SAP Warehouse Management (SAP WM) or SAP Extended Warehouse Management (SAP EWM) 2014

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SAP Warehouse Management Functionality or
SAP Extended Warehouse Management.
Which Solution Is Right for Your Business?
Created on: 29/05/2014
Version 1.3
Copyright © Rocket Consulting Limited 2014.
All Trademarks are hereby acknowledged.
This document contains information that is proprietary to Rocket Consulting
and must not be disclosed in whole or in part to any third party.

In This Session
Look at the history and evolution of the SAP warehouse offerings
Review the high level functionality of each solution
Look at the key functional differences between EWM and WM
Review how you can assess your warehouse platform selection
Look at the wider implications and implementation considerations for each solution
Review why businesses have selected their warehouse management solution

What We’ll Cover
History and evolution of SAP Warehouse Management
High level SAP warehouse functionality map
Key functional differences between EWM and WM
How do you decide?
Why wouldn’t you implement EWM?
EWM Implementation –case studies
Wrap-up

History and Evolution of WM
SAP has a long history of warehouse management

SAP’s Stated Mission Summary
To have the World’s Best Supply Chain Execution Platform, that is:
Best-in-class
Verticalised
Integrated
Connected

Warehouse Management Positioning
Basic warehouse processes
Simple warehouse operations
Small and medium size warehouses
Comprehensive warehouse processes
Full process transparency
Flexible automated processes
High performance, high volume warehouse operations
Medium and large size warehouses

What Are the Functional Differences?
SAP Extended Warehouse Management system is not a replacement for the SAP WM system
The SAP ERP WM system remains a viable alternative for many warehouses
One of the main differences between SAP WM and SAP EWM is:
The WM system is more inward focused
There is very little functionality that provides a link to external processes, such as transportation cross-docking and transportation
WM can save time and cost, but using it when EWM is needed can be an expensive mistake.

WM —High Level Overview
SAP developed WM to be the link between materials management (MM), shipping, and transportation from Sales and Distribution (SD), providing:
Storage-bin level inventory management
Mapping and control of all goods movements
Monitoring the processing of these goods movements
A connection to mobile data entry as part of the integrated radio frequency solution
A connection to specialist external systems using an interface

EWM —High Level Overview
SAP developed EWM to be a “best-in-class” warehouse management system:
Covering all industries
Covering distribution centres and production warehouses
Supporting simple and complex high volume operations
Providing built in optimization and automation
Providing industry-specific support
WM evolved as part of SAP ECC. EWM was a strategic re-design from the ground up.

EWM —High Level Highlights
EWM provides the following cross-functional benefits and differentiators from WM:
Enhanced reporting and analytics
Built-in optimization
High performance execution
Integration with SAP Business Suite applications
Integration with leading edge warehouse technology
High degree of flexibility and adaptability

EWM —High Level Overview
ERP
WM
ERP
WM + TRM
SCMEWM
Client SAProadmap
Multiple businesses and owners of stock
Business/customer-specific process
Value-added services
Multiple-ERP process integration
Labour management
Operational reporting
Native RF transactions
Yard management
SAP’s strategic WMS platform
Flexibilityto enhance
Direct warehouse automation integration

Key Functional Differences
SAP WM is focused on providing support for enterprise-centric processes for warehouse and storage:
Internal movements and replenishment for storage bins
RF and voice-supported put away and picking
Optimized warehouse movements using task and resource management (TRM)
Stock management at storage bin level with batch management and shelf life expiration dates
Warehouse internal packing
Architecture
•Integrated
•Decentralised

Key Functional Differences (cont.)
SAP EWM is focused on combining product and service supply chain solutions in planning and execution, supporting:
High SKU and line item volumes
Very fast and slow moving items that are competing for the same space
Vast product differences (size, weight, serial numbers, etc.)
Complex order fulfilment processes
Detailed packing and shipping logistics
Integration of third-party logistics (3PL) services for outbound processes

Inbound Processing
ASN data receiving, validation, correction
Transportation unit mgmt.
Goods receipt
Putaway bin determination
Internal routing
Deconsolidation
Putaway
Returns/reverse logistics
Quality inspection
Advanced returns mgmt.
Outbound Processing
Order deployment
Route determination
Transportation unit mgmt.
Wave management
Picking bin determination
Warehouse order creation
Work assignment
Picking, packing, staging
Loading & goods issue
Kit-to-order
Direct outbound delivery
Production supply
Shipping Cockpit
Storage & Operations
Rearrangement
Slotting
Inventory counts/record accuracy
Replenishment
Freight order management
Scrapping
Kit-to stock
Transportation cross-docking
Pick from goods receipt/push deployment
Yard management
Stock-specific unit of measure
Task interleaving
Execution constraint mgmt.
Semi-system-guided work
Labor management
Labor Demand Planning
Opportunistic cross-docking
Merchandise dist. cross-docking
CROSS- PROCESSES
COREPROCESSES
Warehouse Monitor
Warehouse Cockpit
KPIs, Performance dashboard
Graphical warehouse layout
Dock Appointment Scheduling
Packaging specification
Cartonization
Batch management
Serial numbers
Catch weight
Multiple EAN
Material Flow System
RF/RFID enablement
Pick by Voice
eSOAenablement
Import/export integration
EH&S integration
Transp. integration (LES)
Direct integration with SAP TM
Enhanced ERP QM integration
Claims & Returns
Migration tools
Rapid deployment package
SUPPORTINGAREAS
EWM 5.0
EWM 5.1
EWM 7.0
EWM 7.01
EWM 7.02
EWM 9.0
EWM 9.1
Key Functional Differences (cont.)

Have You Ever Asked … ?
How do we increase warehouse productivity, maximizing the throughput?
How do we optimize the position of the products in the warehouse in order to reduce lead times?
How can I balance resource utilization in the warehouse according to the demand?
How can we include new customer requirements in the processes in a very short time?
How can I increase the visibility of the processes on-going in the warehouse?
How do we better manage value-added services in the distribution processes?

Informed WMS Platform Selection
ERP-WM EERRPP WM++TTRRM SCM-EWM
WMS
Selection
Business
Requirements
Integration
Costs
Functionality
& Usability
Strategy
X SAP has no further development roadmap for
SAP WM or TRM

Informed WMS Platform Selection (cont.)
How can you check which is right for you?
Speak to SAP
Speak to a specialist partner
See SAP EWM in action for yourself
Get a Cloud EWM sandpit to give it a try
Get an instant comparison personalisedto your requirements
www.whichsapwms.com/

Example Platform Requirements
Not required15%
Future5%
Desired25%
Required55%
Not required
Future
Desired
Required

Example High Level Outcome
Based on the requirements:
SAP WM is 63% compatible
SAP EWM is 96% compatible

Past Challenges That We Have Heard
Implementation/consultancy is expensive
Secondary to some other WMS solutions
A simple warehouse doesn’t need that much functionality
Solution is still maturing
EWM can have performance issues
Not enough reference sites
Lack of integration with other SAP modules
Are these reasons still valid?

Licensing Costs
EWM licensing model is different from WM
Based on number of delivery items
EWM user licenses still need to be purchased
Delivery Items per day
Cost
1-5,000
€
5,001-10,000
€€
10,001-15,000
€€€
The EWM license is all in –so you get MFS and Dock Appointment scheduling as standard

Are They Still Valid?
Licensing
Small cost in the overall project cost
Investing in the roadmap and the functionality
Less dependency on custom development
•Reduce the cost of development and TCO
Implementation/consultancy
Specialist skills required to translate requirements into system
•How you can help:
–Understand the solution; does EWM fit your requirements?
–Ensure your processes are clearly defined and mapped
–Where possible, remove custom functions/developments
–Understand the gap fit, what will need to be developed

Are They Still Valid? (cont.)
EWM Integration
Standard integration can bring increased benefit and simplicity, as well as reducing TCO
EWM
TM
AFS
QM
EM
Retail
MFS

Are They Still Valid? (cont.)
Maturity, performance, references
Now into the 9th year of operation
EWM 9.1 is the 7th release of the software
500 sites are live with EWM and the solution is now being used across 24 industries and in more than 20 countries
•Over 230 active customers at end of 2013
EWM is now considered a best of breed WMS

What Does the WMS Market Tell Us?
A report by ARC Advisory Group in August 2013 evaluates market share of vendors by geography, segment, category, and tier:
SAP is number one in the WMS software market segment
SAP EWM’s market share has experienced tremendous growth
•Showing significant increase from 2009 to 2012
SAP is number three in market share in the overall WMS market
SAP is number one in overall market share in Latin America and number two in Asia
•The regions forecast to be the fastest growing in 2012-2017

What Is Happening in the Global Supply Chain?
Supply chains have changed during the WM timeline
Companies require faster and more detailed analytics
Multi-modal customer fulfillment (e-commerce/wholesale)
Reacting quicker to market/location shifts
Acquisitions
Increasing number offering 3PL service from own facility
Complex material handling requirement
Integration with other modules
•Transportation Management
•Event Management
Compliance and regulatory requirements are increasing

Integrated Supply Chains
What is an integrated Supply Chain?
Integrated planning, orchestration, execution, and tracking of the physical movement of goods
Warehouse
Vendor
Freight Forwarder
Import/ Export Customs
Customer
Carriers

SAP and the Supply Chain
SAP Supply Chain Execution Platform Strategy
Synchronized solution delivery
SCE Suite in one instance
Out-of-the-box SCE integration
Is WM aligned to this strategy?

Why Do Companies Buy SAP EWM?
Building a new DC
Building/commissioning a new large warehouse
Logistics cost reduction
Seeking to reduce logistics costs and inventory and improve customer service
Flexibility and optimization
Large complex warehouse operations with varied materials flows (i.e., cross-docking) and need to optimize resources and tasks
Reducing TCO and complexity of bespoke WM system
DCs with complex requirements on WM typically have high degree of customization

Why Do Companies Buy SAP EWM? (cont.)
Speed
Using mechanical handling equipment and automation in the warehouse, i.e., integrate Material Flow System (MFS) for automated storage and retrieval, voice picking, pick-to-light, etc.
Integration
Need to integrate these to automation systems, transport, and order management systems
Best practice
To establish best practice and to drive continuous improvement

Industry —Chilled FMCG Distribution: Case Study
New build distribution center providing single warehouse system for own brand and three separate 3PL customers
Looking for following benefits:
•Reduction in process complexity and standardization of functionality
•Simplified technical landscape and TCO
•Improved customer service levels
•Integration with automation systems
•Improved operational performance through enhanced technology
Find out more in “Case study: How Arla Foods enabled quicker and easier logistics execution with SAP EWM”

•Reduced need for bespoke development
•EWM Post-Processing Framework
•EWM RF Framework
Bespoke Development
•Flexible process enhancements through Business Add-Ins
•Enhancement while retaining standard core process with minimal development and low TCO impact
Enhance SAP Process (BAdI)
•Significantly improved process configuration options
•Very flexible warehouse processes
•Improved standard reporting
Configure SAPProcess
Standardizing a Highly Customized WM Solution

Industry —Retail Distribution: Case Study
Company-owned distribution center with integration to four non-SAP ERP systems. Solution providing single warehouse system for four different retail businesses.
•Flexible warehouse processes
•Visibility of warehouse activity
•Better management information
•Improved usability for multi-party stock management
•Improved operational performance
•Improved utilization of resources

Technical Flexibility
Implementation Flexibility
Process Flexibility
Enhancement Flexibility
•Extending strategies
•Enhanced replenishment
•UoM by business
•P&D optimisation
•Verification rules
•Process variation by business
•Process variation by customer
•Process variation by storage area
•Multi-ERP integration
•Extending interfaces
•Tailoring warehouse RF experience
•Multiple stock owners
•Configurable reporting
•End-to-end business process automation
Key Success Factor —EWM Flexibility

Industry —High-Tech Manufacturing: Case Study
High-tech manufacturer and distributor with government regulatory requirement to provide serial number traceability through supply chain
•Bin level serial number traceability
•Reduction in process complexity and standardization of functionality
•Improved efficiency and accuracy
•Improved visibility of movements between facilities
•Reduction in off-system processes
•Standardization of the data capture process

Standard Functionality to Drive Compliance
End-to-end traceability
Compliance
Optimisation
EWM
Manufacturing
Traceability
Regulation
Customer requirements
Mobile Processes

Industry —Consumer Product Delivery: Case Study
Highly automated operation with voice operations looking to implement EWM into new sites and a migration of WM to EWM
•Strategic investment for several new sites
•Simplification and cost reduction of automation integration
•Removal of technology constraints of external automation control
•Improved processes
•Expanded use of voice

Simplifying the Landscape and Reducing TCO
WM
Voice Server
Automation Integration
RF Server
EWM
Integrated Voice
Integrated Automation Control
Integrated
RF

Industry —Specialist 3PL: Case Study
Non-SAP customer looking to implement best of breed WMS to support warehouse operations in multiple facilities
•Reduction in manual and paper processes
•Clear and defined audit traceability for all movements
•Improved management of multiple owners of stock
•Delivery of customer-specific requirements regarding own stock handling
•Automation of complex material handling processes

EWM Fits, But …
32 Warehouses
High License Cost
Insufficient ROI
EWM
Multi-party stock ownership
Reduce Manual Processes
Traceability
Customer requirements
Process automation

Industry —3PL Logistics: Case Study
Implementing a dedicated IT infrastructure to take advantage of their shared distribution network
•Increased labourcost savings
•Standardized operating procedures across sites
•Management of multi-owner stock model
•Process mobilization
•Better management information
•Platform for business growth

If You Could Turn Back Time …

Where to Find More Information
SAP EWM:
www.sap.com/uk/solution/lob/scm/software/extended- warehouse-management/index.html
SAP EWM Help
http://help.sap.com/ewm91(for up to release 9.1)
SAP WM Help
http://help.sap.com/erp2005_ehp_07/helpdata/en/cb/973735ec50d33de10000009b38f889/frameset.htm
SAP WM or EWM for you?
http://scn.sap.com/docs/DOC-33136
www.whichsapwms.com

7 Key Points to Take Home
SAP EWM is not a replacement for the SAP WM system and SAP WM remains a viable alternative for many warehouses.
WM is not being developed any further by SAP; EWM is the strategic and ongoing development platform.
EWM is not right for all warehouses, but take the time to evaluate your WMS requirements to make a confident and informed choice.
Supply chains are changing; your WMS needs to be able to support your future business growth.
EWM has out-of-the-box, best-of-breed functionality with standard integration to other business-critical modules.
Be sure to consider TCO and total benefit, not just licensing and implementation costs in isolation.
The question is no longer why EWM, it is now why not EWM?

Questions & Further Information
Questions please?
www.rocket-consulting.com
Supply Chain Innovation Team
•Q&A forums
•Webinars
•Roundtable discussions
•Thought Leadership
•Technology
•Trends
Rocket Consulting Online
•www.rocket-consulting.com
•Case studies
•News & Events
•SAP Add-ons and accelerators
•Twitter: @rocket_sap
•LinkedIn showcase pages

www.rocket-consulting.com

SAP Warehouse Management (SAP WM) or SAP Extended Warehouse Management (SAP EWM) 2014

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