Transportation Management (TM) in SAP S/4HANA Public Cloud offers a comprehensive suite of tools and functionalities to manage your transportation processes. Here are some key aspects that may reveal just how much the app can do for your business.
Fully mastering an end-to-end transportation management (TM) includes many steps, ranging from freight unit creation to cost distribution. SAP’s TM app can definitely help you to do so efficiently with its following key features:
- Efficient freight unit creation for various transportation scenarios: Freight units can be created based on different objects/documents depending on whether the basic process is an inbound, outbound, or stock transport process by using Freight Unit Building Rules. The following processes can create freight units: Outbound to Customer with or without warehouse management, Sales Scheduling Agreements, Inbound from Supplier, Stock Transfer with Delivery, Lean Customer Return, Return to Supplier, Advanced Intercompany Sales and Advanced Intercompany Stock Transfer.
- Streamlined manual transportation planning across all modes: The manual transportation planning process supports different modes of transport: road, rail, air and sea and consists of four steps. The first step is to perform manual planning, where freight units are assigned to freight orders or freight bookings. Next is the subcontracting step, where you assign a carrier to your freight orders or freight bookings. Receiving the carrier’s confirmation comes third. Both sending the subcontracting request and receiving the confirmation can be done via EDI. The final step is to trigger the creation of the delivery. This can be done for individual or multiple freight orders or bookings manually or via a background job.
- Optimized external transportation planning with seamless integration: The external transportation planning process supports the road and rail modes of transport and consists of four steps, independent from the base process and the mode of transport that you use. The first step is to review freight unit details, where a dispatcher may want to focus on blocked freight units only at this stage of the process. Once the freight units are OK, they are sent to the external system. The second step includes planning the freight units in the external system, where freight orders are created, freight units are assigned to them and they are subcontracted in the external system. When set to ‘ready for transportation execution’ in the external system, the planned freight orders are returned to SAP S/4HANA Public Cloud. Step three consists of monitoring the freight orders created in the external planning system and step four is when the deliveries are created.
- Comprehensive transportation execution and document management: This step manages the execution of the freight orders or freight bookings, including tracking and monitoring.
Preparing the required documents for your transport (like CMR and Bill of Lading) is also part of this step. (Please note that only the European template of the CMR is available in SAP TM Public Cloud)
This step also includes warehouse processes being triggered as these are closely connected with Transportation Management. You can combine IM storage locations and EWM managed storage locations with Transportation Management. When the storage location is EWM managed, you can use Advanced Shipping and Receiving (ASR). The freight order is used to communicate between TM and EWM and no transportation units (TU’s) need to be created.
- Accurate transportation charge calculation and rate management: You can calculate the charges for transporting goods in freight orders based on the rates you maintain in a rate table or locally in a freight agreement. You use a released freight agreement, which is a contract between you (the purchasing organization) and the carrier, as the basis for calculating transportation charges billable to you by your carrier. You can also use a charges template when a valid released agreement is missing between the purchasing organization and carrier. Once charges are calculated successfully without calculation errors, you perform follow-on cost distribution activities in the freight order.
- Effective freight settlement for financial accuracy: Freight costs calculated for the freight documents (freight orders and freight bookings) are to be posted in financial accounting to record such costs in accounting as accruals and to pay the carriers or freight forwarders. Once the freight documents are in a status in which the transportation has been initiated or completed, the freight costs can be posted to financial accounting. The invoice received from the carrier or freight forwarder is verified against the expected costs calculated in the freight document. The invoice received from the carrier or freight forwarder is verified against the expected costs calculated in the freight document.
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Precise cost distribution for consolidated freight orders: Typically, freight to several customers is consolidated in a freight order. This leads to the question of how to allocate the freight costs invoiced by the carrier for the freight order to the delivery items that have been transported with the freight order. So you need to break down the aggregated freight cost of the freight order to the level of a delivery item.
So far, so good. But if you are considering even more advanced transportation management, then the following essential features may be just what you are looking for. - Customizable transportation cockpit for tailored planning: Create an entirely customizable cockpit to use as manual transportation planning or transportation follow- up, depending on your role as user.
- Seamless warehouse integration with advanced shipping and receiving: With the Advanced Shipping and Receiving functionality, you can integrate IM (inbound and outbound scenario’s) and Cloud EWM warehouses (only outbound scenario) without the use of transportation units. Freight Orders can be used directly in the warehouse.
- Streamlined integration with logistics service providers: With this integration you can request a carrier for fulfilling a transportation request. You can initiate the subcontracting process by sending a subcontracting request to a decentralized business network or to a carrier system. The carrier can send you a confirmation for executing the subcontracting request. Once the transportation service is executed by the carrier, you receive the invoices.
- Sustainable transportation management with CO2 tracking: Greenhouse gas (GHG) emissions in the transportation sector are increasing steadily. TM allows you to organize your transport in a cost-efficient AND sustainable way by building freight units in such a way that it uses the available truck capacity optimally. More specifically, TM allows you to specify carbon dioxide (CO2) emissions per weight and distance unit for your trucks. These CO2 emissions are taken into account during manual and automatic planning and displayed in your road freight orders.
Solid choice
All the above features make SAP S/4HANA Public Cloud a solid choice for managing transportation processes efficiently and effectively, especially for any basic transport needs. However, if your company requires more advanced automation and optimization in transport planning, integrating an external planning tool or consider SAP’s Transportation Management Cloud, Private Edition.
Interested to know more? Don’t hesitate to contact us for more information!
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