Universit degli Studi di Roma La Sapienza Dipartimento Idraulica Trasporti e Strade
SAP Logistics Execution
Ing. Andrea Campagna
Corso di Sistemi Informativi Aziendali Prof. Umberto Nanni
Contents
The ERP systems Overview of SAP The SAP Logistics Execution System
Enterprise Resource Planning
Commercial software packages that promise the seamless integration of all the information flowing through the company financial, accounting, human resources, supply chain and customer satisfaction (T. J. Davenport, 1988) ERP systems provide information management and analysis to organizations
Benefits of ERPs
on-line/real time information throughout all the functional areas of an organization data standardization and accuracy across the enterprise "best-practices" included in the applications the efficiency they force an organization to undertake the analysis and reporting that can be used for long term planning
ERPs impact on industry
Lower total costs in complete supply chain Shorten throughput times Reduce stock to a minimum Enlarge product assortment Improve overall product quality Increase reliability of delivery dates Improve customer service Coordinate demand, supply and production
ERP market share 2002
SAP AG 25,1% Oracle 7,0% Others 51,1%
Microsoft 4,9%
SAGE 5,4%
PeopleSoft 6,5%
Source: Gartner Dataquest (June 2003)
An example of ERP: SAP
mySAP PLM
mySAP ERP (R/3)
mySAP SRM
Financials Human Resources Logistics Corporate Services Operations
mySAP CRM
mySAP SCM SAP NetWeaver
SAP R/3 architecture
Software oriented view SAP GUI Frontend Hardware oriented view
router Application processes scalability
Database
DB
SAP R/3 functionalities
Financials (AC)
Financial Accountin (FI) Controlling (CO)
Human Resources (HR) Logistics (LO)
Sales and Distribution (SD) Materials Management (MM) Logistics Execution (LE)
Screenshot SAP R/3
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Logistics Execution System
LE component maps a companys logistics processes, covering the entire process chain
Vendor, internal warehouse, production site, and distribution centre right through to the customers
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LE processes include:
Inbound process Outbound process Internal warehouse Transportation process
SAP LES integrated part of the Supply Chain
PLANNING AND OPTIMIZATION Supply Network Planning Planning and Simulation Forecasting
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Transportation
SAP LES
Warehouse Management
Purchasing
Production BUSINESS PROCESSES
Sales
Logistics Process
1. Sales order processing for goods issues
Handled mainly by Sales and Distribution (SD)
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2. Ordering (purchase order processing) for goods receipts
Handled mainly by Materials Management (MM)
3. Physically moving goods in the supply chain SAP LES is the link between 1 and 2
Logistics overview
Sales order MRP External procurement Production Internal procurement Production Presales activity
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Invoice verification
Inventory Management
Goods receipt Posting change Goods issue
Invoice receipt
Internal and external accounting
shipping
billing
Goods Receipt: procurement
Determination of requirements Determination of Source of supply Selection of vendor
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Handling of payments
Ordering
Invoice verification
Goods receipt
Purchase order monitoring
Purchase orders
Purchasing
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Purchase requisition
Purchase order
External vendor
Request For quotation (inquiry)
Other plant Master data
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Goods receipt for purchase order
External vendor Or other plant Delivery of Materials ordered
Purchase order
Material document
Goods receipt posting
Accounting documents
Purchasing / inventory management
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Goods issue: sales order processing
Presales activities
Order processing
Procurement
Payment
Billing
Shipping/ Transportation/ Goods issue
Goods issue for sales order
Sold-to party
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Sales order
Outbound delivery Transfer order (pick order)
Ship-to party
Shipment
Bill-to party
Billing document Accounting documents
Goods issue
Payer
Sales and Distribution (SD)
Material document
The Shipping Process
Sales order Functions affecting shipping
-Determination of shipping point -Determination of route -Scheduling
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Shipping point
-Monitoring of shipping due to dates -Create delivery
Warehouse
Goods issue Shipping documents Packing Picking
Warehouse Management
Storage bin management Planning and monitoring
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Stock movements
Radio frequency (RF) connection
Warehouse control
Organizational Units and Master Data
Business Scenario
Master data and organizational units are required for mapping the IDES model company in the SAP System. Since you are the project team member responsible for this, you assign the necessary organizational units, and edit the appropriate master data.
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Organizational Units
Company Code Plant Storage Location Warehouse Number Transportation Planning Point Shipping Point
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The Company Code
Legally independent unit with a self-contained set of accounts The following are created at the company code level:
Financial statements Profit and loss statements
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The Plant
A plant is an organizational unit in Logistics, and allows you to look at a company from the point of view of production, procurement, plant maintenance, and materials planning. A plant is a branch or division within a company.
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The Storage Location
An organizational unit that enables you to distinguish between the various material stocks in a plant. Quantity-based inventory management data pertaining to the plant is summarized at the storage location level.
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The Warehouse Number
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An organizational unit that maps the company from a warehouse management perspective. A warehouse number corresponds to a warehouse complex containing different storage types that are organized differently. The physical conditions of the warehouse are mapped in the warehouse number.
Organizational Units in a Warehouse Number
Door 1 Door 2 Storage type 902
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Goods Receiving Zone
Fixed bin storage Picking area 1 Picking area 2
Storage type 005
Shipping Area Staging Area 1 Staging Area 2
Storage type 916
Door 3 Door 4 Door 5
Bulk Storage
Storage type 004
Pallet storage Storage section 1 Storage section 2
Storage type 007
Warehouse Number 140
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The Transportation Planning Point
Transportation Planning points
Planning, handling, And settlement of shipments
Hamburg International Ocean freight
1010
Hamburg Rail Transportation
1011
Dresden Truck Transportation
1200
The Shipping Point
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A shipping point is an organizational unit that allows you to look at a company from the point of view of shipping, the shipping materials required, and the means of transportation required. On the goods receipt side of things, the goods receiving point corresponds to the shipping point.
Organizational structure
Company
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Transportation Planning points
Plant 1
Plant 2
Plant n
Shipping points
Storage Location 1
Storage Location 2
Storage Location n
Warehouse number
Storage bins and quants
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In Warehouse Management, the individual storage bins are defined within each storage type. A storage bin is the smallest geographical or organizational unit that can be addressed by the system. They can be mapped as coordinates: 02-04-09 aisle 02, stack 04, level 09 Bin type P1 for upper bins, P2 for lower bins The existence of a material (a value) in a bin is referred to as a quant.
Storage bins and quants
Quants are defined by:
Material (Batch) Stock category Special stock Plant / storage location (storage unit number)
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Information contained in a quant
Material Stock category Plant/Storage location Special stock Batch Storage unit Available Stock Putaway/ Pick? Weight Goods receipt data Goods receipt number Last movement
Material Master
General Data Plant-specific Data Warehouse Management Data Purchasing Data Sales and Distribution Data Accounting Data
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Views in a Material Master Record
Basic Data MRP Stock in plant Storage loc. Accounting Storage Warehouse Management Purchasing SD Work scheduling Quality Management Forecast Classification
Material Master
Customer Master
General Data Relevant to SD and accounting Relevant to accounting Valid for all organizational units Valid for Company Code
Valid for: sales organization / distribution channel / division
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Company Code Data Sales Area Data
Relevant to SD
Vendor Master
General Data
Relevant purchasing and accounting
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Valid for all organizational units Valid for Company Code
Valid for: purchasing organization
Company Code Data Purchasing organization data
Relevant to accounting
Relevant to purchasing
Universit degli Studi di Roma La Sapienza Dipartimento Idraulica Trasporti e Strade
SAP IDES
Ing. Andrea Campagna
Corso di Sistemi Informativi Aziendali Prof. Umberto Nanni
Contents
The IDES Exercise
Inbound deliveries and putaway in a WM Warehouse
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The IDES
The "Internet Demonstration and Evaluation System" in the R/3 System, represents a model company. It consists of an international group with subsidiaries in several countries. IDES contains application data for various business scenarios that can be run in the SAP System. The focal point of IDES is the business processes and their integration.
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Business areas
Human Resources Financial Accounting Product Cost Planning Overhead Management Profitability Analysis Planning Sales and Distribution Materials Management Production
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The structure of the IDES group
IDES
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North America Latin America
Company 1 Company 2 Company 1
Europe
Company 1 Company 2 Company 3 Company 4 Company 5
Asia
Company 1
Each company
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has its own clearly defined business objectives within the consolidated group and is organized according to local business practices and legal requirements. Consolidation takes place across the financial areas. Accounting and Human Resources for each individual company have been adapted to meet the particular business objectives.
For example
The French subsidiary operates solely as a sales company. In Mexico, we represent high-inflation methods and the material ledger. The American and German subsidiaries produce goods, as well as carrying out purchasing and sales activities. Germany and the United States have been set up to use flexible standard costing. The United Kingdom uses static standard costing based on full costs.
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IDES Logistics
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A variety of products are manufactured and sold using the different organizational units within the Logistics area. IDES provides all the resources required for production and assigns them to the corresponding products through bills of materials (BOMs) and routings. Each product or product group represents a particular production type. IDES contains fully-integrated business processes for the production or sale.
Products
Product Elevators Motorcycles Cars Pumps Personal computer Lighting products Paints / solvents Tablets Food / cosmetics Process Type
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Engineer-to-order Make-to-order production Sales-order-based repetitive manufacturing Make-to-order production Repetitive manufacturing Mass production Process industry, Chemicals Process industry, Pharmaceuticals Retail
Exercise
Inbound deliveries and putaway in a Warehouse Management warehouse
The problem
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The IDES Purchasing department orders goods for plant 1000 (Hamburg). The purchase order is to be confirmed by the vendor using a shipping notification. When the shipping notification is received, the data is transferred to an inbound delivery document within the Logistics Execution System. The putaway takes place in the central warehouse of plant 1000. Goods movements and inventory management in this central warehouse are supported by the Warehouse Management system (WM).
The process scenario
External vendor Or other plant Delivery of Materials ordered
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Purchase order
Material document
Goods receipt posting
Accounting documents
Purchasing / Inventory management
The process flow (1)
1. Creating a Purchase Order
As an IDES purchasing employee, you place an order for goods for plant 1000 (Hamburg).
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2. Creating the Inbound Delivery
The vendor confirms the delivery date in the shipping notification. In this case, however, it is a partial delivery. You enter this in an inbound delivery document.
The process flow (2)
3. Executing the Putaway
When the ordered goods arrive, they are put into stock in the central warehouse. You use the delivery monitor to start and oversee the various putaway steps.
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4. Resetting the Starting Situation
To avoid exceeding the storage capacity in the warehouse by repeating this demo several times, you now start a CATT that clears the stocks you have just placed into storage.
