Updated: Jan 29, 2022
SAP LE -
SAP LE is one of the important components of SAP ECC and it includes execution of entire logistics of any organization or company. It basically supply chain solution and manages entire supply chain of the company from goods receipt to goods issue. So in short it covers all the important processes for movement of goods from the vendor or company warehouse to the distribution Centre or final customer.
Logistics Execution includes Warehouse Management, Shipping and Transportation and it supports the processes from other logistics modules e.g. Production planning and control, Warehouse management, Materials management and Sales and distribution.
Logistics execution is a linkage from procurement of goods to distribution and no matter if the processes are internal or involve third parties like vendor, customers and service providers.
Materials produced in house or purchased from vendor ( third party products) are put away and removed from storage using warehouse management either to supply manufacturing of own goods or selling to customers by using shipping and transportation functions.
1) LE-WM- Useful for storing and maintaining current stock of inventory and manages all goods movement like receipts, issue and stock transfer orders in automated manner. Monitor and optimize flow of goods by advanced techniques like picking, put away.
2) LE-SHIP- Monitor due date for shipping and creating and processing outbound deliveries and for that various functions carried out shipping point determination, route determination. Picking and packing of goods for issue happens and shipping documents created.
3) LE-TRA- It refers to proper and effective transportation planning to reduce the cost for both incoming and outgoing goods shipments. It includes functions- Planning transport, shipment creation and monitoring, cost calculation and settlement, freight cost calculation, service agent selection, follow up and supervision of shipments.
To overcome the various challenges faced by today’s business and industries regarding the transportation issues and cost SAP TM introduced by SAP as standalone application to meet the complex distribution scenarios. SAP TM focuses on reducing the transport cost and improves efficiency by managing all inbound/outbound as well as domestic and International freight.
Less transportation cost will have positive effect on the material price in the competitive market so industries or customers more focusing on optimizing their resources with proper transportation planning and SAP TM is the right selection.
SAP TM provides the following functionalities which are more advanced than ECC LE-TRA-
Freight management-Due to advanced analysis and forecasting it streamlines the freight procurement and automates rate determination by quote to contract process.
Sales order management - LE TRA works at the delivery level while SAP TM works at the order level and integrates order and delivery information. Material availability date (MAD) is calculated by scheduling and during the date calculation transit time and transportation lead time also included to determine the delivery date at customer’s place so it corrects the sales order scheduling as per delivery commitments to customers. It adjusts with real time transportation demand.
Transportation planning: SAP TM provides advanced planning options like map based or automated planning, route and build pallets with rule based utilization and capacity optimization. SAP TM can consider non-availability of resources, incompatibilities, also tract and manage driver resources.
Selection of carriers: Determination of carrier in LE-TRA is very basic (like the default of Forwarding agent as a partner in customer or stage of shipment). SAP TM provides very extensive functionalities for selection of carrier based on cost, priority, allocations, business shares etc.
Transportation execution -Automatically updates freight documents and also shares vehicle/truck information.
Combination of inbound and outbound deliveries in a shipment: Outbound delivery and inbound delivery cannot be combined in shipment in LE-TRA due to different shipment types are different for inbound and outbound shipments. However, SAP TM has no such limitation.
Freight cost and settlement- : SAP TM provides advanced cost management and calculates and allocates freight cost accurately across all materials and orders.
Analytics and reporting -Provides real time data to ease the decision making with dashboards regarding freight cost and determining the rates and resources.