2 Tier Scenario for Inbound Transportation

Procurement at headquarters ensures that the headquarter maintains the overall control on the organizations procurement process. Subsidiaries however, at times need a more flexible solution to cater to their specific requirements. A key aspect of this subsidiary procurement process is management of the transportation of these goods from the vendor to the destination. SAP S/4HANA Cloud ensures the coverage of this requirement.

The embedded Transportation Management Solution within SAP S/4HANA Cloud caters to the end-to-end transportation process coverage including Transportation Order Management, Transportation Execution, Charge Calculation and Settlement. In addition, there are scenarios where subsidiaries also need a detailed transportation planning to ensure optimal utilization of the resources, keeping in mind the various constraints. Typically, an On-Premise SAP Transportation Management solution is capable to cater to this requirement. Fulfillment of this scenario ensures the flexibility needed by the subsidiaries to procure as per their differentiated need, thereby adding to the robustness of the overall solution.

Thus a 2 Tier transportation solution where the SAP S/4HANA Cloud caters to the overall transportation process and an On-Premise SAP Transportation Management solution providing the required support towards catering to the detailed transportation planning requirements is needed. Mentioned below is a simplified workflow for Inbound Transportation business scenario using external SAP Transportation Management Integration.

2%20Tier%20-%20Inbound%20Transportation%20-%20Simplified%20Process%20Flow

2 Tier – Inbound Transportation – Simplified Process Flow

For the above scenario, the scope item 5VV (Order-Based Transportation Consolidation – Inbound) covers the End-to-End process from Transportation request to settlement.

A more detailed process is mentioned below.

2 Tier – Inbound Transportation – Process Flow

As you can see in the process flow, the purchase order and the Freight units are created in the SAP S/4HANA Cloud Transportation Management system. The Freight units are then replicated into the external Transportation Management system for Transportation Planning. The result of this Transportation Planning (Freight Order) is then sent back to the SAP S/4HANA Cloud for further processing. It is here that processes like Transportation Charge Calculation, Transportation Execution and Freight Settlement takes place.

Benefits of using Decentralized Transportation Planning in a Two tier scenario:

  • Supports transportation processes within SAP S/4HANACloud with Inbound order-based transportation consolidation together with an external SAP Transportation Management system thereby providing adequate flexibility to Subsidiaries to procure as per their specific needs.
  • Enhanced capability to plan the Freight units
  • Reduce freight costs with early Transportation Planning capabilities

For more information kindly refer to the scope item 5VV (Order-Based Transportation Consolidation – Inbound) within the SAP Best Practices for SAP S/4HANA Cloud here

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