CHAPTER 2

LITERATURE REVIEW

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2.0 INTRODUCTION
This chapter focuses on reviewing existing literature by various scholar on the research concept
of Warehouse Management systems. It further discusses the underlying theory, the Diffusion
of Innovation (DOI), by Rogers (1995; 2003) and reviews other instances where the theory and
the elements under focus were applied. The chapter also outlines the working hypotheses
guiding the study and finally outlines the conceptual framework. A concluding statement is
offered at the end.

2.1. WAREHOUSE MANAGEMENT SYSTEMS

2.1.1 An Overview
A warehouse management system (WMS) is a key part of the supply chain (Chopra & Meindl,
2003). It primarily aims to control the movement and storage of materials within a warehouse
or distribution center and process the associated transactions, including shipping, dispatch,
retrieval, picking, storage, putaway and receiving. Ramaa, Subramanya & Rangaswamy (2012)
assert that a warehouse management system (WMS) is a database driven computer application,
to improve the efficiency of the warehouse by directing cutaways and to maintain accurate
inventory by recording warehouse transactions. The systems also direct and optimize stock
based on real-time information about the status of bin utilization.

Warehouse management systems often utilize Auto ID Data Capture (AIDC) technology, such
as barcode scanners, mobile handheld computers, wireless LANs, quick response codes (QR),
quick response scanners (QR Scanners) and radio-frequency identification (RFID) to , to
monitor product flow within the warehouse facility or distribution center (Raama et al, 2012).
Once data has been captured into the system, by means of some of the aforementioned input
devices, there is either batch synchronization or a real-time wireless transmission to a central
computer database. The database can then provide useful reports about the status of goods in
the warehouse. According to Raama et al (2012), the primary function of a warehouse control
system is to receive information from the upper level host system, most often being the
warehouse management system, and translate it for the daily operations of the warehouse
facility.

2.1.2 History of Warehouse Management Systems (WMS)

Warehouse Management Systems have evolved over time, much like many other computer
software solutions on offer today (Rosing, 2017). Over the course of time, WMSs developed
from the manual systems that were in use in the medieval era, to the full blown computerized

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and complex systems they are today (Piasecki, 2012). Even though WMSs continue to gain
added functionality, the initial core functionality of WMSs has not really changed. The primary
function of a WMS is to control the movement and storage of materials within a warehouse
operation and process the associated transactions therein (Churcher, 2009). According to
Tomkins & Smith (1998), man used to store excess food and keeping animals for emergency
surplus in the early days of civilization. As men got more and more civilized, local warehouses
were introduced. In normal circumstances, merchandise was stored in connection with
shipping, trading, and manufacturing activities. During the middle Ages, improvement in
human knowledge gave rise to warehousing to handle the storage of shipped goods (Tompkins
and Smith, 1998). In late 1800’s in the United States, transportation between port cities and
inland cities were effectively provided by railroad. Freight cars were used as warehouses on
wheels, and were especially used in the grain harvest season. Shortages in freight cars induced
the railroad companies to partition the transportation and warehousing functions. Tompkins
and Smith (1998) advance that during this time period, the monopoly on both warehousing and
freight by railroad companies favored large corporations, giving them free warehousing
services with the use of the railroads. The warehousing facility was provided as an additional
service to transportation, and the service so provided was part of the clearance terminal.

As more and more grain and other commodities were being transported by rail, and in large
quantities too, there was need to keep track of all commodities, their quantities, and how they
moved in and out of these warehouse facilities. This led to the rise of pen and paper manual
system of managing the warehousing operations (Rosing, 2017). During this period, much of
the labor was also done manually as well. The Industrial revolution brought the warehouse into
the spotlight. Many business operation relied on the services of the warehouses to store produce
as well as other products such as wine and whiskey. There was need for better management of
inventories within the warehouse. As technology improved, so did the warehouse systems. By
the end of World War I, hand trucks were used for material handling in warehouses and
stacking was done by hand, and stacking heights were designed in 2- 3metre range. Fast
forward to World War II, the fork lift truck and wooden pallets were introduced. Stacking
height of merchandise was increased from 3 to about 9metres, nearly a 300 percent increase
due the mass production of forklift truck.

Fast forward to the 1960s and 1970s in the United States automated warehousing was the talk
of the day. This main concept was the Automated Storage/Retrieval Systems (AS/RS). With
the rise of computers, these AS/RS were being deployed in warehouses so as to move pallets
higher up the warehouse facility and computers could generate broad reports of inventory

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levels. The main factor which gave rise to this development was the doubling of the value of
business inventories. After the late 1980s the AS/RS systems became obsolete, mainly due to
the realization that excess inventories drove storage costs higher, thus more emphasis was paid
on reducing inventories, small batch production and Just in time delivery (Tompkins & Smith,
1998). Consequently, this meant the need for a more encompassing system to manage the
warehouses, as most products being stored in warehoused were varied in nature, and there was
need to carefully manage these inventories such that operations would not come to an abrupt
halt because of the shortage of inventories in the warehouse.

With the wide use of computers in the early 1990s, many business oriented software systems
were slowly being developed. It was during this period that the development of full
computerized warehouse management systems gathered pace. Rosing (2017) advances that by
the end of the decade, companies such as IBM, SAP and ORACLE had developed standalone
warehouse management software solutions that managed the major functions of the warehouse,
and as time went on, more and more functionality was added to these software packages. More
developers entered the fray, resulting in varied WMSs. The 2000s saw the rise of Enterprise
Resource Planning systems (ERP), which were meant to help manage all the aspects of the
business enterprise. This lead to the integration on the WMS into the ERP systems, although
some packages still are standalone WMS. More and more functionality keeps getting added to
WMS systems and they are becoming more and more functional as days go by.

2.1.3 TYPES OF WAREHOUSE MANAGEMENT SYSTEMS

Faber & De Koster (2002) and Cable (2009) advanced that there are 2 broad types of WMSs,
and these are: - 1. The Manual WMS and 2. The Computerised WMS.

2.1.3.1 Manual WMS

Often referred to as legacy WMS, Bond (2015) suggests that these were the earliest attempts
at managing inventory in warehouses during the medieval periods. According to Rosing
(2017), the legacy inventory management systems began as far back as ancient Egypt, as people
sought way to manage their wheat and grain harvests so as to prevent famine in times of
drought. People began keeping records of grain on Papyrus. This system continued on through
the ages, and was widely used in the early 19th century when rail road transport transported
goods for long distances from place to place. The handling of the grain and other produce was
done manually by hand, and records of workers who performed this work were also recorded,
so that they could be remunerated accordingly at the end of the day. Once computers were
invented and used in business, the use of spreadsheets replace the ‘pen and paper’ records in

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warehousing and inventory management (Churcher, 2009), thus increasing information
accuracy and reducing the incidence of mistakes. All the while, jobs and tasks were done
manually. It was not until people began developing software that could handle data in a more
efficient way that warehousing management went full throttle Automated and computerised.

Fig 2.1: Types of WMS (Source: Faber & De Koster, 2002)

2.1.3.2 Computerised WMS

As the name suggests, this type of WMS is an advanced system that is controlled by and linked
to a central computer system (Faber & De Koster, 2002). The computer is at the heart of the
WMS as such, it directs all the warehousing activities, from receiving to dispatch and
everything else in between. This computerized WMS has 3 complements, i.e. input, processing
and output. The computerised WMS come in one of two offerings, as a standalone WMS (this
WMS comes as complete package not connected to any other system or software) or as a
module within an Enterprise Resource Planning (ERP) system. According to Faber & De
Koster, (2002) both the Standalone WMS and the ERP integrated WMS come in 3 versions,
and these are Basic, Advanced or Complex, with each subsequent version being more advanced
and with more functionality that its preceding counterpart.

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  Basic WMS – This system is apt to support stock and location control only. It is mainly
used to register information. Storing and picking instructions may be generated by the
system and possibly displayed on RF-terminals. The warehouse management information
is simple and focuses on throughput mainly.

 Advanced WMS – in addition to the functionality offered by a basic WMS, an advanced

WMS is capable of planning resources and activities to synchronize the flow of goods in
the warehouse. This WMS focuses on throughput, stock and capacity analysis.

 Complex WMS – With a complex WMS, the warehouse or group of warehouses can be
optimized. Information is available about each product in terms of where it is located
(tracking and tracing), what is its destination and why (planning, execution and control).
Further, a complex system offers additional functionality like transportation, dock door,
and value added logistics planning which help to optimize the warehouse operations as a
whole

2.1.4 COMPONENTS OF THE WMS

Mulcahy and Sydow (2008), state that a WMS program has three major interacting information
components that ultimately enable the WMS to execute product or order transactions. These
are the Input Component, the Processing Component and the Output component.

2.1.4.1 The Input Component

The input component of the warehouse includes all the input devices that interface with the
warehouse staff and are used to capture data into the main computer (processing) systems. Most
WMS capture product and inventory information using media such as Barcode scanners (fixed
or mobile handheld), Quick Response Code scanners (fixed or mobile handheld). These
Barcode and QR code scanners are used mainly at receiving and are connected to the
Warehouse computer system. They are also used when picking items from their locations in
the warehouse. These scanners user optical lenses to read barcodes and QR codes. The other
input medium used in the warehouse are the Radio Frequency Scanners. These devices, unlike
QR or Barcode scanners, use queries over radio frequency to accept transactions when entities
are in proximity to each other. RFID go one step further and can track inventory volumes within
the warehouse. In this case, all items in the warehouse are attached an RF chip that transmits a
radio wave. The RF scanner picks this wave and identifies the product. Some of the input
components are illustrated in the diagrams below.

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 Fig. 2.2: A Barcode Scanner & Barcode (Source: www.kestonics.com)

Fig. 2.3: A QR Code Scanner & QR code (Source: www.kestonics.com)

Fig 2.3: A RFID Scanner & RFID Transponder (Source: www.kestonics.com)

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2.1.4.2 The Processing Component
This is the main component of the WMS, where all the magic happens. The processing
component usually consists of three interconnected systems in the case of an ERP integrated
WMSs system, whereas in a standalone WMS, there are 2 systems (Mulcahy & Sydow, 2008).
The systems are:

 The Host IT Computer: This is usually the ERP system, a programme that manages the
entire business enterprise. It focuses on (1) linking the organisation with its external
stakeholders like suppliers and customers using extranet technology, (2) Asset
management, ensuring that on-hand inventory tallies with the sales figures, (3) tracking
financial data such as income, expenses and calculates profits or losses, and (4) handling
all customer orders and relaying them to the WMS computer, which is one level lower.
The Host IT Computer acts as a ‘middleman’, connecting the WMS and the company’s
suppliers and customers.

 The WMS program Computer: This computer system hosts the WMS software. It is the
server that contains all the modules that are used by the WMS. It is mainly concerned with
(1) Balancing the inventory, (2) keeping all SKU data, (3) Allocating products to their
respective storage locations in the warehouse, (4) creating order labels, (5) Inventory
updates upon receiving goods or returns, (6) Direct pickers during order picking, (7)
allocate tasks to workers, (8) handle non-customer orders and other information, and (9)
Inventory quantity reorganization, inventory counts and inventory status. This WMS
programme computer is one level lower than the Host IT Computer system.

 The Warehouse Computer: This computer system is the one that is directly connected
to all the physical in the warehouse. It is connected to all the input and output devices used
in the warehouse facility. It is the component that interacts with warehouse workers and
is often referred to as the execution system of the warehouse. Other scholars like Richards
(2011) refer to it as the Warehouse control system (WCS).

2.1.4.3 The Output component

McCrea (2013) advances that the output component of a WMS mainly deals with the
production of documentation from the WMS. The main tool of the output component is the
warehouse printer, which is connected to the Warehouse computer. The output component
produces documents like price tags, barcodes, QR codes, load and consignment manifests,

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reports, inventory records, time sheets and many other documents that may be printed from the
WMS.

2.1.5 FUNCTIONS OF WMS

The functions of a WMS can be classified in one of two ways. First, Bartholdi and Hackman
(2014) make use of the broad stages through which inventory moves through the warehouse
facility or the distribution center and came up with 3 broad categories, that is, the Inbound
functions, the Internal functions, and the Outbound functions. Linde & Akerblom, (2016) on
the other hand, classified the functions based on the individual functions of the warehouse.
They assert that functions are either Basic (found in all WMSs) or High End (added extra
functionality depending on how complex and customized the WMS is) as shown in Fig 2.XX

A WMS, being a computer software package, using input devices such as fixed handheld
scanners (QR, Barcode and RFID), collects, analyses, and reports the information necessary to
move goods through a warehouse or distribution center. From this information, a WMS is able
to instruct employees on the best ways in which to perform warehouse activities (e.g., where
to put or where to find an item), and, as such, governs the flow and storage of products through
the facility. From the onset, as inventory is delivered to the warehouse, the WMS gets to work
immediately, processing inventories from receiving through to dispatch. Bartholdi & Hackman
(2014) state that WMS software is supplied as a set of modules from which the organization in
question must choose. Typical modules include but not limited to:

Inbound shipment control: Assigns docks and time slots to deliveries; records data on
incoming products and their characteristics; and assigns storage locations to those items.

Stock locator system: Manages all inventory locations (including pallets and forklift trucks)
and provides information for item putaway and picking operations.

Inventory control: Maintains information about the status of each item, cycle counting,
product shrinkage and spoilage, and damaged goods.

Order fulfillment: Develops and prints pick lists, bar codes, and other documents, and
estimates the requirements for labor and material handling in order fulfillment.

Outbound shipment control: Generates packing lists, manifests, and bills of lading; plans the
packing and consolidation of materials and the loading of the truck; and records information
on the shipment and vehicle.

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The modules, put together, form up the core of the WMS which perform and control all
warehouse functions. These functions are discussed in the following passages.

Fig 2.4: WMS Functionality (Source: Linde & Akerblom, 2016)

2.1.5.1 Advance Shipment Notice (ASN), Pre Receiving, Receiving)

When a company purchases goods from a supplier, the supplier acknowledges this purchase
with a vendor delivery note. Prior to the shipment of these goods, the supplier sends the buyer
an Advance Shipping notice (ASN). This notice act as a confirmations of dispatch of goods, as
it contains the list of all goods supplied. This ASN is sent via the electronic data interchange
(EDI) interface of the WMS. The Warehouse manager, in case of any discrepancies responds
to the supplier, so as to rectify such. When the goods are dispatched from the supplier, an
electronic delivery note is sent via the EDI module of the WMS, while a physical delivery note
accompanies the load. Linde & Akerblom (2006) advance that with the use of ASN, a supplier
can notify the one receiving the ordered goods as a pre-announcement of the shipment to come,
and the buyer can schedule for the receiving of the consignment.

Upon arrival of the consignment of goods, the goods are physically inspected and counted,
against the delivery note. If these tally, both the physical delivery note and the electronic
delivery note are signed. If the consignment does not tally with the delivery note, verification

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and clarification is done with the supplier, using the supplier interface embedded in the WMS
so as to rectify and correct the order. If the problem can’t be rectified, the goods are returned
to the supplier. Upon rectification of errors, data capture into the WMS will be done, with the
aid of input devices such as handheld or fixed barcode and QR code scanners. As this
consignment information is captured, it is stored in the main Warehouse server or in the case
of an ERP system, it is stored in the ERP server. Further, as data is captured, the system
automatically updates the inventory record in real time. Once the data capture is finished, the
WMS checks off the order as ‘received’ and cancels out the electronic delivery order.

2.1.5.2 Putaway & Location Management

Putaway is defined by Chopra & Meindl (2003) as the process by which items, after having
gone through the process of receiving and recording into inventory, are physically taken to their
specific and individual storage areas in the warehouse. When all the data capture is completed,
the WMS, in accordance to predetermined rules, assists with directing the goods to a staging
area, reserve area, storage area, or in the across of cross docking, to some area where it is
processed for leaving the facility again. Frazelle (2000) advances that the WMS may direct the
warehouse employee to the goods’ storage area and also prescribes either the shortest route to
take or the fastest putaway strategy in the case of multiple and different products being putaway
by the same employee. This is made possible by the warehouse space management module that
is fed onto the WMS system when it is installed into the warehouse initially. With other more
advanced and sophisticated WMSs, the warehouse employee will be directed to the goods
storage position via a stereo headset (Voice directed putaway) or by a series of flashing lights
(Put-to-light). When the goods are placed onto their designated position, a scanning process
can assure that the position and quantity placed there is updated into the WMS.

2.1.5.3 Reverse Logistics

Bartholdi & Hackman (2014) make the assertion that reverse logistics flow of goods into the
warehouse is a bit tricky. These goods maybe returns from customers or from user departments
within the firms. Bartholdi & Hackman (2014) opine that this process requires special handling
since the items coming in need to be reinstated into the system, and more often not always in
the same status the item was when it left the warehouse. It may be broken and overall not fit
for sales or use again, but it still requires to be tracked in the system so that it is recorded as
returns and listed as unavailable. In some cases, the transactions stretches as far back as the
sales transaction, so that refunds or straight swaps may be made in the case of faulty or damaged
products (Richards, 2011). The WMS helps track all these transactions and ensures that reverse
flow is done accordingly. This has a huge bearing on customer service quality (Richards, 2011)

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2.1.5.4 Task Management
One of the most important functions, apart from inventory management, that WMSs carry out
is that of task management (Bartholdi & Hackman, 2014). This function relates to the dispatch
of tasks and assignments to the warehouse staff in order to achieve higher productivity. Instead
of the staff having to go to the manager each time they are done with a task, new assignments
can be passed to the warehouse staff via handheld devices. Once the staff member checks in
for work for the day, the WMS allocates duties and tasks to each one. At the completion of
each allocated task, other outstanding tasks not previously done will be allocated to the next
free person. This reduces idle time, increase individual staff productivity and ultimately
warehouse productivity. According to Cable (2009), in some systems, priorities are attached to
some work order processing functions, such that the priority tasks are dispatched first and
others non-priority functions will be dispatched afterwards as the day wears on. More advanced
systems can create tasks that are distance and speed optimized, as well as create and dispatch
these continuously. Cable (2009) avows that such a scenario requires a lot of information on
the warehouse to be fed into the WMS, and this functionality is usually found fairly advanced
WMSs that utilize sophisticated algorithms. In other cases, the WMS records the time that
individual employees take to complete tasks, as well as the number of tasks that an employee
undertakes in a given period, e.g. in a week, or month. This will help in remuneration,
especially if workers are paid on wage basis.

2.1.5.5 Inventory Management

The main reason behind WMS is to enhance inventory management in warehouse facilities and
distribution centers (Linde & Akerblom, 2016). In accordance with this, the main overarching
goal of inventory management is to have a purchasing plan that ensures that products are
available when they are requested, without having too much or too little on average, thus
reducing the costs associated with holding excess inventories. With a WMS in play, all the
necessary parameters for the different products (holding costs, lead times, minimum stock
levels, stock velocity) must be input into the system, such that the system will determine the
minimum order sizes, and the reorder points, thus minimizing the overall costs. Furthermore,
inventory management also involves cycle counting functions (Cable, 2009).

Bartholdi & Hackman (2014) opine that the need for physical counting varies from facility to
facility, but with WMS, it is usually not necessary since the system can generate stock records
at the click of a button. The most common reason to conduct a stock count is for financial
accounting related purposes, e.g. calculating inventory shrinkage. In that case the entire

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inventory is counted and the results compared to the figures generated by the MWS (Bartholdi
& Hackman, 2014). Sometimes if there is a suspicion that a product has discrepancies in the
balance count, a count for that specific product is then carried out. Modern WMS software
support perpetual cycle counting, which is to allow for counting when stock units of an article
run out. When it is run out it is an opportunity to check the count, against the physical count so
as to ascertain that the figures to tally. With regards to the inventory visibility, inventory
management in WMS software involves features like lot serial control, status/hold assignment,
and the ability to tie stock units to barcodes. When stocks are gradually depleted from the
warehouse, the particular barcodes are removed from their respective lots and from the WMS
as well, thus allowing for visibility in as far as the stock numbers are concerned (Cable 2009).
The WMS also calculates the stock velocity (thus determining the slow moving and fast moving
lines) and estimates the possible dates when stock levels may run out, thus ensuring that the
management can plan for replenishment.

2.1.5.6 Cross Docking

In cross docking, goods receipts and dispatches are coordinated to such an extent that incoming
goods are directly transferred to the shipping department without being captured into the WMS
or put away into storage (Bartholdi & Hackman, 2014). Richards (2011) asserts that this is a
pure trans-shipping system, which aims to, among other things – reduce stocks at certain points
along the supply chain, increase warehouse efficiency by avoiding process steps, reduce the
throughput times of articles in the system, improve the services by making more frequent
deliveries as well as sort articles effectively according to destinations. Cross-docking not only
minimizes the stocks in the distribution system or at the cross docking point (CDP) but also at
the Point of Sale (POS).

2.1.5.7 Batch and wave management

Linde and Akerblom (2016) assert that this function applies to the generation and collection of
customer orders. When orders arrive and captured into the WMS, they need to be picked, and
the way they are picked, is such that each order is a task to a warehouse employee. The system
can handle priority orders or query-based aggregation of sets of orders that are suitable to be
picked sequentially (waving) or in collections (batches). With stock obsolescence in mind, it is
essential that warehouse management puts forward principles of stock management to be used
in the warehouse (Cable, 2009), such First-In-Fist-Out (FIFO) or Last-In-First-Out (LIFO).
The WMS will act according to these rules, and direct the pickers accordingly. If it is FIFO
being used, the WMS will direct the picker to the oldest stock first, and if it is LIFO being used,
pickers will be directed to the newer stocks. Cable (2009) asserts that other rules that can be

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used in Waving or batching include carrier restrictions, Stock Keeping Unit (SKU)
characteristics, type of orders, and pick types/methods.

2.1.5.8 Pick and pack management

When customer orders arrive, the individual items from the order have to be retrieved from the
storage positions. The act of retrieving these items to complete orders is called ‘order picking’
(Rushton, et al, 2000). The picking of orders may be done using different methods depending
on equipment used, automation level, batching/waving strategy and the unit structure it
concerns (Linde & Akerblom, 2016). When an order is raised, and captured, the WMS helps
to locate the positions of the individual items in the warehouse. It does this by accessing the
main database and locating were the goods in question were located during storage and then
producing an order report. Further, the WMS will determine the shortest and fastest route that
the picker has to follow in order to minimize the total distance travelled and traversed while
maximizing of efficiency and productivity.

Rushton e al (2000), advance that when picking the items from their storage position, some
WMS use lights to show the picker where the items are stored (pick-to-light) while others
communicate with the picker using an audio headset (voice-directed-picking). When the picker
locates the item, they have to scan it, so that it is ticked off the order and the inventory record
by the WMS. When the picking is done, all individual items in the order are consolidated
together, sorted and packaged into single packages as per the received orders. It is at this point
that protective wrapping is applied so as to protect the goods. After this, the package is labelled
accordingly and moved on to the nest station, which is the dispatch desk.

2.1.5.9 Replenishment management

As items are picked from the warehouse to fulfil customer orders, some stock keeping units
(SKU) get depleted with each subsequent pick. The artificial intelligence (AI) that informs the
WMS can calculate and ascertain just how much SKUs have been depleted, thus prompting the
staff to replenish the depleted positions depleted by the picking activities in SKUs. Either the
positions are based on assigning the same amount of space to all SKUs or they get a volume
that is based on how often they are picked (Linde & Akerblom, 2016). The WMS can also
calculate and determine the velocity of each product line in the warehouse facility, as such, it
can determine how much volumes should be added to certain SKUs, thus ensuring that there is
enough volumes for both the slow moving product lines and the fast moving product lines.
Linde & Akerblom (2016) state that in manual systems, these calculations are done manually
thus increasing the incidence mistakes, which can lead to under or over replenishment, both of

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which have huge repercussions. The WMS is handy as it helps determine the optimum levels
of stocks to be kept in the facility, ensuring that holding costs are kept at a possible minimum.

2.1.5.10 Quality Assurance (QA) and Value Added Services (VAS)

Quality assurance (QA) is important to a warehouse facility, as it has a direct bearing in as far
as customer service quality is concerned (Cable, 2009). It is important that in every aspect of a
warehouse operation, care is taken so as to ensure that every order that leaves the facility meets
the standards expected by the customer, or better yet, exceed these. In addition to QA, other
value added services (VAS), such as labelling, packing, attachment of price tags, are essential
in adding value and increasing service quality. The WMS has a function that is printer enabled,
which allows for the printing of price tags, shipping labels and other product information. All
these help to add value to the products from the warehouse as well as ensuring that the customer
order is identifiable and gets loaded into the right vehicle for delivery.

2.1.5.11 Shipping and manifest management

After all the orders have been processed and ready for shipping, the WMS prepares what is
called a ‘Cargo manifest’ or a shipping manifest. This document contains on it the vehicle
details, the driver’s details, the consignees’ (customers) details, the consignment details (a
description of all the goods carried by the vehicle) among other things. This function is usually
done by a transport management function that is embedded within the WMS system (Linde &
Akerblom, 2006). Once the manifest is produced, the customers are notified prior to the
consignment is shipped. In more advanced WMSs, the transport module goes as far as
prescribing the right sequence of deliveries that will ensure faster delivery, lower distances
travelled and cost savings.

2.1.6 BENEFITS OF EMPLOYING WMS

As mentioned before, there are many benefits that could accrue to organisations who adopt and
implement WMS technology in their operations. These include but not limited only to:-

2.1.6.1 Increased inventory visibility, traceability and accuracy,

Whether the goods are entering the facility, being transferred around, or exiting the warehouse,
it is important to have accurate and timely inventory information to keep the operations on
track and satisfy customers (Churcher, 2009). WMS enhances inventory visibility, which can
lead to increased efficiencies in all processing activities (Partida, 2012). Through the use of
real time interaction with the system using barcode scanners, QR scanners and even RFID

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trackers, the quality of the information gets as high as it can. This allows for a unified view of
inventory and traceability, so that the staff know where things are and also where they should
be or stored. Further, it enables tracing back to where, when and why something went wrong
(Landy, 2009). In terms of customer service, the effects of enhanced visibility and accuracy are
increased on-time deliveries, less expedited orders, as well as an overall reduction in reverse
logistics (Partida, 2012). Having more visible inventory obviously reduces the need to search
for inventory within the warehouse, thus, increased productivity.

2.1.6.2 Improved throughput, space utilization and capacity

By suggesting where goods best fit in the warehouse, the chance of maximizing the space
utilization is greatly enhanced. Having total and updated visibility in the warehouse also helps
take action that can improve space utilization (Bartholdi and Hackman, 2014). Furthermore,
having the system coordinate the actions to execute, the complexity of warehousing is taken
off the operators' shoulders. By allowing goods to flow more smoothly and swiftly through the
warehouse facility, the throughput is increased and hence warehousing capacity.

2.1.6.3 Improved labor productivity,

By streamlining and automating warehouse processes, bottlenecks can be effectively reduced.
By storing more efficiently with stratification and affinity analyses, allowing for automated
information exchanges and directed tasks, reducing the number of handling steps needed in
activities, getting rid of paper-based tasks, supporting running/perpetual cycle counting, having
multiple order processing, productivity of all resources naturally increases (Gill, 2007;
Richards, 2011). Through visibility, data can also be collected for productivity monitoring and
labor planning purposes.

2.1.7 DRAWBACKS OF WMS

One of the major drawbacks of WMS is the price. Many of these WMS software, as well as
many other business technology/software like ERPs, TMSs, Accounting software, and many
others are so pricey, some costing as much as US$200,000 (once off payment for a perpetual
plan for the leading e-business WMS software), according to Daniel Harris of
www.softwareadvice.com, and that is beside the costs associated with implementation,
training, customizations, process redesign, maintenance, upgrades, software support, licensing
fees and other recurring costs. There are however, other WMS licenses that offer monthly
payment plans, with prices going upwards of $2,000/month, depending on the package that an
organisation chooses from the choices available.

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2.2 THEORETICAL FRAMEWORK
Theories are formulated to explain, predict, and understand phenomena and, in many cases, to
challenge and extend existing knowledge within the limits of critical bounding assumptions
(Abend, 2008). The theoretical framework, therefore, is the structure that holds or supports a
theory of a research study, and introduces and describes the theory that explains why the
research problem under study exists. Asher, (1984) advances that a theoretical framework
consists of concepts and, together with their definitions and reference to relevant scholarly
literature, existing theory that are used for a particular study.

The process of adopting new technologies has been studied for over forty years. Sherry &
Gibson (2002) assert that one of the most popular adoption and diffusion models was
propounded by Rogers in 1962. A lot of research from various disciplines have used this model
as a basis for their studies. As one of the pioneers of Innovation diffusion, Rogers’s works
(1962; 1983; 1995; 2003) have proven invaluable and have remained relevant over the course
of time, in relation to innovation and technology Diffusion. It is Rogers (2003), Diffusion of
Innovation Theory, on which this research work was founded on.

2.2.1 HISTORY OF DIFFUSION STUDIES

The concept of innovation did not originate from studying high-end, sophisticated gadgets and
technology, but rather, its origins can be traced back to the field of Agriculture (Wani & Ali,
2015). In 1928, researchers studied the adoption patterns of farmers using newly developed
hybrid corn in their farms in the state of Iowa in the United States. Between 1933 and 1939,
the acreage occupied by the hybrid corn had increased from mere hundreds of acres, to
thousands (Wani & Ali, 2015). By 1940, the hybrid corn was used by more that 90 percent of
all Iowa State farmers (Ruttan, 1996). In 1943, Ryan & Gross (1943) then proposed the adopter
categories, dividing the farmers into groups, based on the time it took them to adopt the hybrid
corn. Rogers in 1958, carried on these studies and in 1962 published his first work, titled
“Diffusion of Innovations”. Over the years, many scholars took up the study and came up
with various theories, but most relied on the original works of Rogers (1962). Since the first
studies of innovation diffusion in the late 1920s, many scholars since have studied the
phenomenon and as a result several version of the Innovation diffusion theory have been
propounded. The table below shows the different versions of the diffusion theory.

The work of Rogers (1962) on the Diffusion of Innovation provides well developed concepts
which are useful for studying technology evaluation, adoption and diffusion. No wonder many
scholars have used this work as a basis in their studies. Fichman (1992) states that Many

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scholars such as Kwon & Zmud (1987), Moore & Benbasat (1991), Davis (1989), to name a
few, have all studied the diffusion and adoption of innovations, but their main ideas built up
from Rogers original work. Table 2.1 shows some of the theories of diffusion that have been
put forward by different scholars over the years.

THEORY MAIN AUTHOR(S)

Innovation Diffusion Theory Rogers (1962; 1983; 1995; 2003)

Theory of Reasoned Action Fishbein & Ajzen (1975)
Social Cognitive Behavior Bandurra (1986)
Diffusion/ Implementation Model Kwon & Zmud (1987)
Technology Acceptance Model Davis (1989)
T.O.E Framework Depietro et al (1990)
Theory Of Planned Behavior Ajzen (1991)
Perceived Characteristics of Innovation Moore & Benbasat (1991)
Tri-Core Model Swanson (1994)
Technology Acceptance Model II Vankatesh et al (2003)
Unified Theory of Acceptance & Use of Technology Vankatesh et al, (2003)
Table 2.1: Theories of Adoption and Diffusion (Source: Schmitt et al, 2007)

2.2.2 ROGERS’ DIFFUSION OF INNOVATION THEORY

The process of adopting new innovations has been studied for decades. One of the most popular
adoption models is described by Rogers in his book, Diffusion of Innovations (Sherry &
Gibson, 2002). Much research from a broad variety of disciplines has used the model as a
framework. Dooley, (1999) states that it has been used in disciplines such as political science,
public health, communications, history, economics, technology, and education. Stuart (2000)
asserts Rogers’ theory as the most widely used theoretical framework in the area of technology
diffusion and adoption and Medlin (2001) concurs with this, as she also made the assertion that
Rogers’ (1995) diffusion of innovations theory was the most appropriate for investigating the
adoption of technology, as evidenced by the fact that much diffusion research involves
technological innovations. Further, Rogers (2003) usually used the words “technology” and
“innovation” as synonyms, and often used them interchangeably.

Rogers (2003:13), defines “a technology” as a design for instrumental action that reduces the
uncertainty in the cause-effect relationships involved in achieving a desired outcome” On the
other hand, innovation is defined as “an idea, a practice, or an object that is perceived as new,

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whether or not it is objectively new as measured by the lapse of time since its first use or
discovery. Despite their different definitions, they are used in the framework to mean the same
thing. Also key to the theory, is Adoption and Rejection. Rogers (2003:177), opines that
‘adoption’ is a decision to “fully use an innovation/technology as the best course of action
available” and rejection was a decision “not to adopt the use of an innovation”.

2.2.2.1 KEY COMPONENTS OF THE D.O.I THEORY

Rogers defines diffusion as “the process in which an innovation is communicated through
certain channels over time among the members of a social system” (2003:5). As conveyed in
this definition, innovation, communication channels, time, and social system are the four key
components of the diffusion of innovations.

2.2.2.1.1 Innovation
An innovation is an idea, practice, or project that is perceived as new by an individual or other
unit of adoption (Rogers, 2003:12). For an object to be an innovation it doesn’t necessarily
have to be a new invention, rather, it may have been invented a long time ago but if individuals
perceive it as new, then it may still be an innovation for them. The innovation diffusion theory
therefore, seeks to explain how these innovations are spread, and how fast they spread as well
as try and explain the causes of such phenomena (Sahin, 2006).

2.2.2.1.2 Communication Channels

The second component of the diffusion of innovations process is the communication channels.
Rogers (2003:5), states that communication is a process in which participants create and share
information with one another in order to reach a mutual understanding. This communication
occurs via channels between sources. Rogers (2003:204) further states that a source is the
individual or the institution that originates a message, and a channel is the means by which the
message gets from the source to the receiver. To this effect, Rogers opines that diffusion is a
specific kind of communication that incorporates these communication elements: an
innovation, two individuals or other units of adoption, and a communication channel.

2.2.2.1.3 Time
Time, according to Rogers (2003), is the most ignored aspect of diffusion. Rogers argues that
the time dimension in the diffusion research gives it its strengths. The innovation-diffusion
process, adopter categorization, and rate of adoptions all include and depend on the time
dimension.

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2.2.2.1.4 Social System
This is the last element in the diffusion process. It is defined as a set of interrelated units
engaged in joint problem solving to accomplish a common goal (Rogers, 2003:23). Since
diffusion of innovations takes place in a social system, it is influenced by the social structure
of the social system. Rogers (2003:24), states that structure is the patterned arrangements of
the units in a system. He also claimed that the nature of the social system affects individuals’
innovativeness, which is the main criterion for grouping members of the social system into
different categories known in the theory as “Adopter Categories”.

2.2.2.2 ADOPTER CATEGORIES

The adoption of a new “innovation” does not happen simultaneously in a social system (Light,
1998); rather it is a process whereby some people are more apt to adopt the innovation than
others. Sahin (2006) opines that researchers have found that people who adopt an innovation
early have different characteristics than people who adopt an innovation later. Rogers
(2003:22) termed these different classes/categories of people as Adopters, and he defined the
adopter categories as classifications of members of a social system on the basis of
innovativeness. Braak (2001:144) describes innovativeness as a relatively-stable, socially-
constructed, innovation-dependent characteristic that indicates an individual’s willingness to
change his/her familiar practices. According to Rogers (2003) there are five established
adopter categories found within a social system, and these are.

 Innovators – These are people who want to be the first to try the innovation. They are
venturesome and interested in new ideas. These people are very willing to take risks, and
are often the first to develop new ideas. Very little, if anything, needs to be done to appeal
to this population.

 Early Adopters – These are people who represent opinion leaders. They enjoy leadership
roles, and embrace change opportunities. They are already aware of the need to change and
are comfortable adopting new ideas.

 Early Majority – These people are rarely leaders, but they do adopt new ideas before the
average person. Moreover, they typically need to see evidence that the innovation works
before they are willing to adopt it.

 Late Majority – These people are skeptical of change, and will only adopt an innovation
after it has been tried by the majority. Strategies to appeal to this population include

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 information on how many other people have tried the innovation and have adopted it
successfully.

 Laggards – These are bound by tradition and very conservative. They are very skeptical of
change and are the hardest group to bring on board. Strategies to appeal to this population
include statistics, fear appeals, and pressure from people in the other adopter groups.

Fig 2.5: Adopter Categories (Source: Rogers, 2003)

2.2.2.3 THE INNOVATION-DECISION PROCESS

Rogers (2003:172) described the innovation-decision process as an information-seeking and
information-processing activity, whereby an individual is motivated to reduce the uncertainty
about the merits and drawbacks of an innovation. The adoption process can be broken down
into five stages. Rogers (2003) says that although more or fewer stages may exist, at the present
time there seem to be five main stages. The five stages are: Knowledge, Persuasion, Decision,
Implementation, and Confirmation. Sahin (2006) opines that these stages typically follow each
other in a time-ordered manner.

2.2.2.3.1 Knowledge/ Awareness Stage

The innovation-decision process begins with the knowledge of an innovation. At this stage, the
individual/organisation learns and becomes aware of the existence of an innovation, and
subsequently seek information about the innovation, so that they know what it is about, what
it does and how it works and the advantages that could accrue from using the innovation as
well as the possible disadvantages of that particular innovation. Rogers (2003:21) asserts that

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the three type of knowledge that will come arise from this inquisition are: (1) awareness-
knowledge, (2) how-to-knowledge and (3) principles knowledge.
 Awareness-Knowledge: this represents the knowledge of the existence of the
innovation. This knowledge motivates the individual/organisation to seek information
and learn more about the innovation.
 How- to-Knowledge- This knowledge is on how to use the innovation correctly. Roger
(2003) considered this knowledge to be essential in the diffusion process and stated that
to increase the chances of adoption, an individual/organisation should have sufficient
information on how use the innovation before they trial the technology.
 Principles Knowledge: Sahin (2006) asserts that this knowledge includes the functioning
principles describing how and why an innovation works. It is possible to adopt an
innovation without this knowledge (Sahin, 2006), but the misuse of the innovation may
lead to discontinuance.

Fig 2.6: Stages of the Innovation-Diffusion Process (Source: Rogers, 2003)

2.2.2.3.2 Persuasion
According to Rogers (2003:176), when information has been sought, it results in either of two
things, that is, developing a positive attitude towards the innovation, or developing a negative
attitude towards the innovation. This is because the persuasion is more affective centered
(based on feelings), as compared to the Knowledge stage, which is more cognitive oriented
(Sahin, 2006). A lot of sensitivity is involved at this stage and the influence of other players in
the social system has a bearing towards the final outcome in this stage of the process. Sherry

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(1997) assert that while information about an innovation is usually available from experts and
scientific evaluation, potential adopters usually seek for such information from trusted friends,
colleagues and peers, whose subjective opinions are more convincing that those of experts.
Rogers (2003) also opines that, in addition, the attributes of Innovation also have a bearing
towards persuading the individual/organisation.

2.2.2.3.3 Decision
To use or not to use is the main idea at this stage of the process (Sahin, 2006). At this stage, if
the adopter has been persuaded of the benefits that could accrue to them from the innovation,
they make the decision to adopt the innovation. However, if they are not convinced/persuaded,
they may decide to seek further information or worse, decide to reject the innovation. Rogers
(2003:177) asserts that adoption is the decision to fully use an innovation as the best course of
action available, while rejection means not to adopt the innovation. Rogers (2003) asserts that
if an innovation has a partial trial, it is usually adopted more quickly, since individuals want to
try the innovation in their own situation and then come to an adoption decision. The decision
stage can yield a possible four (4) scenarios (Sahin, 2006), that is, either (1) the individual
adopts and innovation and continues to use it or (2) Adopts the innovation and later
discontinues use, or (3) reject the innovation and continue to reject the innovation and (4) reject
the innovation initially, but later adopts the innovation. Rogers (2003) asserts that group
influence on adoption can transform individual innovation decision into a collective innovation
decision.

2.2.2.3.4 Implementation
At this stage, the innovation is put into practice (Rogers 2003:6). There is still some uncertainty
pertaining to the innovation, because of the newness of the innovation in as far as the adopter
is concerned. Sahin, (2006) opines that the adopter may need assistance from change agents or
other forerunners of adoption before him, so as to reduce the uncertainty about the
consequences.

2.2.2.3.5 Confirmation
At this stage, the decision to use the innovation has been made, but the individual/organisation
looks for support for this decision. Rogers (2003:189) asserts that the decision may be reversed
if the unit of adoption (individual/organisation) receives conflicting reviews/feedback about
that innovation. Here, attitudes, are critical at this stage and depending on the support that the
individual/organisation receives, late adoption or discontinuance may happen (Sahin, 2006)

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2.2.2.4 ATTRIBUTES OF INNOVATION
Rogers (2003:232) labeled the innovation-diffusion process as ‘a process of reducing
uncertainty about innovation’. To this effect, he suggested 5 attributes of innovations that help
to decrease the uncertainty that members of a social system may have about a particular
innovation/ technology. These attributes, as Rogers (2003) suggests, are relative advantage,
compatibility, complexity, trialability, and observability. Rogers (2003:219) stated that
individuals’ perceptions of these characteristics predict the rate of adoption of innovations.
Rogers (p.221) went on to define the rate of adoption as the relative speed with which an
innovation is adopted by members of a social system, for example, the number of individuals
who adopted the innovation for a given period of time can be measured as the innovation’s rate
of adoption, e.g. 10 individuals per year or 8 companies per 10years, etc. The attributes of
innovation are the major focus of this research, together with the awareness aspect of the
Innovation Diffusion process.

2.2.2.4.1 Relative Advantage

Rogers (2003) defined relative advantage as “the degree to which an innovation is perceived
as being better than the idea it supersedes

2.2.2.4.2 Compatibility
Compatibility, according to Rogers (2003:15) is the degree to which an innovation is seen as
consistent with the existing values, past experiences, and needs of potential adopters.

2.2.2.4.3 Complexity
Rogers (2003:15) defined complexity as “the degree to which an innovation is perceived as
relatively difficult to understand and use. In comparison to other attributes, complexity is the
only attribute that is negatively correlated with the rate of adoption. Thus, excessive complexity
of an innovation is an important obstacle in its adoption, meaning it might deter or work against
an innovation being adopted.

2.2.2.4.4 Trialability
According to Rogers (2003:16), trialability is the degree to which an innovation may be
experimented with or tried on a limited basis. Trialability is positively correlated with the rate
of adoption. The more an innovation is tried, the faster its adoption is.

2.2.2.4.5 Observability

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The final attribute of innovation is observability. Rogers (2003:16) defined observability as the
degree to which the results of an innovation are visible to other members of the social system.
The more visible the results of an innovation are, the better its chances of being adopted by
others in the social system.

2.2.3 JUSTIFICATION OF USING ROGERS’ MODEL

Various scholars have studied the concept of innovation diffusion, and have proposed different
models. Fichman (1992) states that researchers usually focus on two different aspect of
adoption and these are: (a) the characteristics of an innovation and their consequences on
adoption and diffusion, as well as (b) the locus of adoption, that is, whether the adoption is at
organisational or at individual level. The table below (table 2.2) shows the various diffusion
models and their respective loci.

ADOPTION
LEVEL
THEORY MAIN AUTHOR(S)
INDI ORG.

Innovation Diffusion Theory Rogers (1962, ‘83, ‘95, 03) x x

Theory of Reasoned Action Fishbein & Ajzen (1975) x
Social Cognitive Behavior Bandurra (1986) x
Diffusion/ Implementation Model Kwon & Zmud (1987) x
Technology Acceptance Model Davis (1989) x
T.O.E Framework Depietro et al (1990) x
Theory Of Planned Behavior Ajzen (1991) x
Perceived Characteristics of Innovation Moore & Benbasat (1991) x
Tri-Core Model Swanson (1994) x
Technology Acceptance Model II Vankatesh et al (2003) x
Unified Theory of Acceptance & Use of
Vankatesh et al, (2003) x
Technology
Table 2.2: Diffusion of Innovation - Adoption Levels (Source: Schmitt et al, 2007)

This study sought to examine the diffusion of WMS, which is a business innovation, the
researcher concentrated on the diffusion models which are relevant to organisations. To this
effect, four (4) models were considered, (Rogers, 2003; Kwon & Zmud, 1987; Depietro et al,
1990; Swanson 1994). The reason being, in addition to studying adoption on an individual
level, they also considered adoption on an organisational level as well. Rogers’ model was
finally selected, as it is the original model on which many other models were built upon
(Fichman, 1992), it is the most widely used in the area of technology diffusion (Dooley, 1999)
and moreover, the abundance of literature on this model was also another huge determining

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factor in its selection. The Attributes of innovation were the main subject of concern in this
research study.

2.2.4 ROGERS’ DOI MODEL APPLIED

The Diffusion of innovation theory (DOI), in particular, the attributes of innovation (AOI), has
been used to study the adoption and diffusion of various Information technologies (IT) across
many fields by different scholars. Stuart (2000) mentioned several disciplines such as
medicine, communications, history, political science, economics, technology and education,
among others, in which Rogers Diffusion of Innovations theory was used. Dooley (1999)
concluded that Rogers’ theory was the most widely used in the area of technology diffusion.
Some of the studies that uses Rogers’s Attributes of innovation include: -

Wang, Lin, Chang & Hung (2011) conducted a study to investigate the diffusion of RFID
technology (a technology that is used in warehouses and distribution centers as a part of WMS
to monitor and track inventories) in Taiwan. Their research was also based on Rogers (2003)
Innovation diffusion theory and their focus was to find out the factors that affected the decision
to adopt RFID technology, a component of WMS, based on the innovation-decision process
and the Attributes of innovation. Their research conceptualizes the 5 attributes of innovation
(complexity, trialability, observability, compatibility and relative advantage) and how these
influence the uptake of RFID technology in logistics in Taiwan. They conducted a survey, and
administered a questionnaire to the respondents, and their studies concluded significant
relationships between the attributes of innovation and the diffusion of RFID in the logistics
industry in Taiwan. In addition they concluded that other factors, such as Organisational factors
and Industry factors were also important in the diffusion of RFID technology.

In the field on Medicine, Scott, Rodgers, Bize, Plotnikoff & Karunamuni (2007), used Roger’s
(2003) Diffusion of Innovation model to determine the factors influencing the adoption and
uptake of the Heart Health Kit (HHK) in Canada. They conducted a survey among health
professionals (Doctors, General practitioners and nurses), to determine the Attributes of the
HHK, influenced them to use the HHK as well as recommend it to their patients. They
concluded that among the 5 attributes of innovation, Observability and trialability were the
least in terms of influencing the used of the HHK. However, there was strong consistency for
the measures of Compatibility, Complexity, and relative advantage. Scott et al (2007) noted
that RA and Compatibility were the biggest contributors to the adoption and uptake of the
HHK.

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In the Banking Sector, Al Jabri & Sohail (2012) used the attributes of Innovation to study the
diffusion of Mobile Banking Applications in Saudi Arabia. They conducted a study to
determine the influence of Attributes of innovation on mobile banking apps that banks in Saudi
Arabia were offering to their clients as part of their banking services to improve their clients’
experience. Their study was in two parts. First, they conducted a focus group discussion and
then later administered a questionnaire to over 1500 respondents. The study concluded that
there was strong correlation between the characteristics of an innovation and its uptake in any
society.

Other studies by Schmitt et al, (2007; RFID in the Automotive industry), Stachewitz (2001;
Capacitive switches in Industrial controls), Kapoor et al (2013; Adoption of Interbank mobile
payment services), and many others, studies the Attributes of Innovation as a factor in the
adoption and uptake of different technological innovation. They all vehemently concluded that
these Attributes of Innovation had a huge influence in as far as adoption or the intention to
adopt technological innovations is concerned.

2.3 HYPOTHESIS DEVELOPMENT

2.3.1 Awareness & Knowledge
According to Rogers (2003:172), the initial stage of innovation diffusion is the awareness of
the existence of an innovation. This stage set in motion a chain of events that will eventually
lead to the adoption or rejection of an innovation. This chain of events, Rogers (2003:172),
terms it “The Innovation-Decision Process”. At this initial stage, which is essentially an
information-seeking and information-processing stage, the individual is motivated to reduce
uncertainty about the benefits and drawbacks of an innovation. Rogers (2003:175) asserts that,
upon learning about an innovation (through the communication channel in the social system),
organisation and individuals endeavor to acquaint themselves with as much knowledge about
the innovation as possible, so as to learn about the possible benefits that could accrue to their
organisations from adopting the innovation. To this effect, they exhaust as much time
researching about the innovation so as to be sure beyond doubt that they can benefit from the
innovation. The researcher therefore hypothesized that awareness and knowledge are key to
WMS diffusion.
H1: Awareness and knowledge is crucial to the diffusion of WMS

2.3.2 Relative advantage (RA)

Relative advantage refers to the degree to which an innovation is perceived as providing more
benefits than its predecessor (Roger, 2003; Moore & Benbasat 1991). Relative advantage as

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Rogers (2003) postulates, results in increased efficiency, economic benefits and enhanced
status. Past research by Rogers (1983; 1995; 2003) as well as Moore & Benbasat (1991) has
found that relative advantage of an innovation is positively co-related to the rate of adoption,
that is, as RA increases, so does the rate of adoption. McCloskey (2006) opines that when users
perceives greater RA or usefulness of a new technology over an old one, they tend to adopt it.
In the context of WMS, convenience and business advantages derived from the technology
have been noted. Therefore, the researcher hypothesized that, when organisations perceive
superior advantages offered by WMS, they are more likely to adopt it.
H2. Relative advantage will have a positive effect on WMS diffusion.

2.3.3 Complexity
Rogers, (2003:15) defined complexity as the extent to which an innovation can be considered
relatively difficult to understand and use. In comparison to other attributes, complexity is the
only attribute that is negatively correlated with the rate of adoption. Complexity is the opposite
of ease of use (Cheung et al., 2000). Ease of use refers to the extent to which an innovation is
perceived as easy to understand and operate. Research by scholars such as Gu et al. (2009);
Luarn & Lin (2005); and Venkatesh & Davis (2000) suggests that there is a strong impact of
perceived ease of use of new technology on its adoption. Complexity in use is a major factor
in adoption of an innovation. There is considerable amount of empirical research on business
innovations (such as RFID, Mobile Apps, ERP systems, Transport Management Systems, etc.),
to suggest that organizations’ intention to adopt and implement WMS is impeded by the
perceived complexity of the innovation (Moore & Benbasat, 1991). Much of the existing
literature on barriers of innovation adoption is predominantly related to technical complexity.
Organisations will be deterred t from adopting WMS if they find it requires too much effort, is
time-consuming or frustrating and they deem it complicated. The researcher therefore
hypothesized that perceived complexity inhibits adoption of WMS.
H3. Complexity will have a negative effect on WMS diffusion.

2.3.4 Compatibility
Rogers, (2003:15) advanced that compatibility is the degree to which an innovation is
perceived as consistent with users’ existing values, habits, organizational culture,
organizational goals, and present and previous experiences. Compatibility is a vital feature of
innovation as conformance with user’s lifestyle can propel a rapid rate of adoption (Rogers
2003). Compatibility is an important antecedent in determining organizations’ views towards
WMS adoption (More & Benbasat, 1991). In other diffusion studies, it has been vehemently
concluded that compatibility is highly influential in the adoption of virtual stores (Chen et al.

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2004), mobile payment systems (Chen 2008), and mobile banking systems (Koenig-Lewis
2010; Lin 2011). These studies found that compatibility had significant correlation with
innovation adoption and use. Thus, it is also likely that this relation between compatibility and
adoption will hold in the context of Warehouse Management Systems.
H4. Compatibility will have a positive effect on WMS diffusion.

2.3.5 Trialability
According to Rogers (2003:16), trialability is the degree to which an innovation may be
experimented with or tried on a limited basis. Potential adopters who are allowed to experiment
with an innovation will feel more comfortable with it and are more likely to adopt it (Agarwal
& Prasad 1998). Further support is given by Tan & Teo (2000), who argue that if customers
are given a chance to try an innovation, it will minimize certain unknown and hidden fears
about an innovation, and thereby lead to adoption. With service providers providing training,
workshops, assistance and onsite demonstrations on the use of WMS usage prior to final
purchase, fears about WMS incompatibility with existing systems can be reduced. This will go
a long way towards convincing and motivating organisations to adopt WMS. The researcher
therefore hypothesized that trialability will contribute positively towards WMS diffusion
H5. Trialability will have a positive effect on WMS diffusion.

2.3.6 Observability
The final attribute of innovation is observability. Rogers (2003:16) defined observability as the
degree to which the results of an innovation are visible to other members of the social system.
The more visible the results of an innovation are, the better its chances of being adopted by
others in the social system. Moore & Benbasat (1991) simplified the original construct by
redefining observability into two constructs: visibility and result demonstrability. In the
framework of Warehouse management, observability is defined as the ability undertake and
complete warehouse tasks quickly, reduce cycle time, reduce overall employee workloads,
increased order management efficiency, better space utilization and as well as reducing
inventory management costs and seeing the effect of WMS immediately, and conveying these
accessibility benefits to users and potential users. Through such exposure, customers gain
knowledge about mobile banking and its benefits, thereby facilitating adoption.
H6. Observability will have a positive effect on WMS diffusion.

2.4 CONCEPTUAL FRAMEWORK

A conceptual framework is a research tool that purposes to develop an understanding of the
situation under investigation. According to Randolph (2009) a conceptual framework considers
the theoretical and conceptual issues surrounding research work and forms a coherent and

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consistent foundation that will underpin the development and identification of existing
variables. This research sought to study the diffusion and adoption of WMS in Southern
Zimbabwe, by applying the diffusion of innovation theory as propounded by Rogers (2003).
The main focus of this research was on, firstly, the awareness and knowledge of WMS and
secondly, the Attributes of Innovations and how these have an effect on WMS diffusion in
Southern Zimbabwe. Fig 2.7 depicts the conceptual framework for the study.

Fig. 2.7: The Conceptual Framework.

2.5 CONCLUSION
The main focus of this chapter was to dissect through various previous literature from different
scholars, on the concept of warehouse management systems. In addition, focus was also given
to theory of Innovation diffusion, as propounded by Rogers (1995; 2003), which formed the
basis of the entire research. The rationale for the choice of this theory was also provided.
Further, the research framework and hypotheses that informed the research activities were
generated. The next chapter (Chapter 3) will deal with the research methodology, which
essentially details the structure of the research process and how data was gathered from
respondents.

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Bartholdi, J. & Hackman, S. (2014). Warehouse and distribution science. www.warehouse-

science.com

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