he said Blue Horseshoe is promoting new, advanced versions of its WAX and TRAX solutions for Microsoft.

"The core of what we sold to Microsoft gave users all of the foundational elements for world-class warehousing and transportation," Ducat explains. "That included all of the rules-based workflow, rate shopping, carrier picking, radio frequency-enabled decision-making tools, and so forth. That's basically what anyone would expect in a WMS or TMS solution."

What's the Breakeven Point?

In assessing the estimated break-even point between using WAX and TRAX out of the box (via Dynamics AX) and buying a best-of-breed solution, Ducat says Dynamics users first have to decide whether they need a TMS and/or WMS - or if Dynamics' inventory management tool is enough. For example, he says a WMS doesn't generally come into play until a warehouse is at least 50,000 square feet in size and being run by 20+ employees. "If you don't have that many assets to manage," he says, "then a WMS isn't going to save you much."

Next, consider the firm's current setup. Is there a basic inventory management system in place? Are there are least 20-30 employees in the facility? Are the basics (good item data, for example) implemented? Are radio frequency data collection tools in place? "You have to go to grade school before high school, and to college before you get your Ph.D.," Ducat points out. "So while what we sold Microsoft contains a ton of functionality, if you have never done this before then it's time to focus on implementing good processes and super-high accuracies."

The Road Ahead

Looking ahead to the next 12-18 months, Ducat expects Microsoft to slow down its functionality enhancements as it moves its solutions into the cloud. "They're likely to focus a vast majority of their energy on getting that next release out," said Ducat, "and getting it stable and making sure that it has the right throughputs and performance [levels]."

According to Ducat, Blue Horseshoe has had its eye on developing a "next set" of automations and productivity improvements for Dynamics AX customers. That includes capabilities like cross-docking, voice integration, material handling integration, and retail store distribution. In most cases, these advanced features are the domain of best-of-breed WMS and TMS providers. Also on the roadmap, said Ducat, are industry-specific capabilities like catch weight (for protein food distributors, for example).

Blue Horseshoe will also roll out a new logistics execution solution known as "AXLE" that Microsoft Dynamics users will be able to utilize for fleet management. The logistics execution solution will provide real-time enterprise execution and supports transportation plans, freight reconciliation, general ledger, accounts payable and accounts receivable functions for private fleet, less than truckload (LTL), truckload (TL), route delivery, and brokered shipments.

Concurrently, Ducat says the vendor is working with Microsoft to better define Dynamics AX's TMS and WMS capabilities. Even with those enhancements in store, Ducat feels that WAX and TRAX have proven their value for Dynamics AX users over the last two years. "From the Blue Horseshoe perspective, what we sold to Microsoft is very good," says Ducat, "and very functional."

About Bridget McCrea

Bridget McCrea covers business and technology topics for various publications. She can be reached at bridgetmc@earthlink.net

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