SAP Supply Chain Management Elinor Castell Solution Owner Transportation, SAP SE

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1 SAP Supply Chain Management Elinor Castell Solution Owner Transportation, SAP SE 2014 SAP SE or an SAP affiliate company. All rights reserved. 1

2 SAP Extended Supply Chain Management Solution Strategy 2

3 Business Strategies Translating Business Realities to Business Strategies Personalized Solutions Customer Centricity Connect Products, Assets & Machines to Transform Supply Chain & Logistics into Product Networks Demand Networks Improve People s Lives Gain real-time network insight to action with Internet of Things 3

4 SAP Solution Strategy Connect your Company Strategy with your Customer & Product Strategy Improve People s Lives Internet of Things Design Personalized Solutions Customer Centricity Plan Product Networks Operate Demand Networks Monitor Respond Deliver Produce SAP HANA Platform 4

5 Demand Networks Transform Supply Chain & Logistics into Demand Networks Planning Matters Aggregated 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 chain Business Concept: Business Networks Fulfill to Please About 10%* of world-wide GDP is related to Logistics spending Business Concept: Connected Logistics PLAN RESPOND DELIVER *Source: Several SAP Benchmarking Reports and Industry Analyst Reports 5

6 Demand Networks Customer Centricity Demand Networks Plan/Respond/Deliver public cloud managed cloud Real-time Network Insights Plan Respond Deliver SAP Business Suite 4 HANA SAP HANA Platform on-premise Plan Sales, Inventory and Operations Planning Demand Management Demand Network Respond Response and Supply Management Production Planning and Scheduling Response Network Deliver Warehouse Management Transportation Management Logistics Network 6

7 SAP Logistics and Order Fulfillment Solution Strategy 7

8 The role of logistics is changing Global business drivers impacting logistics Increasing market volatility Complexity Major shifts in customer demand volume, increasing regulations, new competitors Escalating customer expectations Delivery Performance Customer is demanding high-quality, flexible delivery becoming the #1 logistics objective Declining logistics performance Impact of disruptive events and technology changes while cost budgets stay the same 8

9 Major challenges for logistics and distribution Cost pressure Logistics cost average 10% of revenue and are still increasing, bearing optimization potential Transparency remains vague Logisticians require process control along with real-world based insights for rapid and effective decision making Isolated operations at logistics partners Manufacturers, freight forwarders, carriers and retailers operate independently 9

10 Strategies for logistics and order fulfillment Logistics 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 10

11 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)

12 Warehouse Management Optimize warehouse and distribution operations by combining optimization techniques with the end-to-end logistics process across a warehouse 48% Lower customer order cycle time 6% More orders shipped on time Where picking, packing, and shipping are automated 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. 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. Where warehouse process is optimized based on shipping times 12

13 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 13

14 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 14

15 Transportation Management Enable companies to better meet transportation demands with streamlined processes, decreased costs, improved compliance and flexibility Transportation Requirements Management Centralize transportation requirements management, from entry to final settlement. Freight Planning and Optimization Optimize and balance freight costs and constraints. Freight Tendering 22% Lower spend When transportation is integrated with SAP ERP and partners 13% Less invoice errors With automatically calculated and distributed costs Create an automated environment for freight tendering. Carrier Booking. Automate a collaborative environment for carrier booking. Transportation Execution and Monitoring Execute and monitor transportation and planning Freight and Forwarding Settlement Manage and settle freight agreements for carriers and customers. 15

16 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 16

17 Cargill improving visibility with SAP Transportation Management 17

18 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

19 Logistics Network Deliver the best-possible carrier services with improved freight contracting, holistic partner collaboration and transparency. 9% Less transportation spend Where forecasts are dynamic and updated frequently 20% Fewer unplanned costs Sense and respond to logistics insights Provide 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. Strategic Freight Management Forecast and assess future transportation requirements. Request bids from carriers to address transportation needs, and negotiate contracts and agreements with carriers. Through visibility into in-transit and network-wide inventory 19

20 Efficient Logistics and Order Fulfillment Balance customer service and delivery costs for greater speed, efficiency, and sustainability Efficient Logistics & Order Fulfillment Warehouse Management Warehouse Management Manage advanced distribution centers and production warehouses with optimization capabilities. Transportation Management Run multimode, domestic, or international transportation processes in one holistic solution Transportation Management Logistics Network Logistics Network SAP HANA Platform Enable cross-company coordination of logistics with strategic freight management and collaboration. 21

21 Integrating and connecting logistics Logistics platform Mobile Enabled Experience Warehouse Management Transportation Management SAP HANA Platform Optimization Business suite integration Logistics seamlessly integrated to financials, order-to-cash and procureto-pay Track & Trace Real-time insights and control Warehouse Management, Transportation Management and Track and Trace converged on one platform Logistics network Connected Orchestration of collaboration between logistics partners, and track and trace in the internet of things 22

22 SAP Supply Chain Solution Portfolio Knowledge Gap Supply Chain Planning (SCP) Distribution Center Manufacturing Shipper Speed Agility Retail Store Efficiency Visibility Order Customer Delivery Freight Forwarder Carriers Customs Supply Chain Execution (SCE) Explore Prepare Doing the right things Implement Operate Doing the things right Cost Risk

23 Thank you!

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