Details on SAP

Extended Warehouse
Management’s (EWM)
Inbound and Outbound
Processing Capabilities

Patti Gardner
SAP Labs
Landscape
Inbound Processing

Outbound Processing

Internal Warehouse Processes

Wrap-up
 Roadmap WM: Enterprise Focus — Today

SAP Warehouse Management (WM) focusing on enterprise-centric

processes for warehousing and storage
„ Warehouse internal movements and replenishment for storage bins
„ RF- and voice-supported put-away and picking
„ Optimized warehouse movements using Task and Resource Management
‹ Dynamic route planning in the warehouse
‹ Task interleaving
„ Inventory Management on storage bin level with Batch Management and
shelf life expiration dates
„ Warehouse internal packing

Architecture options:
„ Integrated or
„ Decentralized

© SAP AG 2006, 3
 Landscape Overview — Decentralized WM (SAP ECC)

SAP CRM SAP SRM ERP SAP SCM

TRM
WM
WM TRA
TRA
„ Full SAP ECC
installation
IM
IM SD
SD PP
PP QM
QM PM
PM
„ Only Warehouse LE
LE
HR
HR FI
FI
Management Logistics
Logistics
configured
Cross
Cross Application
Application Objects
Objects (SAP
(SAP ABA)
ABA)

Web
Web Application
Application Server
Server (SAP
(SAP Web
Web AS)
AS)
Decentralized WM

© SAP AG 2006, 4
 Enterprise, Service Parts Execution, and
Network Focus

Integrated Scenario Decentralized ERP Scenario

ERP
Other
ERP ERP
WM
Logistics
FI/CO

SAP SAP
SAP Extended
ERP LES LES WM
SAP SCM
WM Dec WM = full SAP ECC system

SAP Warehouse Management Extended Warehouse Management (focus on

(as integrated or decentralized WM) Service Parts Execution processes)

Enterprise Focus SPE/Network Focus

© SAP AG 2006, 5
 Roadmap WM: Service Parts Management

Bring together Product and Service Supply Chain for a

comprehensive solution in planning and execution
Key characteristics for Service Parts WM:
„ High SKU volumes and line item volumes
„ Very fast and very slow-moving items competing for the same
warehouse space
„ Vast product differences — size, weight, model year, serial
number, country of origin, batch, and valuation
„ Complex cross-docking and order-fulfillment processes
„ Detailed packaging and shipping logistics
„ Integration of third-party logistics (3PL) services for packaging
(inbound) and packing (outbound) of products
„ 3PL and outsourcing support for consolidators and carriers using
portal capabilities

© SAP AG 2006, 6
Service Parts Management — Building Blocks

SAP SCM 5.0 SAP CRM 5.0

Service Parts Planning Service Parts Execution
• Strategic Supply Chain Design • Marketing Campaign Processing
• Parts Demand Planning • Sales Order Processing
• Parts Inventory Planning • Billing incl. Invoice Corrections
• Parts Supply Planning and Entitlement Management
• Parts Distribution Planning • Complaints and Returns Processing
• Parts Monitoring • Analytics
• Supply Network Collaboration • Execution Collaboration
• Supply Chain Analytics

SAP NetWeaver 2004s

Service Parts Execution
• Quality Assurance and Control
• Warehousing and Storage
• Physical Inventory SAP ERP 2005
• Cross Docking
• Outbound Processing Service Parts Execution
• Transportation Management • Purchase Order Processing
• Execution Monitoring • Inbound Processing and
• Execution Collaboration Receipt Confirmation
• Analytics • Analytics

SAP NetWeaver 2004s

SAP NetWeaver 2004s

© SAP AG 2006, 7
 Landscape Overview — Decentralized EWM
(SAP SCM 5.0)

Central SRM Central MDM SAP

SCM ERP CRM

SAP APO

„ Fully integrated
into SCM suite
SNP PP
PP
DP
DP TP/VS
TP/VS SNP gATP
gATP
DS
DS
„ Installation on a
separate server is
EWM
EWM SPP EM ICH
SPP EM ICH
Live
Live Cache
Cache
recommended
Cross
Cross Application
Application Objects
Objects (SAP
(SAP ABA
ABA 7.00)
7.00)

Web
Web Application
Application Server
Server (SAP
(SAP Web
Web AS
AS 7.00)
7.00)

SAP SCM 5.0

© SAP AG 2006, 8
 Key Capability: Service Parts Execution

Service Parts Execution enables a logical flow of parts through

the service network

This includes:
„ Procurement
„ Goods movement of new parts and returned parts
„ Quality Management, and
„ Warehouse and Storage Management

New Parts
Quality
Inspections
Warehouse
Management
Goods Movement

Returned Parts
Repair Services

Physical
Inventory

Cross-Docking

© SAP AG 2006, 9
 Service Parts Execution

„ Warehouse Monitor for overview of all warehouse activities

Parts Execution Monitoring

Parts
Inbound Parts Parts Quality Physical Parts Cross-
Warehousing
Processing Management Inventory Docking
and Storage

„ Stock visibility in staging area Warehouse optimization „ Physical inventory „ Transportation

„ Counting triggered by various „ Slotting: Find the best bin management based cross-docking:
criteria for a material on various strategies Forward parts to the
„ Bundling: Group warehouse (strategy for slow end facility/customer
„ Packaging for consolidation and
management requests to movers, fast movers, via one or more
deconsolidation of critical parts, etc.) intermediate facilities
optimize picking, packing, and
parts/inbound packaging for long-
staging of goods
term storage
„ Transportation chain route
„ Scrapping requests (all or optimization
except best n pieces) and „ Kitting: Enhanced kit-to-order
scrapping strategies for part process
identification
„ Rules-based rebalancing
„ Enhanced customer returns based on planning results
management process and „ Flexible warehouse modeling
full visibility (storage bins, staging areas,
„ Contract Packager inbound work stations)
processing „ Emergency replenishment –
picker encountered empty bin
„ Picker-directed replenishment
– picker does replenishment by
himself
© SAP AG 2006, 10
 The Scope of Supply Chain Has Increased
Trading Partners Enterprise View Network View

Historical data
Long
Long term
term
Faster order planning
planning
to delivery
cycles Mid
Mid term
term
planning
planning

Short
Short term
term Replenishment
Replenishment
planning
planning
Shorter
product life
cycles Sense and Respond
to Demand Customers
and
Consumers
Faster High
Warehouse Higher
product Warehouse Availability
Management Service
development Management
Levels As Needed
cycles Transportation
Transportation
Management
Management

Suppliers Distribution Centers (DC) Stores

Manufacturing
Manufacturing
© SAP AG 2006, 11
 The Reality of a Complex Supply Chain Network is an
Everyday Occurrence
Suppliers Manufacturer Regional Retail and/or Customers
DC Wholesale and
DC Consumers
„ Single channel
supply chains
are no longer
the norm Repair
North

„ All or portions
of your supply
chain may be West

outsourced
Returns

„ Product will flow

in numerous East
directions Returns

„ Adapting to
changes quickly
is no longer
an exception
process

© SAP AG 2006, 12
 Success in a Supply Chain Network Requires Integrated
Planning and Execution by Design (Not After the Fact)

Global Visibility and Event Management

Plan PUSH Execute

Long
Long term
term
planning
planning Demand
Demand
Fulfillment
Fulfillment
Mid
Mid term
term
planning
planning Shipment
Shipment
Management
Management
Trading Short
Short term
term Customers
Partners planning
planning and
Trading
Trading Partner
Partner Consumers
Enablement
Enablement
Supplier
Supplier
Learn
Collaboration
Collaboration
Manufacturing
Manufacturing
Order
Order
Fulfillment
Fulfillment
PULL
Replenishment
Replenishment
Signal
Signal

Respond Sense

Suppliers Manufacturer Distribution Centers Stores

© SAP AG 2006, 13
Landscape
Inbound Processing

Outbound Processing

Internal Warehouse Processes

Wrap-up
 EWM Inbound Process

New New New

New Enhanced

ASN Validation Transport Manage

Slotting Receive ASN Data and Correction Unit Arrival Transport Unit

New New
Enhanced Enhanced

Goods Putaway Bin Unload

Deconsolidation
Receipt Determination Transport Unit

New (Internal Enhanced

Routing)

Putaway
New
Process Exceptions/Manage Work in Process

© SAP AG 2006, 15
 EWM Inbound Process: New Processes

Pick from Receiving/

Transportation Cross-dock
Push Deployment

Returns/Reverse Logistics Packaging Execution

© SAP AG 2006, 16
 EWM — Inbound Delivery Processing

Inbound delivery notification:

Represents the inbound delivery/ASN
from ERP System. Serves as
reference for quantities.
Inbound delivery: a.k.a., Warehouse
Request. Serves as the reference for
further processing in EWM.

© SAP AG 2006, 17
 EWM — Inbound Delivery Processing (cont.)

Creation WT #1234
Inbound WT
Delivery Prompt Inbound #1233WT
1:1 Notification creation
#1235
delivery
8026 (ERP)
Whse 003
1:1 #25002(int.)
Whse 003 Confirmation

Messages: Response
ERP
Inbound Messages: Delivery Info
Delivery

EWM

© SAP AG 2006, 18
 Complex Putaway Process with Internal Routing
Prod. WT
Mat. 1

Goods Receipt
SType: 9010 Deconsolidation Station: AP1
Bin: GR-ZONE SType: APDK
1 Sec: Sec: 0001
3 Step: IB02 AP1I Bin: AP1

2 Step: IB01 Deconsolidation Bin:

Unloading AP1I
Type: 9030
Bin: Door1
Step: IB03 4
Put-away

Prod. WT
Mat. 2

Final Final
SType SType
JK01 JK04
AA: PT01 AA: PT04
C.Gr.: ICG01 C.Gr.: ICG04
© SAP AG 2006, 19
 Multiple Materials on a Single Pallet

Material Material
1 2

Ptwy Strategy Ptwy Strategy

JK04 JK01

SType Search Seq SType Search Seq

JK04 JK01

SType SType
JK04 JK01

Activity Area Activity Area

PT04 PT01

Consolidation Gr Consolidation Gr
ICG04 ICG01
© SAP AG 2006, 20
 Storage Control

The goal of Storage Control is to display your complex putaway or stock

removal process steps based on your processes or your layout data

‰ Process-Oriented:
‰ Managing storage control based on the warehouse process

‰ Layout-Oriented:
‰ Managing storage control based on the warehouse layout

‰ Combination:
‰ EWM always executes the process-oriented storage control first.
The layout-oriented storage control then checks whether the
sequence of putaway process steps is possible in layout view,
and if required, adjusts the flow of the putaway or stock removal.

© SAP AG 2006, 21
 Complex Putaway Procedures

Complex Putaway Procedures can be configured via Process-

Oriented Storage Control (Internal Routing)

Process-Oriented Storage Control works only with Handling Units (HUs)!

Possible steps in a putaway process are:

„ Unloading
„ Counting
„ Deconsolidation
„ Value-Added Services (Packaging)
„ Quality Inspection
„ Putaway

© SAP AG 2006, 22
 Layout-Oriented Storage Control

You can use the Layout-Oriented Storage Control if stock

movements in your warehouse do not occur from a source storage
bin to a destination location directly, but rather via intermediate
storage bins
Layout-Oriented Storage Control works only with HUs unless you
are using picking or identification points
Use Layout-Oriented Storage Control in the material flow system to
define conveyor segments

Example:
If you want to move a product pallet from storage bin A (goods
receiving area) to storage bin B (high rack storage area), the system
should execute a contour and weight check to ensure that the product
pallet can be put away in the high rack storage area safely. For this
activity, EWM splits the warehouse order into two: One from storage
bin A to identification point I, and a second from identification point
I to storage bin B.

© SAP AG 2006, 23
 Layout-Oriented Storage Control for HU Movements
Handling Unit

Basic HU Warehouse Task

Concept
Z Node
WT not active Î

A WT not active Î Z

Active WT Î WT active Î

B C

Active WT Î

From To Intermediate
A Z B
B Z C
© SAP AG 2006, 24
 Direct Storage Control for Stock Removal

© SAP AG 2006, 25
 Combined Storage Control for Stock Removal

© SAP AG 2006, 26
 Updating the Outbound Delivery Order
EWM updates the Outbound Delivery order corresponding to the goods
issue activities for the following GI processes:
Unpacked Stock:
When the first product warehouse task is generated, EWM sets the
status Picking Planning in the outbound delivery order
On confirmation, EWM sets the status Picking in the outbound delivery
order. If the destination location in the product WT is a storage bin at the
door or a Transportation Unit (TU), EWM sets the status Unloading in the
outbound delivery order.

Packed Stock:
When the first product warehouse task is generated, EWM sets the status
Picking Planning in the outbound delivery order
On confirmation, EWM sets the status Picking in the outbound
delivery order
After packing, the related loading WT is generated. On confirmation of the
loading WT, EWM sets the status Loading in the outbound delivery order.

© SAP AG 2006, 27
Landscape
Inbound Processing

Outbound Processing

Internal Warehouse Processes

Wrap-up
 EWM Outbound Process

Enhanced New Enhanced New

Route Wave Picking Warehouse

Order/Sourcing Determination Management Bin Orders
Determination

Enhanced Enhanced New New New

Loading
Work and
Picking Packing Shipping Staging
Assignment Goods Issue

New
New
Process Exceptions/Manage Work in Process

© SAP AG 2006, 29
 EWM — Outbound Delivery Processing

„ Outbound Delivery:
Represents the same data as ERP
checked delivery. Serves as
Unchecked Delivery
quantity reference for further
processing in EWM.
„ Outbound Delivery Order:
Warehouse Request; is comparable
with ERP Delivery. All further
picking is based on Outbound
Delivery Order.
„ Outbound Delivery:
Outbound Delivery Order Represents the physical GI
Quantities that are posted in EWM.
In Export cases this might be
Outbound Delivery created before the GI Posting in
EWM. In other cases it will
automatically be created with the
GI Posting for the Outbound
Delivery Order in EWM.
© SAP AG 2006, 30
 Outbound Example

„ Receive CRM orders through ERP into EWM

„ EWM receives these as Warehouse Requests
„ These Warehouse Requests are assigned to a Wave on Item Level
„ Wave is released
„ Warehouse Orders (WOs) are created according to Warehouse Order
Creation Rule
„ Warehouse Orders are picked and HUs may be moved to a packing area
or staging area
„ Packing is done at a Packing Workcenter
„ Product moves through the warehouse during these steps according to the
internal process routing

„ Loading and shipping

„ Products are loaded into the right Transport Unit, assigned to a Door
„ Loading/Shipping can be done by TU, Vehicle, or Door

© SAP AG 2006, 31
 Overview — Outbound Process
WHR
WHR11
WHR1
WHR1
WHR1
A list of Warehouse Requests is created

These Warehouse Requests are grouped

into a single wave Wave 1

Based on the wave, numerous Warehouse Tasks

will be created
Task
WHR11 Task
WHR1n
WHR1
WHR1 WHR1
WHR1
WHR1 WHR1

All Tasks will pass the “Black Box” Warehouse

Order creation. Warehouse Orders are created
according to the Warehouse Order Creation Rule
defined in customizing.
Warehouse Order
The Warehouse Order Creation Rule is determined Creation

from the Activity Area that influences the routing

Warehouse Orders can contain items from WO 1 WO 2 WO n
multiple deliveries Task
WHR1
WHR1
WHR1
WHR1
Task
WHR1
WHR1
WHR1
WHR1
Task
WHR1
WHR1
WHR1
WHR1

© SAP AG 2006, 32
 EWM — Outbound Delivery Processing

ERP delivery
Outbound
Outbound contains 1
Delivery Immediate
creation/ delivery warehouse only
1:1 Request
deletion order
(read only) 1:1

ERP unchecked delete WM forecast

outbound
DLV
delivery
#18046(int.)
Creation WT #1234
N:M
Order Outbound WT
Combination Delivery Immediate WT Late Delivery
Outbound #1233
1:1 Request creation #1235 creation by
delivery execution (e.g.,
1:1 order loading)
DLV
Confirmation 1:N
#18047(int.)

ERP outbound
delivery
Messages: Delivery Info Delivery Processing
request WM processing
Messages: Final Delivery Info

SAP EWM

© SAP AG 2006, 33
 Process-Oriented Storage Control

Possible steps in a picking process are:

„ Picking
„ Value Added Service (Kitting)
„ Quality Inspection
„ Packing
„ Staging
„ Loading

© SAP AG 2006, 34
 Overview — Outbound Process

WO 1 WO 2 WO n
Internal Routing
Task
WHR1 Task
WHR1
WHR1 Task
WHR1
WHR1
WHR1
WHR1
WHR1 WHR1
WHR1 WHR1
WHR1

Following are the possible steps to support

the outbound process
ƒ PICK PICK PICK

ƒ VALUE ADDED SERVICES

ƒ QUALITY INSPECTION
ƒ PACK PACK

ƒ STAGE
ƒ LOAD
STAGE VAS

LOAD PICK LOAD

© SAP AG 2006, 35
 Warehouse Order Creation Rules in Action
Single Task Grouped by Activity Area
2 3 5 6
Consolida-
AA1 AA1 AA1
Apply Item tion Group
Filter of BR Σ Σ
Σ Subtotals
AA2 PA2
AA2 PA2
AA2

AA3 PA3
AA3 PA3
AA3

Filter on
7 Subtotals level
Warehouse AA1 PA1
AA1
1 Wave Release/ Order Creation
Warehouse Task 4 Rule Search Apply
Creation Σ
Σ Limits
AA3 AA2 AA1 9 AA2 PA2
AA2
and
WOCR2 WOCR4 WOCR1 AA3 PA3
AA3
WOCR5 WOCR5 WOCR2 Create
WOCR3
Pick-HUs

WO3
Warehouse Order Creation
Rules per Activity Area 8 WO1

WO2

© SAP AG 2006, 36
Outbound Process with Internal Routing

Pick-HU
HU# 462910

Packing Workcenter Ship Staging area

TD10 9020

Activity Area = TD01

Door
Pack-HU Pack-HU TU
HU# 462912 HU# 462912 Vehicle

Pick-HU
HU# 462911

Activity Area = 0020

© SAP AG 2006, 37
Landscape
Inbound Processing

Outbound Processing

Internal Warehouse Processes

Wrap-up
 EWM Internal Warehouse Processes

New New New

Enhanced
Yard Management Quality Inspection Engine Inventory Counts
Record Accuracy

New Enhanced
New

Kitting Rearrangement
Replenishment

New
Process Exceptions/Manage Work in Process

© SAP AG 2006, 39
 Slotting
Slotting automatically determines a storage concept for a product

The system determines the underlying storage parameters that are

relevant for putaway on the basis of master data, including:
ƒ Product data
ƒ Storage requirement data
ƒ Packaging data

These parameters describe

ƒ The storage section in which the product is to be stored
ƒ The properties that the storage bin is to have
ƒ The putaway strategy that is to be used

Slotting takes into account master data that is not dependent on the
execution process. If the putaway process for a product is dependent
on execution parameters, this dependency is taken into account later
on during storage bin determination. This does not, however, have an
effect on the results of slotting.

© SAP AG 2006, 40
 Slotting (cont.)

© SAP AG 2006, 41
 Slotting (cont.)

Slotting Process

Storage Section Storage Section

Indicator Search Sequences

BAdI-based
Product Storage Rules
Determination Table
data (Defaults for process-
Fixed
dependent parameters) Storage Bin
Product Demand
data
Product Storage Type Search
to Slot Putaway Strategy
Sequence
Product Hazard
data
Storage Type
Maximum
BAdI-based
Product HU data Quantities
Rules

Bin Type Bin Type Search Sequences

Slotting Result

Search Sequence
BAdI-based
Parameters independent of Rules
Execution process
Parameters depending on
Execution process

© SAP AG 2006, 42
 Slotting (cont.)

Result of slotting:

ƒ Slotting determines the following storage parameters and updates the

product master:
ƒ Putaway strategy
ƒ Maximum quantity in storage type
ƒ Storage section indicator
ƒ Storage bin types

ƒ Slotting could also determine a fixed bin for product

ƒ Slotting provides the basis for rearrangement (carrying out the results
of the slotting run)

It is also possible to simulate the slotting run

© SAP AG 2006, 43
 Physical Inventory

‰ Periodic Inventory

‰ Continuous Inventory

‰ Cycle Counting

‰ Features:
‰ Annual Inventory (location or product)
‰ Cycle Counting (product-specific)
‰ Ad Hoc (location or product)
‰ Putaway (location-specific)
‰ Zero Stock (location-specific)
‰ Low Stock (location-specific)
‰ Product in Right Location (location-specific)

© SAP AG 2006, 44
 Physical Inventory (cont.)

‰ Difference Analyzer
9 Evaluate Differences
9 Enter Notes
9 Enter Corrections
9 Clear Differences (EWM and ERP)

‰ Radio Frequency Support

9 Create Physical Inventory Documents
9 Enter Count Results
9 Post Differences (EWM)

‰ Stock Types
9 Unrestricted Use Stock in putaway and in the warehouse
9 Blocked Stock in putaway and in the warehouse
9 Quality Stock in putaway and in the warehouse

© SAP AG 2006, 45
Landscape
Inbound Processing

Outbound Processing

Internal Warehouse Processes

Wrap-up
 Resources

„ Online Help (http://help.sap.com/)

Select Documentation Æ mySAP Business Suite Æ SAP Supply Chain
Management Æ SAP SCM 5.0 (select language) Æ SAP Extended
Warehouse Management (SAP EWM)

„ SCM Portal (http://service.sap.com/scm)*

Choose Warehousing, and then either ERP EWM or SCM EWM

* Requires login credentials to the SAP Service Marketplace

© SAP AG 2006, 47
 7 Key Points to Take Home

„ Deployment options for SAP's Warehouse Management

functionality include running ERP WM in an integrated
scenario, ERP WM in a decentralized scenario, or SCM EWM
5.0 in a decentralized scenario

„ SAP Extended Warehouse Management in SCM 5.0 offers

you scheduled and efficient processing of all logistics
processes in the warehouse

„ EWM is completely integrated into Inventory Management

and Delivery Processing

„ Business processes triggered in other application

components lead to physical movements in your warehouse.
These movements are organized, controlled, and monitored
by EWM.

© SAP AG 2006, 48
 7 Key Points to Take Home (cont.)

„ Complex putaway process steps take into account your

warehouse layout as well as your warehouse process rules and
process flows

„ Inventory Management and EWM are fully integrated. Using

physical inventory procedures and entry of stock differences, the
system ensures that the book value in Inventory Management
always matches the warehouse stock in EWM.

„ Slotting is the automatic determination of a storage concept for a

product. Slotting can be run based on product data, requirement
data, or packaging data. Rearrangement follows slotting to carry
out the recommendations made in the slotting run.

© SAP AG 2006, 49
 Contact Information

Questions?

For further information, please contact:

Patti Gardner ([email protected])

Markus Rosemann ([email protected])

Richard Kirker ([email protected])

© SAP AG 2006, 50
 Thank you for your interest and attention!

© SAP AG 2006, 51
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© SAP AG 2006, 52