Sap logistics and order fulfillment strategy

Use this title slide only with an image

Logistics & Order FulfillmentStrategy

Source: The Chief Supply Chain Officer Report 2014, Sep 2014, SCM World

Social Media

CatalogsWeb Sites

Mobile

Smart Devices

Kiosks

Retail

Customer CentricityMulti Channel Strategy requires Demand Networks

45%of enterprises are building direct-to-customer fulfillment capabilities

© 2015 SAP SE or an SAP affiliate company. All rights reserved. 2Confidential

http://icons.iconarchive.com/icons/archigraphs/mac/64/iPhone-icon.png

http://icons.iconarchive.com/icons/archigraphs/mac/64/iPhone-icon.png

http://icons.iconarchive.com/icons/visualpharm/office-space/128/touch-screen-kiosk-icon.png

http://icons.iconarchive.com/icons/iconshock/ecommerce/128/full-shopping-cart-icon.png

















Personalized SolutionsLot size of One requires Product Networks


52%of manufacturing companies expect to be highly vertically integrated in the next five years


“Help the world run better and improve people’s lives”

“To help people save money so they can live better.”

“…charting the course for a stronger, more sustainable future...”

“…dedicated to…enriching people’s lives”

“…to create a more prosperous society…”

Improve People’s LivesSpeed to fulfill individualized customer demand requires Internet of Things


87%of supply chain officers consider Internet of Things as important or interesting technology


Business StrategiesTranslating Business Realities to Business Strategies

Customer CentricityTransform Supply Chain & Logistics into Demand Networks

Personalized SolutionsConnect Products, Assets & Machines to Product Networks

Improve People’s LivesGain real-time network insight to action

with Internet of Things


Demand NetworksTransform Supply Chain & Logistics into Demand Networks

Planning MattersAggregated demand leads to short-term forecast accuracy < 70%* Business Concept: 3 Dimensional Planning

Be Responsive< 10%* of suppliers are directly connected with their customer’s supply chainBusiness Concept: Business Networks

Fulfill to PleaseAbout 10%* of world-wide GDP is related to Logistics spendingBusiness Concept: Connected Logistics PLAN – RESPOND – DELIVER

*Source: Several SAP Benchmarking Reports and Industry Analyst Reports


SAP Solution StrategyConnect your Company Strategy with your Customer & Product Strategy

SAP HANA Platform

Product Networks

Personalized Solutions

Internet of ThingsImprove People’s Lives

Demand Networks

Customer CentricityPlan

Respond

Deliver

Design

Produce

OperateMonitor


Demand NetworksCustomer Centricity – Demand Networks – Plan/Respond/Deliver

Sales, Inventory and Operations Planning Demand Management Demand Network

Response and Supply Management Production Planning and Scheduling Response Network

Warehouse Management Transportation Management Logistics Network

man

aged

clo

udpublic cloud

on-premise

Plan Respond Deliver

SAP HANA Platform

SAP Business Suite 4 HANA

Plan Respond Deliver

Real-time Network Insights


Increasing market volatilityMajor shifts in customer demand volume, increasing regulations, new competitors

Escalating customer expectationsCustomer is demanding high-quality, flexible delivery becoming the #1 logistics objective

Declining logistics performanceImpact of disruptive events and technology changes while cost budgets stay the same

The role of logistics is changingGlobal business drivers impacting logistics

Complexity

Delivery Performanc

e


Major challenges for logistics and distribution

Cost pressureLogistics cost average 10% of revenue and are still increasing, bearing optimization potentialTransparency remains vagueLogisticians require process control along with real-world based insights for rapid and effective decision makingIsolated operations at logistics partnersManufacturers, freight forwarders, carriers and retailers operate independently


Strategies for logistics and order fulfillmentLogistics optimization Translate constraint-based manufacturing and inventory optimization to

logistics capacities Differentiate in logistics with planning and response management Evolve from goods fulfillment to e-commerce business

Real-time insights and control Connect logistics to the internet of everything for business Simplify material flow and increase warehouse efficiency Provide insights into the network for effective and responsive decisions, and

execution

Logistics connected Orchestrate strategic and medium-term planning for manufacturing

companies, freight forwarders, carriers and retail companies on one platform

Determine best mix of carriers to meet business goals Sense and respond to logistics insights


Strategies for Warehouse Management

Introduce optimization techniques Slotting and constrained-based planning in the warehouse Warehouse layout optimization

Increase warehouse efficiency through Internet of Things Augmented reality for warehouse workers Material flow system and warehouse automation

Simplify material flow Seamless flow between Make and Deliver through production warehouse Handle returns as volume business (up to 30% in e-commerce)

Optimize warehouse and distribution operations by combining optimization techniques with the end-to-end logistics process across a warehouse

Dock Appointment Scheduling Manage the inbound and outbound flow to and from warehouse dock doors. Reduce delays and fees from carriers and increase service levels. Maintain and update appointment with carriers.

Warehouse Management Optimize processes, resources and assets in the warehouse. Manage quality, safety, automation, inventory in end-to-end process optimization combined with state-of-the art analytics.

Lower customer order cycle time

Where picking, packing, and shipping are automated

More orders shipped on time Where warehouse process is optimized based on shipping times

6%

48%

Warehouse Management


“We deployed SAP EWM at five large sites. It has helped us raise productivity, reduce costs, improve the customer experience, and become a safer place to work. We are seeing less travel time, fewer unnecessary exits from the forklifts, shorter loading and unloading times, and a more accurate order picking process.”Venkat Paruchuri, Director of Supply Chain IT, Dr Pepper Snapple Group


Strategies for Transportation Management

Introduce optimization techniques Optimize asset positioning through transportation resource planning Load planning and optimization

Differentiate with planning and response management Real-time strategic planning and simulation of distribution networks Synchronize capacities between shippers and service providers

Operate on one supply chain execution platform Orchestrate strategic and medium-term planning for manufacturing

companies, freight forwarders, carriers and retail companies on one platform

Provide insights into the network for effective decisions and execution


Enable companies to better meet transportation demands with streamlined processes, decreased costs, improved compliance and flexibility

Freight Planning and Optimization Optimize and balance freight costs and constraints.

Transportation Requirements ManagementCentralize transportation requirements management, from entry to final settlement.

Freight Tendering Create an automated environment for freight tendering.

.Carrier Booking

Automate a collaborative environment for carrier booking.

Lower spend When transportation is integrated with SAP ERP and partners

Less invoice errors

With automatically calculated and distributed costs

13%

22%

Transportation Execution and MonitoringExecute and monitor transportation and planning

Freight and Forwarding SettlementManage and settle freight agreements for carriers and customers.

Transportation Management


“ We have been quick to realize the benefits of SAP software, and our customers have responded positively. SAP Transportation Management and SAP Event Management have given us a competitive advantage in a challenging market, and we are confident they provide the ideal platform to drive future growth.”Paul Momege, IT Director, Norbert Dentressangle, Freight Forwarding Air & Sea Division© 2015 SAP SE or an SAP affiliate company. All rights reserved. 17Confidential

Cargill improving visibility with SAP Transportation Management


Strategies for Logistics Networks

Sense and respond to logistics insights Alert stakeholders and adapt business processes Real-time reporting, analysis for insight-into-action and risk mitigation

Manage freight strategically Determine best mix of carriers to meet business goals Monitor compliance with agreements for both sell and buy side

Connect logistics to the internet of everything for business Increase utilization and goods throughput with real-time location

services Accelerate delivery times with reduced waiting times and automated

monitoring

Deliver the best-possible carrier services with

improved freight contracting, holistic partner collaboration

and transparency.

Strategic Freight Management Forecast and assess future transportation requirements. Request bids from carriers to address transportation needs, and negotiate contracts and agreements with carriers.

Sense and respond to logistics insightsProvide complete tracking of goods and assets in transit across the entire supply chain, allowing quick resolution of issues, lower operating costs, and limiting excess inventory.

Less transportation spend Where forecasts are dynamic and updated

frequently

Fewer unplanned costsThrough visibility into in-transit and network-wide inventory

20%

9%

Logistics Network


21© 2014 SAP SE or an SAP affiliate company. All rights reserved.

“Our aim is to gradually interconnect all modes of

transport – from waterways and roads all the way to the

railway”

Hamburg Port Authority - steering course for the connected port of the future


Balance customer service and delivery costs for greater

speed, efficiency, and sustainability

Logistics NetworkEnable cross-company coordination of logistics with strategic freight management and collaboration.

Efficient Logistics & Order Fulfillment



Logistics Network

Transportation Management Run multimode, domestic, or international transportation processes in one holistic solution

Manage advanced distribution centers and production warehouses with optimization capabilities.


Efficient Logistics and Order Fulfillment

SAP HANA Platform


Integrating and connecting logistics

Real-time insights

and controlOptimization Connected

Logistics platformWarehouse Management, Transportation Management and Track and Trace converged on one platform

Business suite integrationLogistics seamlessly integrated to financials, order-to-cash and procure-to-pay

Logistics networkOrchestration of collaboration between logistics partners, and track and trace in the internet of things




Mobile Enabled Experience

SAP HANA Platform

Track & Trace

Logistics and Order FulfillmentRoadmap

Recent innovations

Planned innovations Future direction


• Advanced production receipts/staging

• Multi-deep storage (for automation)

• Transit warehousing• Warehouse billing

• E-Commerce, B2C and retail focus

• Optimization and increased efficiency


• Manual Planning with Gantt Charts

• SAP HANA Smart business

• Collaboration portal

• Focus on logistics service providers

• Transit warehousing• Transportation

resource planning

• E-Commerce, B2C and retail focus

• Accelerated Supply Chain convergence

Logistics Network

• Connected Logistics through the Internet of Things

• SAP HANA Smart Business

• Broaden footprint of Internet of Things solutions

• Supply Chain Orchestration integrating Logistics Network


Use this title slide only with an image

Thank you!

Sap logistics and order fulfillment strategy

Software