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Unlocking Efficiency and Scalability: A Decision Maker’s Guide to Migrating Your WMS to the Cloud
Having attended ProMat and Blue Yonder Icon this year, several trends stand out for us. With cloud-based operations management and warehouse automation, artificial intelligence and machine learning, digital twinning, and IoT, the possibilities for the future of Warehouse Management Systems (WMS) are staggering!
While all of these trends are exciting, today we’ll be focusing on cloud-based operations management - a key agenda item for many companies today, due to the complexities involved.
For any company getting started with a new WMS, this will be a no-brainer. Most WMS vendors offer cloud-first or cloud-only options that are SaaS-based - a clear signal that this is the future.
However, for companies with well-established on-premise legacy WMS operations, the decision to move to the cloud may not be so simple. While for such companies, the decision is not as easy, the question is not so much if but rather how: Should they opt for a SaaS version of their WMS or migrate their existing setup to a cloud-hosted solution?
In this article, we’ll cover the key considerations companies should review to answer this question.
Before we begin, let’s get into some of the fundamentals.
Why Migrate to the Cloud?
Cloud computing is one of the fastest-growing technologies in Information Technology (IT) today. In fact, Gartner has predicted that by 2025, 51% of IT spending will have shifted from traditional solutions to the cloud.
Moving your WMS to the cloud can unlock many benefits, including:
- Freeing up data centers
- Reliable service delivery with a guaranteed uptime of over 99%
- Lower implementation costs compared to traditional deployments
- Faster time-to-value, due to lower implementation costs and faster deployment
- Decreased hardware, facility, maintenance, administration and other labor costs
- Lower up-front costs due to subscription-based models
- Effortless portability, making it easy to relocate to new facilities
Overall, moving to the cloud reduces costs while improving efficiencies, which ultimately should drive higher customer satisfaction. However, the question remains, should you upgrade to a Software as a Service (SaaS), or should you migrate your existing system to the cloud?
Cloud-hosted or SaaS - What’s the Difference?
Cloud, SaaS, on-demand, or hosted solutions? Each of these terms applies to WMS solutions that are deployed outside of a company’s own infrastructure, but how they are set up has different implications for businesses.
It’s easy to get confused by the terminology, especially as these terms have sometimes been used interchangeably. Today, we see many companies weighing the pros and cons of cloud-hosted and SaaS solutions. Let’s take a closer look at these two approaches:
Cloud-Hosted Solutions: With cloud hosting, companies no longer have to maintain their own data centers to store data on servers. Instead, cloud technology is deployed to draw on a network of virtual and physical servers, providing greater flexibility, scalability, and reliability. In this case, the existing WMS is migrated in its current form without many changes or upgrades.
SaaS Solutions: By definition, SaaS solutions are cloud-hosted. With this setup, WMS vendors automatically release new updates, functions, and features to all WMS SaaS users. This ensures their systems are always up to date, using the latest technologies without much downtime or additional costs.
Both have their clear advantages versus on-prem solutions but is a SaaS truly worth it or is a cloud-hosted solution already good enough?
Considerations
Migrating a complex system such as a WMS is never easy. Below we’ve highlighted key considerations to support you in your decision-making.
#1 Data Security
One of the most critical jobs for any IT system is to ensure data is stored privately and securely. A data breach or cyber attack can cause a cascade of challenges.
If you’re considering migrating your system to a SaaS, it’s important to evaluate the security protocols of the solution. The same goes for a cloud-hosted solution, although with the latter you may have greater control.
#2 System Customization
Companies with well-established, or complex WMS operations will often have had their systems fully customized to suit their use case. When considering a move to a SaaS solution, that can become problematic.
By its very nature, a SaaS will push down system upgrades and optimizations automatically, which may overwrite any customizations and have a fundamental impact on operations. This is where migrating an existing system may benefit from a cloud-hosted solution instead.
However, this will come at the expense of benefitting from the latest features and functionalities of your WMS and may require ongoing support to keep upgrading the system. At the same time, ongoing customizations also pose a risk, as they require high amounts of CPU, reducing latency, bandwidth, and the performance of the system.
#3 On-Site Devices and Integrations
A WMS never exists in isolation. Being connected to many ancillary systems and processes, it is an integral part of any business. Thus before deciding to migrate to the cloud - whether as a SaaS or a cloud-based solution, the entire tech stack needs to be reviewed to understand how all of its parts will function with the WMS being hosted in the cloud. Here again, data security becomes important. Every single connection needs to be secured to keep your operations safe.
#4 Operational Success Factors
If you decide to opt for a SaaS solution, consider what it will take for your entire operation to adjust to a new system and what ongoing updates may mean for your day-to-day operations. For example, are you able to commit to training your team, and if so, how will that impact your operations? Is your team motivated to make systemic changes on an ongoing basis in order for the business to benefit from being on a SaaS? Are effective change management processes in place to guide such changes?
#5 The Business Case
At a time when many companies are focusing on reigning in costs and driving efficiencies, a move to a cloud-hosted or SaaS solution will require a strong business case. As part of this, all benefits and risks will need to be detailed and quantified to gain a clear view of the possible upside of this undertaking. Equally, the costs, effort and risk of not migrating must be assessed to fully weigh up all the options.
#6 The Right Support
The devil is in the details when it comes to developing a WMS migration strategy. Make sure to choose an implementation partner that provides a clear roadmap to keep your system stable, reliable, and performing well during the migration.
Factors to look for in an implementation partner proposal include:
- A full analysis of all your systems, identifying what can and what cannot be in the cloud
- A strategy to integrate all aspects of your system
- A comprehensive testing plan, including latency, bandwidth, and performance, ideally using automation testing for ongoing testing
- A detailed security review to ensure security certificates are in place and everything is secured
- A comprehensive contingency plan to mitigate potential disruptions and minimize any negative impact
Next Steps
Whether you migrate your existing WMS to a cloud-hosted solution or upgrade to a SaaS will depend largely on how complex your system is, and what other benefits (beyond cloud hosting) a SaaS solution can provide your business.
To understand if your company is ready for such an undertaking, make sure to examine your internal appetite for change and analyze the potential ROI of a small upgrade or a large-scale migration.
This is a complex topic and we'd love to get into more of the details with you. If you’re considering upgrading your WMS, get in touch with K2S and let’s start the conversation.
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