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SAP Logistics

SAP Logistics

In this specialist article, you will learn how integrated supply chain logistics management solutions by SAP generate a consistent digitization and optimization of all logistics processes. This ensures more efficiency, cost reduction and a sustainable and networked supply chain.

Beatrix Niklaus

Product Manager at FIS

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What is SAP Logistics?

SAP Logistics is not a single product but describes a comprehensive portfolio of software solutions for all areas of corporate logistics, which includes modules for procurement, stockholding, transportation management, production, distribution and more.

In contrast to isolated solutions, these logistics modules are seamlessly interlocked with each other so that business processes can be consistently mapped – from goods receipt of materials to outbound delivery to customers. Due to this tight integration, data remains up-to-date and consistent across all logistics areas, which enables an efficient supply chain and a continuous process optimization.

These modules enable enterprises to control their entire logistics processes with SAP. In this way, all goods movements and services are efficiently scheduled, controlled and monitored. Advanced SAP logistics solutions support mobile applications as well as automated state-of-the-art storage and picking – which eliminates media changes and accelerates data entry.

How does SAP Logistics optimize supply chain management?

The use of SAP Logistics leads to an efficient end-to-end optimization that is flexible, transparent and cost-efficient – a key factor to optimally control the supply chain in a global competitive environment.

The individual modules interlock like gearwheels – across departmental boundaries. Processes that used to be isolated in the past – such as purchasing, storage, transportation as well as sales and distribution – merge now. This creates transparency along the entire value chain, from raw materials to end customers. Problems such as material bottlenecks, delivery delays or overstocks can be recognized at an early stage and proactively removed.

In this way, production, stockholding, transportation and order processing, for instance, can be digitally linked and synchronized in real time, which ensures high inventory accuracy and short delivery times. SAP Transportation Management can be used to plan more efficient routes and reduce costs. At the same time, SAP Track and Trace permits the real-time tracking of consignments and an end-to-end supply chain monitoring. In case of deviations – e.g. delays or malfunctions – automatic notifications will provide information, for instance, via e-mail or Fiori App Push Notifications for persons responsible, who can quickly take countermeasures thanks to real-time data. Advanced technologies such as AI and machine learning will help improve forecasts and, for instance, automate transportation planning or warehouse materials planning.

Sustainability, risk management and supply chain resilience also benefit from these technologies because emissions are reduced by optimized routes and utilizations. Furthermore, SAP supports the compliance with rules (keyword: supply chain due diligence) and provides analysis options to evaluate the carbon footprints of transports for instance.

SAP Logistics with FIS

SAP Warehouse Management & Transport Logistics

Future-proof Logistic Solutions

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Which modules does SAP Logistics include?

SAP divides logistics into different end-to-end processes. Together, they form a holistic logistics management system in the SAP S/4HANA or SAP ERP environment.

Overview of the most important SAP Logistics modules:

Purchasing and procurement – former SAP MM (Materials Management)

This logistics module SAP MM supports the procurement and inventory management of materials. It includes, for instance, requirements planning, purchase order processing, goods receipts and goods issues as well as invoice verification. The module for purchasing and procurement ensures that sufficient material is always available and no shortages arise in the warehouse. As a consequence, it transparently maps procurement processes and is closely interlocked with warehouse management and quality assurance.

Sales and distribution & shipping – former SAP SD (Sales and Distribution)

SAP SD covers all sales and distribution and shipping processes – from quotation, sales order and outbound delivery to invoicing. It controls order processing as well as functions like price determination, billing and credit management. As a core module, Sales and Distribution ensures that products are efficiently sent to customers and the entire sales process is mapped within the system.

SAP WM (Warehouse Management / Lagerverwaltung)

SAP WM is the classic Warehouse Management system under SAP ECC. It manages complex warehouses and controls putaway, stock transfer, picking und stock removal of goods. Core functions are, for instance, inventory management at storage bin level, physical inventories and different putaway and stock removal strategies (e.g. FIFO/LIFO). SAP WM enables a detailed control of warehouse stocks and goods movements to avoid shortfall quantities during picking for instance.

Under SAP ECC, SAP WM will only be supported until 2027.

In SAP S/4HANA, it is only available until 2025 and replaced by alternative solutions. For the moment, existing customers can switch to Stock Room Management; in the long run, however, a transition to EWM is recommended.

SAP Extended Warehouse Management (SAP EWM)

SAP Extended Warehouse Management (SAP EWM) is a scalable and high-performance Warehouse Management system that flexibly supports all logistics processes concerning warehouse control – from goods receipt and stockholding to picking and shipping. SAP EWM can be used to optimize warehouse processes – for instance by integrating conveyor systems and automated systems. EWM supports mobile devices such as scanners and tablets out of the box, which makes processes like automated warehouse and automated warehouse logistics more efficient. As SAP EWM is a strategic Warehouse Management system, it is constantly further developed – also beyond 2025 – in contrast to SAP WM, which is to be discontinued. With SAP EWM, customers obtain a future-proof solution for warehouse logistics.

SAP EWM also includes SAP Material Flow System (MFS) for directly connecting automatic warehouse systems (conveyor belts, stacker cranes etc.) to enable an automated warehouse without external warehouse control software – interfaces and costs are reduced.

SAP Transportation Management (SAP TM)

SAP TM is a transportation management software for planning, controlling, processing and settlement of all transport processes. It can be used for managing transfer orders, planning routes, consolidating freights and centrally controlling transportation planning. SAP TM selects the optimal transportation plan based on costs, route, service provider and shipment type. Due to strategic freight purchasing and bundling of shipments, SAP TM helps reduce transportation costs and ensure punctual deliveries. Furthermore, the module provides functions for freight settlement (incl. credit memo procedure) and tracking of shipments (transport control by means of Track & Trace).

Warehouse & logistics – SAP LES / LES (Logistics Execution System)

In SAP ERP, SAP LE describes the logistics execution module that deals with shipping (delivery process) and warehouse management. In principle, LES combines the functions of SAP Warehouse Management and transportation/shipping processing in one module. LES supports manual as well as automatic warehouses and covers the complete flow of goods – from goods receipt and picking to goods issue. In SAP S/4HANA, however, the LES tasks were distributed to specialized solutions: primarily SAP EWM for warehouse management and SAP TM for transportation management as these solutions provide more functionalities and optimizations in their areas.

Production logistics – former SAP PP (Production Planning)

SAP PP includes all tools for production planning and control. Enterprises can use it to schedule production processes in a timely manner and according to capacities, manage bills of material and work plans and carry out material requirements planning (MRP). The module enables the assurance of production supply, the prevention of bottlenecks and the efficient implementation of production orders in the production department. In SAP S/4HANA Logistics, extended PP functions for detailed planning and for planning bottleneck materials are provided – functions that used to be available in separate APO systems in the past. Furthermore, the PP module can be integrated with MES systems (Manufacturing Execution System) to transfer confirmations from production to the ERP system in real time.

Quality management – former SAP QM (Quality Management)

The SAP QM module integrates quality inspections and quality assurance measures into the supply chain. From goods receipt and production to goods issue, quality inspection plans can be created and tests carried out. QM supports samples, the blocking and release of batches, complaint processing and audit management. By means of QM, enterprises ensure consistent quality standards in all logistics processes and fulfill compliance requirements.

SAP LO (Logistics General) provides essential cross-module functionalities and master data to reduce data management in the individual modules. The functions of this module include, for instance, batch management, variant configuration and document management, which are also used by several modules.

SAP aATP (advanced Available-to-Promise) is used for answering inquiries concerning order fulfillment based on availability checks in real time. The business function is an SAP S/4HANA component. Based on the current warehouse stocks, planned receipts as well as already existing orders, SAP aATP provides reliable date proposals and accelerates responsiveness, which improves the informative value towards customers. This module ensures full transparency, prevents bottlenecks, reduces delays and increases customer satisfaction.

What benefits are achieved by SAP and FIS logistics solutions?

FIS uses SAP Activate as a standard methodology for SAP implementation projects in SAP S/4HANA Cloud Public Edition. The decision in favor of this is based on several advantages: FIS uses SAP Activate as a standard methodology for SAP implementation projects in SAP S/4HANA Cloud Public Edition. The decision in favor of this is based on several advantages:

  • Fast software implementation:
    Immediately applicable enhancements and preconfigured templates will accelerate your implementation projects and save costs.
  • Tailored to your requirements: 
    Field-tested FIS developments for warehouse management and transportation management optimize the SAP standard version and enable comfortable working with the software for you.
  • Efficient processes through optimal supply chain integration: 
    FIS ensures a smooth data and material flow for you by seamless integration of ERP and Warehouse Management systems, upstream and downstream processes as well as business partners (e.g. express delivery service providers).
  • Intuitive operability of logistics software and hardware: 
    The transparent system logic of the SAP software and user-friendly FIS dialogs (e.g. for mobile data entry via bar code scanners or pick-by-voice systems) enable fast familiarization and use for your employees.
  • Reliable implementation and support from a single provider: 
    As an industry-independent one-stop provider, FIS offers a reliable all-around service, from hardware recommendation and software implementation to cross-departmental process consulting and subsequent system operation and support.
  • Tested and certified quality: 
    As an SAP partner with “Gold” status, FIS always ensures a high quality of work results, e.g. by SAP-certified consultants, developers and support employees or system validation for SAP EWM and TM by Fraunhofer Institute for Material Flow and Logistics (IML).
  • Future-proof logistics processes: 
    Our logistics experts will support you with their know-how when it comes to optimizing your warehouse logistics. FIS covers the essential parts of the SAP Supply Chain Execution portfolio – from warehouse to transportation management and the connection of upstream and downstream processes.

Are there any optimizations enhancing the SAP standard version?

Optimizations developed by FIS provide enhancements to the SAP standard version to make your logistics ergonomic and efficient:

The mobile FIS/LastMile Cloud app documents the goods delivery and provides support for the last mile in the form of convenient functions.

As an optional enhancement, the Tracking Monitor provides live map data on current vehicle locations and routes.

FIS/TimeSlot enables the coordination of inbound deliveries by posting available time slots and by means of a precise workforce planning in the warehouse.

FIS/Freestyle Picking accelerates the over-the-counter sales in the pickup store and warehouse by means of independent customer picking.

The FIS/Real-Time Monitor provides an overview and full transparency of relevant SAP EWM key figures to be able to react quickly to deviations and anomalies.

FIS/UI5-Creator converts ITSmobile applications such as radio dialogs in the warehouse into a convenient UI5 design and facilitates the work of warehouse employees by means of mobile terminals.

FIS/Lagerplatzverkettung (Lagerplatzverkettung = storage bin concatenation) facilitates the putaway of large and bulky parts requiring more than one storage bin, prevents double bin occupancy and supports users in physical inventory.

Furthermore, FIS provides accelerated template implementations for SAP EWM and SAP TM. The FIS/ewm+ and FIS/tm+ template solutions specially provided for implementation contain documented processes as well as preconfigured Customizing. The templates have been configured as consistent end-to-end processes – seamlessly integrated in SAP ERP as well as in adjacent logistics areas, which enables a particularly convenient and quick implementation.

How can WMS, ERP, MFS & storage techniques be connected and integrated?

Diagram showing the integration of MFS with warehouse technology in various ERP and WMS system landscapes. In the center is a dark blue circle labeled “MFS with warehouse technology.” Arranged around it are several light blue circles with arrow connections to MFS: “SAP EWM,” “External WMS” (multiple), and “if available: External WMS.” Above this are larger gray and beige circles representing SAP systems: “SAP ERP (ECC or S/4HANA) – SAP EWM,” “SAP S/4HANA – SAP Stock Room Management/SAP WM (until 2025),” “SAP ERP (ECC or S/4HANA)” and “Non-SAP ERP.” A small circle labeled “FIS/xee” connects Non-SAP ERP with SAP EWM. The diagram shows various possible integration paths between ERP systems, warehouse management systems (WMS), and MFS warehouse technology.
SAP connection of Warehouse Management systems and material flow control

Due to its longstanding experience in the areas of SAP ERP and logistics, FIS and its expert team can support you in the connection and integration of all logistics softwares and hardwares.

Even the SAP standard version provides different architectures for interfaces between ERP and Warehouse Management systems (WMS). If these architectures are not sufficient, the Warehouse Management system can be addressed, for instance, via individual interfaces and by means of the FIS competence in the area of SAP Business Process Integration.

To connect an external Warehouse Management system (WMS), the interface technology in SAP EWM can be used if, for instance, SAP intralogistics solutions like SAP EWM for manual warehouses are applied. If an enterprise processes intralogistics completely via the WMS of a different manufacturer, the SAP delivery interface can be used for the connection to the ERP system.

By means of the interface to material flow control (MFC) integrated in SAP EWM, different storage technique applications (e.g. for automatic small parts storage areas, shuttles, warehouse control units, stacker control systems, storage lifts, carousels) can be directly and completely controlled via SAP EWM in addition. Even enhanced pick-by techniques (e.g. pick-by-light, pick-by-voice, pick-by-vision), can also be connected with minimum effort. Enterprises using SAP S/4HANA with the integrated WM-LSR interface are provided with comprehensive advice by FIS with regard to alternatives after the end of the compatibility mode on December 31, 2025.

What does the future of logistics look like under SAP S/4HANA?

With SAP S/4HANA, SAP modernized its ERP platform and converted it into an in-memory database in 2015. For logistics, this meant real-time processing of large datasets and simplified data models. Many components that used to be separately installed in the past, have been integrated more tightly in S/4HANA or are available in updated form, e.g. SAP EWM has been directly integrated in S/4HANA as embedded EWM, just like SAP TM, which improves integration and throughput. Logistics management in S/4 benefits from faster evaluations, e.g. immediate stock overviews and simulations in transportation planning with current data.

SAP S/4HANA also facilitates digitization in logistics: For this purpose, SAP Fiori apps are available. This role-based and easily operable apps enable, for instance, warehouse workers to carry out picking or putaway orders in mobile form on scanner devices or tablets. MRP controllers can detect bottlenecks via clear Fiori dashboards, analyze causes and initiate counteractive measures. Advanced UI/UX increases acceptance among users and noticeably improves productivity.

Automation in the warehouse: By means of SAP EWM and by integrating material flow systems (MFS), automatic Warehouse Management systems and robots can be directly controlled – for automated warehouses without media changes.

With SAP Business Technology Platform (BTP), SAP furthermore provides a central technology foundation to raise logistics processes to the next level. BTP combines data and analytics solutions, integration services, app development, IoT connections and AI functions in one environment. For logistics customers, this means: Individual enhancements, e.g. specialized logistics apps or additional functions, can be developed on a cloud basis and seamlessly connected to the SAP system without modifying the core of the SAP system (Clean Core Approach). Examples are IoT sensors in warehouses or trucks that are connected via SAP BTP and, for instance, send temperature, location or filling levels to SAP in real time, which results in a logistics execution system with highest transparency. Even robotics and automation in warehouses (e.g. with autonomous FTS or robots) can be integrated in SAP EWM via standardized interfaces. These innovations – real-time data, cloud integration, mobile Fiori apps, IoT and AI – promote the logistics transformation.

Enterprises in Germany and worldwide relying on advanced and high-performance solutions can use these innovations to make their logistics processes fit for the future: Cost reduction by means of automated processes, higher speed due to digital workflows and improved decision bases through analytics are direct benefits. At the same time, the system remains flexible for future requirements.

Conclusion

SAP Logistics covers all areas and issues of enterprise logistics – from procurement, warehouse logistics and production to distribution. With this comprehensive product range of SAP Logistics solutions, enterprises obtain an integrated platform to efficiently control their supply chains and holistically optimize them. The different SAP Logistics modules enable transparency across all processes and a complete tracking of goods movements in real time, whereby bottlenecks and delays can quickly be identified and removed.

As a whole, SAP solutions and FIS logistics solutions result in more efficient processes, improved utilization of resources and lower costs – and, in this way, provide enterprises with a decisive competitive advantage. Due to high integration and flexibility, decision-makers can dynamically adjust their logistics strategy and continuously improve it. In short: SAP Logistics can be used to implement intelligent digital business processes that provide end-to-end mapping of supply chains, ensure an efficient supply chain and make enterprises fit for the future.