D365 Supply Chain Management Pro Tips


Supply chain leaders are always looking for ways to improve, and few things are more important to a profitable warehouse operation than efficiency. Microsoft Dynamics 365 Supply Chain offers multiple features that will modernize the way you manage your distribution centers.

By updating the way your warehouse management system guides work orders, directs picking, and manages your fulfillment strategy, you can optimize your warehouse workflows for a more efficient process overall. These features also reduce waste and create a safer workspace for your team members.

To help you make the most of Microsoft D365, the supply chain experts at Blue Horseshoe put together a series of pro tips to help you improve your operations and maximize efficiency.

Cluster Picking

Picking piece orders one at a time is cumbersome and labor intensive. The process is inefficient, as it requires your team to make multiple trips back and forth throughout the warehouse.

Cluster picking is a picking method that allows your team to gather items for multiple orders on a single pass. This is one of the many picking options available in Microsoft Dynamics 365 Supply Chain Management. Aided by a mobile device, team members can view item numbers, locations, and quantities for a picking route that fulfills up to eight orders at a time.

D365 SCM allows for a variety of parameters when creating picking workflows and sequences. While this is a more efficient way of picking orders, it does require some device setup on the front end to ensure the process is carried out smoothly. Learn more about how to get started with cluster picking in Dynamics 365 for Supply Chain here.


Cross-docking is a logistics strategy that streamlines order fulfillment by moving products directly from inbound to outbound staging areas with no storage in between. As production items arrive from manufacturers or other suppliers, the product is immediately moved to fulfill open sales orders based on custom settings. Microsoft Dynamics 365 provides a number of tools that allow you to set up cross-docking in your own warehouse according to different supply chain and sales order requirements.

While this will take careful planning, there are multiple advantages to this type of operation. Not only does it prevent over-processing and unnecessary movement across the warehouse, cross-docking also creates a more efficient workflow that still allows you to maintain item tracking throughout the process. Discover three ways you can set up cross docking using Microsoft D365 here.

Cycle Count Plans

Maintaining accurate inventory data is essential to running a healthy warehouse. Cycle counting is a strategy to gauge the average accuracy of your inventory without completely shutting down operations. By counting a sample of your inventory on a regular schedule, you continuously prevent inaccuracies and reduce the need to run full counts as often.

Cycle counts must be completed on a regular basis in order to be effective. Microsoft Dynamics 365 helps you to create cycle count plans that ensure your inventory is counted on a weekly, bi-weekly, monthly, bi-annual, and annual schedule. You can also specify certain parameters or employee workflows for the counting process. These include setting locations or zones, organizing item categories according to priority, and including or excluding empty locations. Follow these steps to set up your custom cycle count plan with D365.

Inbound Inventory Quality

Inspecting your inbound inventory for quality before shelving helps prevent wasted space in your warehouse and reduces the risk of customers receiving damaged items. Your employees can use Microsoft Dynamics 365 Supply Chain Management on a mobile device to complete a quality check during the receiving process and either accept or reject inventory on the spot.

Depending on the input at this initial stage, Dynamics 365 will then automatically adjust the scheduled putaway process to reflect new quality orders for that shipment. You can also tailor this to a custom quality check work template.

Five unique configurations will help you make the most of the program’s ability to assist with inbound inventory checks. Learn how Microsoft Dynamics 365 can enhance your warehouse’s quality control process here.

Pick Line Grouping

Imagine your employees are completing a work header with multiple picks from the same product location, or are fulfilling multiple sales orders for a single item. Rather than returning to the item location multiple times, you can consolidate the work header’s total quantity for each item number into a single picking directive.

As part of Microsoft Dynamics 365, pick line grouping allows employees to complete multiple work lines at once. While it has both advantages and limitations to this strategy, it typically offers a more efficient way to accomplish the same work.

To set this up on your warehouse employees’ mobile devices, you will need to adjust the settings on whichever mobile device menu you use. See how you can use D365 to enable pick line grouping as part of your fulfillment process.

System-Directed Picking

System-directed picking is a function of Microsoft Dynamics 365 that will create automatic work orders for warehouse employees based on preset logic. By configuring your list of mobile device menu items, D365 can prioritize picking routes according to zones, shipping carriers, item type, customers, order priority, and ship date.

When employees sign into a certain zone or other menu item, the system automatically pushes assignments to that worker’s mobile device until all work IDs are completed for that menu item. This reduces the need for physical pick tickets while cutting down on time spent gathering orders and planning picking routes. Instead, D365 can organize the work automatically. Learn how to set up your devices to take advantage of system directed picking here.

Work Header Breaks

Using the base function of Microsoft D365 Supply Chain Warehouse Management, you can set up work header breaks to direct work in the warehouse more efficiently. Work header breaks tell the system when to automatically create new work orders based on zones or other categories.

There is a good amount of flexibility with the program to create your own zones based on natural divisions in your warehouse, such as location, barriers, foot traffic flow, or required equipment. Organizing your work orders by zone can decrease unnecessary foot traffic and maintain a more efficient warehouse operation overall.

Enabling work header breaks requires setting up sorting on your mobile device according to the zones you want to break by. Follow these steps to configure your zones and create work header breaks in Microsoft Dynamics 365.

Final Thoughts

Microsoft is constantly working to add new features to Dynamics 365 Supply Chain Management. If you want to learn how to best use these features to your advantage, Blue Horseshoe is here to help you create better warehouse processes.

As Vice President of Digital Transformation at Blue Horseshoe, Steve Shebuski guides businesses through their digital transformation journey. Steve has 20+ years of experience as a Program Manager/Design Lead/Project Manager implementing both Microsoft Dynamics AX / Dynamics 365 as well as tier I and tier II warehouse management and transportation software solutions. Steve's deep knowledge within the distribution industry and his innovative approach to solution architecture are the backbone of the solution implementation and deployment by Blue Horseshoe.

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