SAP EWM vs WM

Organizations are using SAP warehouse management applications to properly manage their inventory and optimize goods movement flow. SAP has provided two such applications for the same, i.e. Warehouse Management (WM) and Extended Warehouse Management (EWM). Depending on the requirement of the organization regarding their business processes, complexity of the warehouse, and volume of inventory, they can choose these applications. In this tutorial, we will see the differences between SAP EWM vs WM, which will be helpful for an organization to take a call on which application meets their requirement.

Overview of SAP WM

SAP Warehouse Management (WM) application is the solution for managing and processing all the goods movement in the warehouse. It also assists in maintaining stock inventory in warehouses that are complex in nature. To have a timely and effective solution to the company’s logistics requirement, it is essential to have SAP WM implemented. The SAP WM helps in supporting the warehouse process by:

• Defining and managing the structure of the warehouse
• Harmonizing goods movement using advanced stock placement and stock removal strategies
• Storage bin determination for inbound receipt in the warehouse
• Storage bin determination for stock removal in case of outbound shipment
• Internal warehouse processes like stock movement within the warehouse, physical inventory, etc.

Several activities that take place within WM are initiated in Inventory Management. For example, goods receipts, goods issues, and posting changes are initiated in IM, and subsequently through the interim storage areas, processed in WM. Warehouse Management also has an interface with other core modules like Sales and Distribution (SD) through the shipping module to process outbound delivery documents for picking. It has an interface to Quality Management (QM) which allows the warehouse to track and manage inspection lots that are stored in the warehouse. Interface with Production Planning (PP) helps in providing raw materials to supply areas in production.

Overview of SAP EWM

SAP Extended Warehouse Management (SAP EWM) is a warehouse management system which simplifies complex supply chain logistics process and optimizes inventory tracking. This helps the warehouse control various distribution processes and also provides operational visibility.

Basically, SAP EWM has all the basic and core functionalities as that of SAP WM but in addition, SAP EWM offers solutions to several other advanced levels of warehouse and business processes. These help the warehouses in getting the solution to the issues which could not be resolved by SAP WM. Also, most of the features in EWM are available in SAP standard, which mitigates the risk of going into the enhancements. Like WM, the EWM also has an integration with SAP core modules of IM, SD, PP, and WM.

From a configuration standpoint, Plant and Storage location in ERP is assigned to the Warehouse number in WM and then the WM warehouse is linked to the EWM warehouse as shown below. For more details, refer to the tutorial on SAP EWM Architecture.

The next section outlines the various additional and advanced functionalities which are offered by the SAP EWM solution and not supported by SAP WM.

SAP EWM vs WM – Key Differences

The below table lists the differences between SAP EWM and WM functionalities.

SAP EWM Advantages

The following are advantages of SAP EWM:

• SAP EWM supports both simple and complex processes within the warehouse, at a granular level.
• SAP EWM is very flexible and provides automated solutions to manage inventory efficiently at the bin level.
• SAP EWM is highly suitable for a complex warehouse where the goods movement volume is very high.
• With resource management functionality in EWM, it efficiently utilizes resource capacity to reduce warehouse costs.
• It standardizes warehouse processes to increase inventory accuracy and business productivity.
• It helps in enabling automation of high-volume transactions which reduces the scope of error, increases posting time and speed.
• Voice picking functionality in EWM enables shorter search time, less error during picking, and direct response to the system.
• Mixed and layered pallet building is also possible with SAP EWM. This enables flexible picking in a single pick run for multiple customer orders.
• SAP EWM is also capable of advanced tracking after setting up labor structures and standards which helps in tracking the time and attendance of laborers, performance evaluation, shift management, etc.
• SAP EWM gives the warehouse complete transparency of the process, labor, and stock level in the warehouse.

SAP EWM Disadvantages

There are a few disadvantages of EWM, namely:

• The complete set up of EWM takes a lot of effort and rigorous testing.
• The cost of implementing EWM is higher than WM in terms of the number of consultants involved for ongoing support.
• EWM is not a very user-friendly application due to several transactions and process steps involved. Hence, it requires a lot of training for end-users.
• For Non-S4 HANA, EWM is coming in a decentralized version which requires the additional cost of the system and additional efforts for the integration set up with ERP.

Which Option to Prefer: SAP EWM vs WM?

SAP WM is the simpler version and easier to implement. It is a user-friendly application that can be implemented and adopted quickly without much effort and cost. On the other hand, SAP EWM is the solution to all the basic and complex warehouse processes. It has advanced features and much more than what SAP WM could offer. Although implementing SAP EWM requires a lot of time, effort, and cost, but once implemented, it will be a stable solution for the long term.

Looking at all the above pros and cons, and considering that the SAP is going to sunset WM application in a few years, it is highly recommended to opt for SAP EWM for a new greenfield implementation. The companies already using the SAP WM application are also migrating to SAP EWM.

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Did you like this tutorial? Have any questions or comments? We would love to hear your feedback in the comments section below. It’d be a big help for us, and hopefully, it’s something we can address for you in the improvement of our free SAP EWM tutorials.