• Kevin

More detail on SAP EM and TM

In the first part of my blog on SAP EM and TM I talk about how EM bolsters the functionality of TM. In this blog we take a look at that a little deeper.


SAP has made an effort to integrate SAP EM into their SAP TM module. In each release since SAP EM 7.01, the developers have strengthened the integration between it and SAP TM. This integration provides monitoring functionality between the sales order, transportation plan and execution processes. SAP EM leverages the planned dates, locations and resources, as laid out by the SAP TM optimizer, to check if the schedule is being followed as outlined. If the actual schedule is not following the proposed schedule, i.e., an exception has occurred, corrective action can be taken. Statuses, both in SAP TM and SAP EM, are updated to provide visibility to other parties interested in the process.


SAP EM also provides a method of real-time communication to customers, partners and employees. At times, shippers will have no knowledge into the transportation activities of their carriers. This lack of visibility means that once goods are loaded onto the trucks and depart the docks, shippers have no visibility into the geographical location of their goods until they arrive at the destination location. By tracking a shipment with SAP EM, a shipper has the ability to report a delay in a shipment, which can be used to trigger a notification to the receiving customer of the postponed arrival of the goods.


Carriers perform the actual transportation activities, but shippers need to have the same information available in real time as carriers have available about their equipment, their operators and their movements. In a B2B or B2C scenario, the assumption is that the shipment will be delivered on time to its destination without interruption. However, when an unforeseen event occurs, or what is referred to as an exception in SAP EM, this information needs to be communicated to all parties as quickly and as efficiently as possible. Reporting exceptions in a timely manner is becoming a standard obligation in most shipper's contracts with their carriers.


Shippers can request their carriers to report transport related events to both SAP TM and SAP EM. The reporting could be done via EDI, which is an automated file transfer process, or by providing the SAP EM Web User Interface where carriers can log in and report events. In Europe, EDIFACT is the dominant standard used for communicating statuses while in North America, the dominant standard is ANSI X12.


Globally, no generally accepted mandatory standards exist for how events will be reported by mode or by carrier. Carriers are free to report any and all events as they deem necessary in their own time. In North America, a system for tracking freight as it travels has been in place for almost 100 years and is maintained by the National Motor Freight Traffic Association (NMFTA). The events that occur at the locations defined by the NMFTA are captured via satellite, GPS, barcodes or manually. Records are collected and made available to the public, unfiltered. Around the world, individual carriers collect event information on their own shipments and make this data available to the consumer through their website or via a download file. Often these files fail to provide all events in a trip, or else events will be transmitted out of order, i.e., the event reporting that the ship has left the port occurs before the event reporting that the ship has been cleared to sail by customs. These disparities present a massive challenge to interpreting data made available worldwide for shipment movements. SAP EM, and only SAP EM, is capable of handling the vast amount of diverse information delivered from around the globe into a concise, accessible form for the end user.


Another assimilation of information that SAP EM handles well is the numerous standards for location identification. Although most common worldwide, postal code is not the single uniform method for identifying a geographical location. Longitude and latitude provides a specific point on the globe but are difficult and cumbersome to use on a regular basis - including having to remember if the value is either positive or negative, showing northern or southern hemisphere. The United Nations maintains a list of location codes (UN/LOCODE) for more than 100,000 places in the world. Originally intended to be used to identify seaports and airports, this list of codes has been expanded and is now available to any requester who applies through the UN/LOCODE Entry Request System. The NMFTA maintains Specific Point Locator Codes (SPLC) for geographical locations in North America for use by the rail and trucking industries. Airports are identified worldwide by their unique three-character representation. The increase in global trade has placed a heavy demand on the adaptation of a uniform system that is recognized worldwide for identifying the location where significant events occur during the transport of goods. Again, the best solution for managing this data is found in SAP EM.


For Logistics Service Providers (LSPs), implementing SAP EM, in conjunction with SAP TM, provides a complete solution. An LSP's sole business is to execute transport requests, entrusted by their customers, within specific time limits, while maximizing the use of the LSP's assets. To optimize the use of an LSP's assets — idle assets are non-revenue producing — the LSP needs to know where the assets are located, what is the state of the assets and what dependencies exist upon the assets.


Using SAP EM, the following scenarios can be captured:


1) An inbound full truckload shipment is expected at a cross-docking location. The inbound shipment is at risk of being late. SAP EM would monitor and report the information as follows:

  • The truck left the origin point after its expected departure time. While this delay does not automatically indicate a late arrival at the destination point, SAP EM can generate a warning of the impending situation so the truck can be monitored throughout its trip.

  • Via a mobile device, the driver could report a DELAY event and provide a new estimated time of arrival. The reporting of this event could trigger a series of steps to send a message to the original transportation planner to automatically re-schedule a freight order to have new subsequent estimated times calculated.

  • If the truck is equipped with GPS, SIGHTING events can be reported, giving latitude and longitude along the way. By querying a live traffic web service, real-time estimated time of arrival to destination can be calculated. This real-time estimate can continually be updated throughout the trip by SAP EM and alerts created as the need arises.

2) Frequently, a shipper is contractually obligated to provide expected time of arrival information to a customer. The goods may be perishable, require special handling or need to be delivered by a deadline. Alerting manufacturing customers waiting for raw materials of delays in transports is imperative. If a manufacturer is waiting on raw materials to start production, knowing the arrival time empowers the plant manager to decide whether to switch the next run to a product where the raw materials are already on hand, or closer to being delivered.


3) In a cross-docking scenario, individual deliveries are transferred from one truck or container to another for the LSP to optimize shipments. If one of the trucks or containers is late, a ripple effect occurs, and several shipments could be impacted. SAP EM has the ability to monitor and track any and all shipments that will be affected by a single delay.


4) Proof of Delivery (POD) has become a standard document provided by the carriers. This document can be captured electronically and attached to the POD event in SAP EM. Even if the POD was signed manually, the image can be scanned and attached to the event so it would be available for viewing online by any authorized party. Being able to universally view the signature of the accepting party saves time and money when searching for a lost shipment.


5) SAP TM 9.1 introduced “Event Based” charge calculation functionality. Posted events can trigger charges to be added to a freight order, freight booking or forwarding order. As an example, “Event Based” functionality could be used to determine and add a demurrage charge or an assessorial charge to one of the above-mentioned documents.

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