Transportation Management with SAP TM

Rudiger Fritz studied industrial engineering and management at TH Karlsruhe, specializing in company planning and focusing on logistics. He has been working at SAP AG in Walldorf since 2001. As a developer and architect, he has had a major influence in shaping and designing SAP TM and, in particular, the Transport Cost Management 2006. From 2001 to 2005 he was involved in the development of SAP EWM (Extended Warehouse Management) and the ERP component SAP LES (Logistics Execution). As a Development Architect, he will continue to support the development of SAP TM in the future. Till Dengel is a graduate in business administration (BA), specializing in the freight forwarding and transport area. He spent five years working in the freight forwarding area, before joining SAP in 2000 as a Senior Consultant. During his consulting activities, Till Dengel worked in the Transport and Logistics areas in the Chemistry, Pharmaceutical and Freight Forwarding sectors before taking over project management responsibility for logistics service providers in 2004. Since 2007, Till Dengel has headed up the IBU Travel & Logistics Services, which is responsible for the product definition and strategic direction of SAP in the logistics service providers, aviation, post and rail company sectors. Dr. Jens Gottlieb is a computer scientist and has worked at SAP AG in Walldorf since 2000. He has written more than 25 scientific publications in the area of heuristic optimization techniques, has edited six books and was a key figure in the development of the Vehicle Scheduling and Routing Optimizer at SAP, which is used in APO TP/VS and in the new solution SAP TM 6.0. Jens Gottlieb was the Development Architect responsible for the optimization algorithms in the transportation area and headed development projects both in APO TP/VS and in SAP TM 6.0. Since 2008 he has been responsible for the transportation area as a Development Manager. Dr. Bernd Lauterbach is an electrical engineer and has worked at SAP AG in Walldorf since 1995. From 2000-2007 he was the architect and project manager/development manager who headed up the development of SAP Event Management, the Auto-ID infrastructure and the new transport management solution SAP TM 6.0. Another focus of his work is in supporting many transport projects with SAP customers (logistics service providers and shippers). Since 2008, Bernd Lauterbach has worked as Senior Business Solution Architect in the IBU Travel & Logistics Services of SAP AG. Bernd Mosbrucker studied business administration, focusing on commercial information technology. In sales and marketing and in consulting he ran SCM projects in the automotive, chemical and paper industry as Senior Consultant. As an independent developer he implemented projects in the textile, tradeshow and logistics industry for small and medium-sized businesses. Since 2000, he first worked at SAP in Product Management for the concept development, then in Development as a project manager in the Transport area. In 2005, Bernd Mosbrucker took over responsibility for the transport solution in the Solution Management for SAP AG and drafted the basic idea for SAP TM. He is responsible for the solution strategy for fulfillment solutions in Supply Chain Management.

1 ... Introduction to Transportation Logistics ... 17 ... 1.1 ... Logistics Service Providers ... 19 ... ... 1.1.1 ... Third Party Logistics (3PL) ... 19 ... ... 1.1.2 ... Carriers ... 22 ... 1.2 ... Transportation Logistics in the Shipper and Manufacturing Industries ... 24 ... ... 1.2.1 ... Changing Roles in Logistics ... 25 ... ... 1.2.2 ... Factors Influencing Processes in the Consignment Industry ... 31 ... ... 1.2.3 ... Degree of Standardization for Each Mode of Transport ... 34 ... 1.3 ... Typical Transportation Processes ... 39 ... ... 1.3.1 ... Process ... 39 ... ... 1.3.2 ... Modes of Transport ... 44 ... ... 1.3.3 ... Freight Volume ... 48 ... 1.4 ... Legal Requirements and Documents in Transportation ... 49 ... ... 1.4.1 ... Regulations Governing Drivers ... 49 ... ... 1.4.2 ... The Operational Contract between the Ordering Party and the Contractor ... 55 2 ... Overview of SAP TM 6.0 ... 65 ... 2.1 ... History of Transportation Management Software at SAP ... 65 ... ... 2.1.1 ... Transportation Planning with the Transportation Planning and Vehicle Scheduling (TP/VS) Component ... 68 ... ... 2.1.2 ... Additional Components ... 68 ... 2.2 ... Initiative for the Development of the New SAP Transportation Management Solution ... 70 ... 2.3 ... Components of the New SAP Transportation Solution ... 72 ... ... 2.3.1 ... Master Data ... 72 ... ... 2.3.2 ... Order Management ... 72 ... ... 2.3.3 ... Planning and Optimization ... 73 ... ... 2.3.4 ... Subcontracting ... 74 ... ... 2.3.5 ... Transportation Charge ... 74 ... ... 2.3.6 ... Transportation Charge Settlement ... 75 ... ... 2.3.7 ... Analytics ... 75 ... ... 2.3.8 ... Supply Chain Event Management (SCEM ... 76 ... 2.4 ... Interaction of Components ... 77 ... ... 2.4.1 ... Integration of the SAP TM Lifecycle into Logistics and Supply Chain Management ... 77 ... ... 2.4.2 ... Business-Process-Oriented Core Elements of the Solution ... 80 ... ... 2.4.3 ... Integration into Existing Scenarios with the SAP Business Suite ... 82 ... ... 2.4.4 ... Transportation Scenarios a la carte SAP ERP and SAP TM ... 83 ... 2.5 ... New User Interface ... 88 ... ... 2.5.1 ... SAP NetWeaver Business Client (NWBC ... 89 ... ... 2.5.2 ... Screen Areas of the NetWeaver Business Client ... 91 ... 2.6 ... Possible System Landscapes with SAP TM ... 94 3 ... Organizational Structures and General Master Data ... 99 ... 3.1 ... Basic Settings ... 99 ... 3.2 ... Organizational Units of a Transportation Service Provider ... 99 ... 3.3 ... Product Master Data ... 104 ... ... 3.3.1 ... Precisely Defined Products in Third-Party Logistics ... 105 ... ... 3.3.2 ... Standardized Freight Codes and Material Groups ... 106 ... ... 3.3.3 ... Roughly Defined Product Categories ... 107 ... ... 3.3.4 ... Categories of Transport Equipment ... 108 ... ... 3.3.5 ... Service Products ... 108 ... 3.4 ... Business Partners ... 109 ... 3.5 ... Internal Business Partners in a Distributed Logistics Organization ... 112 ... 3.6 ... Transfer of Master Data between SAP ERP and SAP TM (Core Interface, CIF) ... 113 ... ... 3.6.1 ... Technical Preparation in SAP ERP ... 114 ... ... 3.6.2 ... Technical Preparation in SAP TM ... 115 ... ... 3.6.3 ... Application-Specific Preparation ... 116 ... ... 3.6.4 ... Integration Model and Selection Model ... 116 4 ... Logistical Master Data ... 119 ... 4.1 ... Transportation Network ... 119 ... ... 4.1.1 ... Locations ... 120 ... ... 4.1.2 ... Transportation Zones and Transportation Zone Hierarchy ... 124 ... ... 4.1.3 ... Transportation Lanes ... 127 ... ... 4.1.4 ... Transshipment Locations ... 134 ... ... 4.1.5 ... Schedules ... 137 ... 4.2 ... Resources ... 142 ... ... 4.2.1 ... Means of Transport and Vehicle Resources ... 143 ... ... 4.2.2 ... Transportation Unit Resources ... 145 ... ... 4.2.3 ... Drivers ... 145 ... ... 4.2.4 ... Calendar Resources and Handling Resources ... 146 ... ... 4.2.5 ... Maintaining Resources and Means of Transport ... 146 5 ... General Tools ... 157 ... 5.1 ... Conditions ... 158 ... 5.2 ... Post Processing Framework (PPF) ... 161 ... 5.3 ... Incompatibilities ... 170 6 ... Order Management ... 173 ... 6.1 ... Order Objects and the Order Receipt Process in SAP TM ... 173 ... ... 6.1.1 ... Order Receipt ... 176 ... ... 6.1.2 ... Data Areas in the Business Object Shipment Request ... 178 ... 6.2 ... Personal Object Work List in Order Management ... 180 ... ... 6.2.1 ... Personalization of the Personal Object Work List ... 182 ... ... 6.2.2 ... Defining Queries ... 184 ... 6.3 ... Business Object Structures in the Shipment and Freight Request ... 185 ... ... 6.3.1 ... Business Object Nodes of the Shipment Request ... 186 ... ... 6.3.2 ... Business Object Structure of the Freight Request ... 189 ... ... 6.3.3 ... Use of Role Codes and Type Codes ... 190 ... 6.4 ... Shipment Request Views ... 191 ... ... 6.4.1 ... Detail View of the Shipment Request ... 192 ... ... 6.4.2 ... Basic View of the Shipment Request ... 194 ... ... 6.4.3 ... Document Status ... 195 ... ... 6.4.4 ... Overview ... 197 ... ... 6.4.5 ... Detail Data for Overview ... 198 ... ... 6.4.6 ... Item Data ... 204 ... ... 6.4.7 ... Business Partners ... 211 ... ... 6.4.8 ... Packaging ... 212 ... ... 6.4.9 ... Resources (Transportation Units and Vehicles ... 213 ... ... 6.4.10 ... Shipment Stages ... 214 ... ... 6.4.11 ... Notes and Dossier ... 216 ... ... 6.4.12 ... Charges and methods of payment ... 218 ... ... 6.4.13 ... Governmental Procedures ... 220 ... 6.5 ... Associated Document Information ... 220 ... ... 6.5.1 ... Freight Units ... 220 ... ... 6.5.2 ... Execution Information ... 220 ... ... 6.5.3 ... Transportation Activities ... 220 ... ... 6.5.4 ... Customer Freight Invoice ... 221 ... ... 6.5.5 ... Tracking and Tracing ... 221 ... 6.6 ... Checking and Activating the Shipment Request ... 222 ... 6.7 ... Freight Units and Their Creation ... 223 ... 6.8 ... Transportation Proposal ... 228 ... 6.9 ... Transportation Revenue Determination ... 231 ... 6.10 ... Confirmation ... 233 ... 6.11 ... Printing Documents ... 234 ... 6.12 ... Communication (Email, Fax, Messages ... 235 ... 6.13 ... Customer Freight Invoice ... 236 ... 6.14 ... Freight Request ... 237 ... 6.15 ... Quotation ... 240 ... 6.16 ... Shipment Template ... 240 ... 6.17 ... Shipment ... 242 ... 6.18 ... Number Ranges and Tracking Numbers ... 245 ... 6.19 ... Customizing ... 246 ... ... 6.19.1 ... Role and Type Codes ... 246 ... ... 6.19.2 ... Shipment Request Type ... 246 ... ... 6.19.3 ... Print Documents Post Processing Framework ... 248 ... ... 6.19.4 ... Incoterms ... 249 ... ... 6.19.5 ... Text Types and Text Determination Procedures ... 249 ... 6.20 ... Further Functions in SAP TM 7.0 ... 250 ... ... 6.20.1 ... New Shipment Request User Interfaces ... 250 ... ... 6.20.2 ... Customer Fact Sheet ... 251 ... ... 6.20.3 ... Additional Functions in Order Management Area ... 251 7 ... Planning and Optimization ... 253 ... 7.1 ... Transportation Activities ... 254 ... 7.2 ... Planning Strategies ... 258 ... 7.3 ... Selection Settings ... 260 ... ... 7.3.1 ... Requirements Profile ... 262 ... ... 7.3.2 ... Time-Related Selection Attributes ... 262 ... ... 7.3.3 ... Geographical Selection Attributes ... 264 ... ... 7.3.4 ... Additional Selection Attributes ... 265 ... 7.4 ... Planning Settings ... 267 ... ... 7.4.1 ... Planning Profile ... 268 ... ... 7.4.2 ... Capacity Selection ... 269 ... ... 7.4.3 ... Pick-Up/Delivery Windows ... 271 ... ... 7.4.4 ... Planning Costs ... 273 ... ... 7.4.5 ... Optimizer Settings ... 277 ... ... 7.4.6 ... Settings for TSP Selection ... 279 ... ... 7.4.7 ... Time Constraints ... 283 ... ... 7.4.8 ... Settings for SFT Builder ... 284 ... 7.5 ... Planning ... 289 ... ... 7.5.1 ... Configuring the Planning Interface ... 291 ... ... 7.5.2 ... Planning Interface ... 295 ... ... 7.5.3 ... Manual Planning ... 298 ... ... 7.5.4 ... Load Planning ... 303 ... ... 7.5.5 ... Optimizer Planning ... 304 ... ... 7.5.6 ... Transportation Proposals ... 306 ... 7.6 ... Optimization Algorithm ... 309 8 ... Subcontracting ... 315 ... 8.1 ... Booking Order ... 317 ... 8.2 ... Shipment Order and Freight Order ... 321 ... 8.3 ... Transportation Allocations ... 331 ... 8.4 ... Transportation Service Provider Selection ... 338 ... ... 8.4.1 ... Manual and Automatic Transportation Service Provider Selection ... 338 ... ... 8.4.2 ... Incompatibilities and Continuous Moves ... 343 ... ... 8.4.3 ... Optimizer for Transportation Service Provider Selection ... 345 8.5 ... Tendering ... 348 9 ... Calculating Transportation Charges ... 357 ... 9.1 ... Calculating Transportation Charges within Subprocesses ... 358 ... ... 9.1.1 ... Order Receipt ... 359 ... ... 9.1.2 ... Subcontracting and Calculating Transportation Charges ... 401 ... ... 9.1.3 ... Transportation Charge Calculation for Planning and Automated Transportation Service Provider Selection ... 409 ... 9.2 ... All Master Data for the Calculation of Transportation Charges ... 411 ... ... 9.2.1 ... Overview and Interaction of Objects ... 411 ... ... 9.2.2 ... Freight Agreement ... 415 ... ... 9.2.3 ... Tariff ... 418 ... ... 9.2.4 ... Rule Maintenance ... 422 ... ... 9.2.5 ... Determination Logic for Freight Agreements and Tariffs ... 432 ... ... 9.2.6 ... Transportation Charge Calculation Sheet ... 437 ... ... 9.2.7 ... Transportation Charge Rate Tables and Scales ... 455 10 ... Invoicing Transportation Charges ... 467 ... 10.1 ... Creating and Processing Invoice Requests ... 468 ... ... 10.1.1 ... Transferring the Customer Freight Invoice Request ... 475 ... ... 10.1.2 ... Transferring the Supplier Freight Invoice Request ... 478 ... ... 10.1.3 ... Identifying the Recipient System ... 482 ... 10.2 ... SAP ERP Configuration ... 484 ... ... 10.2.1 ... Billing Documents ... 485 ... ... 10.2.2 ... Invoice Verification ... 488 ... ... 10.2.3 ... Customizing for SAP TM Assignment Tables ... 490 11 ... Analytics ... 495 ... 11.1 ... Reports and Dashboards ... 495 ... 11.2 ... Data Extraction from SAP TM ... 499 ... ... 11.2.1 ... Post Processing Framework (PPF) Settings ... 500 ... ... 11.2.2 ... SAP NetWeaver BW Structures ... 502 ... ... 11.2.3 ... Queries ... 502 12 ... SAP Event Management ... 505 ... 12.1 ... Overview and Functions ... 505 ... ... 12.1.1 ... Business Process Types ... 510 ... ... 12.1.2 ... Application Objects ... 511 ... ... 12.1.3 ... Event Types ... 514 ... ... 12.1.4 ... Application Log ... 515 ... 12.2 ... Event Handlers and Event Messages ... 516 ... 12.3 ... Event Handler Settings ... 520 ... ... 12.3.1 ... Basic Event Handler Settings ... 520 ... ... 12.3.2 ... Profiles for Expected Events ... 523 ... ... 12.3.3 ... Status Profiles ... 524 ... ... 12.3.4 ... Additional Event Handler Data ... 525 ... 12.4 ... Event Processing ... 525 ... ... 12.4.1 ... Technical Functions for Receiving Event Messages ... 526 ... ... 12.4.2 ... Establishing Rule Sets ... 527 ... 12.5 ... Information Output and Input Using SAP Event Management ... 530 ... ... 12.5.1 ... Event Handler List ... 530 ... ... 12.5.2 ... Data Input for Event Messages ... 533 ... ... 12.5.3 ... Event Confirmation ... 534 ... ... 12.5.4 ... Expected Events Overdue List ... 534 ... ... 12.5.5 ... Web Interface ... 535 13 ... Event Management Processes ... 539 ... 13.1 ... Order Status Tracking ... 540 ... 13.2 ... Shipment Tracking ... 542 ... 13.3 ... Vehicle and Transport Equipment Tracking ... 544 ... 13.4 ... Tour Status Tracking ... 546 ... 13.5 ... Tendering Tracking ... 547 ... 13.6 ... Enhancement of Tracking Processes ... 551 ... ... 13.6.1 ... Enhanced Business Process Types ... 552 ... ... 13.6.2 ... Additional Application Object Types ... 552 ... ... 13.6.3 ... Additional Extractors and Relevance Conditions ... 553 ... ... 13.6.4 ... Additional Event Handler Types ... 553 ... ... 13.6.5 ... Expansion of the Rules ... 554 ... ... 13.6.6 ... Enhancement of SAP Event Management Triggered Control Functions in SAP TM ... 554 14 ... Transportation Processes ... 555 ... 14.1 ... Handling of a Full Container in Sea Freight (FCL ... 556 ... ... 14.1.1 ... FCL Transportation Order ... 556 ... ... 14.1.2 ... Organizational Structure ... 557 ... ... 14.1.3 ... FCL Transportation Process ... 559 ... ... 14.1.4 ... Defining the Transportation Network ... 562 ... ... 14.1.5 ... Entering a Booking Order for Freight Space by the Sea Freight Dispatcher ... 566 ... ... 14.1.6 ... Receiving the Shipment Request by the Transportation Booking Agent ... 568 ... ... 14.1.7 ... Further Processing of the Shipment Request by the Transportation Booking Agent ... 572 ... ... 14.1.8 ... Planning the Sea Freight Stage ... 576 ... ... 14.1.9 ... Subcontracting of the Sea Freight Stage ... 577 ... ... 14.1.10 ... Generating the House Sea B/L (Shipment ... 578 ... ... 14.1.11 ... Planning, Tendering, and Subcontracting of the Pre-Carriage (Truck ... 580 ... ... 14.1.12 ... Planning and Subcontracting the On-Carriage (Truck ... 585 ... ... 14.1.13 ... Invoice Processing for the Service Provider Invoicing ... 585 ... ... 14.1.14 ... Profitability Calculation and Order Completion ... 586 ... 14.2 ... General Cargo Transportation (LTL) via Distribution Centers ... 587 ... ... 14.2.1 ... LTL Transportation Order ... 588 ... ... 14.2.2 ... Defining the Transportation Network ... 589 ... ... 14.2.3 ... Receiving the LTL Shipment Request by the Transportation Booking Agent ... 594 ... ... 14.2.4 ... Preplanning the LTL Shipment Request ... 596 ... ... 14.2.5 ... LTL Costing with Split Charges ... 598 ... ... 14.2.6 ... Shipment Tracking ... 601 ... 14.3 ... Template Booking for Sea Freight ... 601 ... ... 14.3.1 ... Product Data ... 602 ... ... 14.3.2 ... Personal Object Work List for Shipment Templates ... 603 ... ... 14.3.3 ... Creating a New Shipment Request ... 603 ... ... 14.3.4 ... Routing and Transportation Charge Determination ... 606 ... 14.4 ... Multimodal Routing of a Shipment ... 607 ... 14.5 ... Demurrage and Detention ... 610 15 ... Technological Foundations ... 613 ... 15.1 ... Business Object Modeling ... 613 ... 15.2 ... Enterprise Services in SAP TM ... 620 ... ... 15.2.1 ... Benefits of SOA ... 621 ... ... 15.2.2 ... Enterprise Services in SAP TM ... 625 ... ... 15.2.3 ... Information on Enterprise Services in the SAP Developer Network ... 632 ... 15.3 ... BAdIs in SAP TM ... 635 16 ... Conclusion ... 637 A ... Bibliography ... 639 B ... The Authors ... 641