Preface

23

The Objective of This Book

25

Who Should Read This Book?

25

What Will Be Covered?

25

Acknowledgments

27

1 SAP S/4HANA for Supply Chain

29

1.1 Overview

30

1.2 Architecture

36

1.2.1 In-Memory Processing

36

1.2.2 Real-Time Analytics

36

1.2.3 Improved Data Quality

37

1.3 Solution

38

1.3.1 Streamlined Procure-to-Pay

39

1.3.2 Accelerated Plan-to-Product

41

1.3.3 Optimized Order-to-Cash

42

1.3.4 Enhanced Request-to-Service

43

1.4 Deployment Options

44

1.4.1 On-Premise

44

1.4.2 Cloud

45

1.5 Key Innovations

46

1.6 Summary

49

2 Planning and Scheduling

51

2.1 Planning and Scheduling Basics

51

2.2 Master Data Simplifications

53

2.3 Simplified Sourcing

56

2.4 Material Requirements Planning

57

2.4.1 MRP Live

58

2.4.2 MRP Cockpit

60

2.4.3 Demand-Driven Replenishment

69

2.4.4 Predictive Material and Resource Planning

72

2.5 Production Planning and Detailed Scheduling

74

2.5.1 Production Planning

75

2.5.2 Detailed Scheduling

75

2.5.3 SAP Fiori Apps for PP-DS

77

2.5.4 Combined Production Planning Approach with PP-DS and MRP Live

83

2.5.5 PP-DS and Plant Maintenance Integration

84

2.6 Reporting and Analytics

84

2.6.1 Resource Planning Table

84

2.6.2 Product Planning Table

85

2.6.3 Alert Monitor

86

2.6.4 PP-DS Standard Reports

86

2.7 Summary

88

3 Sourcing and Procurement

89

3.1 Sourcing and Procurement Basics

89

3.2 Master Data Simplifications

90

3.2.1 Business Partners

90

3.2.2 Sourcing Logic

93

3.2.3 Material Master

94

3.3 Operational Purchasing

94

3.3.1 Self-Service Requisitions

95

3.3.2 Services Procurement

96

3.3.3 Managing Purchase Requisitions

99

3.3.4 Purchase Order Processing

99

3.3.5 Purchasing Document Approval

100

3.3.6 Purchase Order Collaboration

102

3.4 Central Procurement

102

3.4.1 Central Requisitioning

103

3.4.2 Central Purchasing

105

3.4.3 Central Contracts

107

3.4.4 Central Sourcing

109

3.4.5 Central Analytics

110

3.4.6 Central Invoicing

112

3.5 Supplier Management

112

3.5.1 Classification and Segmentation

112

3.5.2 Supplier Evaluation

114

3.6 Invoicing and Payables Management

116

3.6.1 Invoice Processing and Collaboration

116

3.6.2 Accounts Payable

116

3.7 Collaborative Sourcing and Contract Management

117

3.7.1 Source Assignment

118

3.7.2 Operational Contract Management

119

3.8 APIs for Sourcing and Procurement

120

3.9 Reporting and Analytics

120

3.9.1 Procurement Overview Page

121

3.9.2 Spend Visibility

122

3.9.3 Contract Analytics

125

3.9.4 Procurement Activities Monitoring

127

3.10 Summary

127

4 Manufacturing

129

4.1 Manufacturing Basics

129

4.2 Master Data Simplifications

130

4.2.1 Material Master

130

4.2.2 Bill of Material/Production Version

133

4.2.3 Work Centers

136

4.3 Production Execution

139

4.3.1 Production and Process Order Processing

139

4.3.2 Shop Floor Control

146

4.3.3 Scrap Management

147

4.4 Production Engineering and Operations

151

4.4.1 Production Engineering

151

4.4.2 Production Operations

152

4.5 SAP Manufacturing Execution

153

4.6 SAP Manufacturing Integration and Intelligence

154

4.7 SAP Plant Connectivity

156

4.8 SAP Digital Manufacturing Cloud

159

4.8.1 Execution

161

4.8.2 Resource Orchestration

162

4.8.3 Insights

163

4.9 Reporting and Analytics

163

4.9.1 Production and Process Order Reporting

164

4.9.2 OEE Management

164

4.10 Summary

167

5 Quality Management

169

5.1 Quality Management Basics

170

5.1.1 Quality Management in Procurement

171

5.1.2 Quality Management in Production

173

5.1.3 Quality Management in Sales and Distribution and Service

175

5.2 Master Data Simplifications

177

5.3 Quality Planning

177

5.3.1 Logistics Master Data

178

5.3.2 Inspection Planning

178

5.4 Quality Inspection

179

5.4.1 Inspection Lots

180

5.4.2 Executing Quality Inspection and Inspection Lot Completion

181

5.4.3 Sample Management

188

5.5 Quality Improvement

190

5.5.1 Quality Notification

191

5.5.2 Quality Certificates

193

5.5.3 Quality Control

193

5.6 Reporting and Analytics

195

5.6.1 Manage Quality Levels

195

5.6.2 Quality Technician Overview

196

5.6.3 Quality Engineer Overview

198

5.6.4 Inspection Lot Analytics

198

5.6.5 Inspection Lot Detailed Analytics

199

5.6.6 Results History

200

5.6.7 Record Defects

201

5.7 Summary

201

6 Plant Maintenance and Asset Management

203

6.1 Plant Maintenance and Asset Management Basics

203

6.2 Master Data Simplifications

204

6.2.1 Managing Technical Objects

205

6.2.2 Reporting and Identifying Technical Objects

207

6.2.3 Managing Task List Master Data

210

6.3 Maintenance Processing

211

6.3.1 Schedule Material Availability Check

211

6.3.2 Maintenance Planning

212

6.3.3 Mobile Device Processing

217

6.3.4 Maintenance Work Orders

222

6.4 Preventive Maintenance

225

6.4.1 Maintenance Plan Scheduling

226

6.4.2 Maintenance Plans with Item Lists

228

6.4.3 Measurement Documents

230

6.5 Predictive Maintenance

232

6.6 SAP Intelligent Asset Management

234

6.6.1 SAP Asset Intelligence Network

235

6.6.2 SAP Asset Strategy and Performance Management

236

6.6.3 SAP Service and Asset Manager

236

6.7 Reporting and Analytics

237

6.7.1 Enterprise Asset Management Information Center

237

6.7.2 Malfunctions

238

6.7.3 Overview Pages

239

6.8 Summary

240

7 Sales Order Management

241

7.1 Sales Order Management Basics

241

7.2 Master Data Simplifications

242

7.2.1 Business Partner Grouping

242

7.2.2 Business Partner Roles

243

7.3 Sales Contract Management

247

7.3.1 Create, Change, and Display Contracts

247

7.3.2 List Incomplete Sales Contracts

249

7.3.3 Sales Contract Fulfillment Rates

252

7.3.4 Manage Subscription Contracts

252

7.4 Sales Order Management and Processing

254

7.4.1 Sales Order Processing

255

7.4.2 Sales Process Analysis

257

7.4.3 Subscription Order Management

260

7.4.4 Credit Card Payment

263

7.5 Available to Promise

263

7.5.1 Product Availability Check

264

7.5.2 Product Allocation

264

7.5.3 Backorder Processing

268

7.5.4 Release for Delivery

270

7.5.5 Alternative-Based Confirmation

271

7.5.6 Supply Protection

273

7.6 Variant Configuration

274

7.6.1 Classic Variant Configuration

275

7.6.2 Advanced Variant Configuration

277

7.7 Sales Billing

278

7.7.1 Billing and Invoicing for Goods and Services

279

7.7.2 Subscription Billing and Invoicing

281

7.7.3 Contract Accounts Receivable and Payable

282

7.7.4 Credit Management

283

7.7.5 Revenue Accounting and Recognition

286

7.8 Output Management

288

7.8.1 BRFplus Overview

288

7.8.2 SAP Fiori Apps for Output Management

289

7.9 Delivery and Shipping Processing

290

7.10 Claims, Returns, and Refunds Management

293

7.10.1 Rebates and Settlement Management

293

7.10.2 Complaint Management

296

7.10.3 Advanced Returns Management

299

7.11 International Trade

303

7.12 Reporting and Analytics

305

7.12.1 Sales Operations Artifacts

305

7.12.2 Sales Analytics

306

7.12.3 Sales Information Display

311

7.12.4 Sales Performance

311

7.12.5 Sales Order Processing

311

7.13 Summary

315

8 Transportation Management

317

8.1 Transportation Management Basics

317

8.2 Master Data Simplifications

318

8.2.1 General Master Data and Organizational Structure

319

8.2.2 Product Master Data

320

8.2.3 Business Partner

320

8.2.4 Dangerous Goods

320

8.2.5 Transportation Network

320

8.2.6 Transportation Schedules

321

8.2.7 Transportation Resources

322

8.3 Transportation Requirements

322

8.3.1 Order and Delivery Management

322

8.3.2 Forwarding Order Management

324

8.3.3 Scheduling Agreements

324

8.4 Capacity Management

325

8.4.1 Strategic Freight Procurement

325

8.4.2 Strategic Freight Selling

327

8.4.3 Tactical Capacity Planning

327

8.4.4 Operational Capacity Planning

328

8.5 Transportation Planning

329

8.5.1 Freight Units

330

8.5.2 Freight Orders

331

8.5.3 Freight Booking

333

8.5.4 Transportation Units

334

8.5.5 Transportation Cockpit

334

8.5.6 Manual Planning

338

8.5.7 Automated Planning

339

8.5.8 Distance and Duration Determination

347

8.5.9 Service Order

347

8.5.10 Direct Shipments

347

8.6 Carrier Selection and Subcontracting

347

8.6.1 Carrier Selection Constraints

348

8.6.2 Freight Tendering

349

8.7 Transportation Monitoring and Execution

353

8.7.1 Documentation and Output Management

354

8.7.2 Event Management

354

8.8 Freight Charge Management and Settlement

356

8.8.1 Charge Calculation

356

8.8.2 Charge Settlement

358

8.8.3 Cost Distribution and Internal Settlement

361

8.9 Reporting and Analytics

362

8.9.1 Freight Order Execution

362

8.9.2 Freight Tendering

364

8.9.3 Freight Booking Execution

366

8.10 Summary

367

9 Inventory Management

369

9.1 Inventory Management Basics

369

9.2 Master Data Simplifications

370

9.2.1 Batch Management

371

9.2.2 Material Numbers

371

9.2.3 Aggregate Tables

372

9.2.4 Blocking Customer and/or Supplier Records

372

9.2.5 Locking versus Logistics Information System

373

9.2.6 Transaction MIGO

373

9.3 Material Movements

373

9.3.1 Goods Receipt from Vendor

373

9.3.2 Stock Transfer between Storage Locations

375

9.3.3 Stock Transfer between Plants

380

9.3.4 Post Goods Movement

385

9.4 Handling Unit Management

386

9.5 Physical Inventory Management

388

9.6 Inventory Valuation

390

9.6.1 Goods Movement Valuation

390

9.6.2 Statistical Moving Average Price

391

9.7 Product Segmentation

392

9.8 Reporting and Analytics

394

9.8.1 Inventory Turnover Analysis

394

9.8.2 Material Documents Overview

396

9.8.3 Material Document List

396

9.8.4 Material Inventory Values

397

9.8.5 Stock Overview

398

9.9 Summary

399

10 Warehouse Management

401

10.1 Warehouse Management Basics

402

10.1.1 Traditional versus Extended Warehouse Management

402

10.1.2 Basic versus Advanced Warehouse Management

404

10.1.3 Stock Room Management versus Extended Warehouse Management

407

10.2 Master Data Simplifications

408

10.2.1 Business Partners

408

10.2.2 Material Master

410

10.2.3 Batch Master

410

10.2.4 Dangerous Goods and Hazardous Substances Data

411

10.2.5 Handling Unit Type

411

10.2.6 Remote Function Call Communication

411

10.2.7 Freight Order Management

412

10.2.8 Route Determination

412

10.3 Inbound Processing

412

10.3.1 Receiving from Vendor

413

10.3.2 Receiving from Production

414

10.3.3 Receiving for Plant-to-Plant Transfers

415

10.3.4 Quality Management Integration

416

10.3.5 Inbound Documents

416

10.4 Outbound Processing

420

10.4.1 Issuing for Customers

420

10.4.2 Staging and Consumption for Production

422

10.4.3 Unplanned Goods Issues

423

10.4.4 Return from Customers

425

10.4.5 Freight Order versus Transportation Unit Integration

426

10.5 Internal Warehouse Processing

427

10.5.1 Posting Change

427

10.5.2 Replenishment

428

10.5.3 Kitting

429

10.5.4 Slotting

430

10.5.5 Ad Hoc Movements

431

10.5.6 Serial Numbers by Plant (Harmonization)

432

10.6 Dock Appointment Scheduling

433

10.7 Transit Warehousing

434

10.7.1 Transit Warehousing Process

435

10.7.2 Planning with Trailers

436

10.8 Reporting and Analytics

436

10.8.1 The Warehouse Monitor

437

10.8.2 The Warehouse Cockpit

437

10.8.3 Stock Comparison

438

10.9 Summary

439

11 Reporting and Analytics

441

11.1 Business Intelligence Maturity

441

11.1.1 Reporting

442

11.1.2 Analytics

442

11.2 Tactical Reporting in SAP S/4HANA

444

11.3 SAP S/4HANA Embedded Analytics

449

11.3.1 Architecture

450

11.3.2 SAP Smart Business Cockpit

451

11.3.3 KPI Designer

452

11.3.4 Analysis Path Framework

453

11.3.5 Query Designer

454

11.3.6 Query Browser

455

11.3.7 Advanced Analytics

456

11.3.8 Integration for Analytics

457

11.3.9 Analytics Tools

458

11.4 Summary

460

12 Logistics Innovations with SAP Business Technology Platform

461

12.1 Intelligent Technologies in SAP BTP

461

12.2 Integration with Blockchain

463

12.3 Intelligent Robotic Process Automation

465

12.4 Internet of Things and Edge Services

466

12.4.1 Internet of Things

467

12.4.2 Edge Services

468

12.4.3 Mixed, Virtual, and Augmented Reality

469

12.5 Conversational AI

470

12.6 Machine Learning

472

12.7 Summary

473

13 Industry

475

13.1 What Is Industry 4.0?

475

13.2 Digital Supply Networks

477

13.3 Consumer and Industrial Products

482

13.3.1 Faster Customer Delivery Times

482

13.3.2 Material Requirements Planning and Integrated Business Planning

483

13.3.3 Accelerated Product Development

484

13.3.4 Responsive Supplier Collaboration

485

13.3.5 Manufacturing Asset Efficiency and Cost Optimization

486

13.4 Life Sciences

487

13.4.1 Unique Device Identifier

487

13.4.2 Tax-Advantaged Supply Chain

488

13.4.3 Track and Trace

490

13.5 Oil and Gas

491

13.5.1 Inventory Planning and Execution

491

13.5.2 Commodity Management

493

13.5.3 Upstream Operations Management

494

13.6 Technology, Media, and Telecommunications

496

13.6.1 Billing and Revenue Management in the Subscription Economy

496

13.6.2 Supply Chain Collaboration

498

13.6.3 Semiconductor Industry and Supply Challenges

500

13.7 Summary

501

14 SAP S/4HANA and the Cloud

503

14.1 Cloud Computing with SAP

503

14.1.1 Cloud Architecture

504

14.1.2 SAP S/4HANA Cloud

505

14.1.3 Choosing the Cloud

508

14.1.4 Operating in the Cloud

508

14.2 SAP Ariba

509

14.2.1 Spend Analysis

510

14.2.2 Supplier Management

511

14.2.3 Sourcing and Contracts

511

14.2.4 Procurement and Invoice Management

513

14.2.5 Supply Chain

514

14.2.6 SAP Business Network

514

14.2.7 Direct Spend Solutions

515

14.2.8 Integration with SAP S/4HANA

516

14.3 SAP Integrated Business Planning

518

14.3.1 Sales and Operations Planning

519

14.3.2 Demand Planning

520

14.3.3 Response and Supply Planning

521

14.3.4 Inventory Planning

522

14.3.5 Demand-Driven Replenishment

522

14.3.6 SAP Supply Chain Control Tower

523

14.3.7 User Experience

525

14.3.8 Integration with SAP S/4HANA

526

14.4 Summary

527

15 First Steps to SAP S/4HANA

529

15.1 Business Transformation Goals

529

15.1.1 Confirming Your Business Priorities

530

15.1.2 Evaluating Business Processes in SAP S/4HANA

531

15.2 Defining a Digital Transformation Roadmap

533

15.2.1 Designing Your Roadmap

534

15.2.2 Sharing Your Roadmap

536

15.2.3 Planning and Implementing Your Roadmap

536

15.3 Selecting an SAP S/4HANA Implementation Approach

541

15.3.1 New Implementation (Greenfield)

542

15.3.2 System Conversion

543

15.3.3 Selective Data Transition

544

15.3.4 SAP Activate Methodology

545

15.4 RISE with SAP

548

15.4.1 Business Process Intelligence

548

15.4.2 SAP Business Technology Platform

549

15.5 Summary

550

Appendices

553

A SAP Fiori Applications for Logistics with SAP S/4HANA

553

A.1 Planning and Scheduling

553

A.2 Sourcing and Procurement

560

A.3 Manufacturing

561

A.4 Quality Management

563

A.5 Plant Maintenance and Asset Management

565

A.6 Sales Order Management

566

A.7 Transportation Management

570

A.8 Inventory Management

572

A.9 Warehouse Management

573

B The Authors

575

The Contributors

576