SAP S/4HANA Logistics

Tackling the challenges in a modern supply chain

The modern supply chain faces many challenges. Customers are demanding more individualised products, in a shorter lead-time, with delivery to many different places. The digitization of the supply chain is the right solution to remove the challenges. The SAP S/4HANA Digital Core is the central application that allows for the digitization of the supply chain.

The modern supply chain is responsive and agile, which are sources of additional costs. At the same time, most supply chain managers have to contain the costs and preserve profit margins. In addition companies need to anticipate market demand accurately, and keep pace with changes in demand patterns. Furthermore, supply chain managers have to deal with the uncertainty on the quality of products and efficiency of the logistics operations. And finally, changes in regulations and trading relations between countries are clearly a difficulty for cross-border supply chains.

The digitisation of logistics processes is the key solution to the challenges for a modern supply chain: 3D printing, augmented reality and pick-by-voice are a few examples of ways to make logistics more efficient and reliable.

In order to make appropriate decisions, managers need real-time information and tools to analyse or simulate the consequences of a decision. Moreover, advanced planning tools, and applications that manage the transfer of ownership, assist the decision-making process and make the supply chain more resilient.

These are the required attributes of the information system.

How Deloitte can help: Embracing the Exponential Supply Chain

At the heart of the supply chain is an information system that gathers and analyses data, and makes it available to all relevant parties. If the pulse of the ERP system cannot respond rapidly , it will be unable to sustain relationships between parties in the supply chain, and operational problems that arise will not be resolved quickly enough.  

Given all the challenges previously mentioned the modern supply chain faces huge volume of data to analyse. Under such constraints ‘standard’ ERP systems fail to manage the information from across the enterprise in real time.

That is where SAP S/4HANA makes a difference. It can handle large volumes of data, making processes more efficient, including real-time insights. It supports mobility and naturally integrates the adjacent technologies required by the digitization of the logistics processes.

SAP S/4HANA includes new key applications to improve the supply chain dramatically. These modules and others are included in the Deloitte Exponential Supply Chain (DESC), powered by SAP S/4HANA® Enterprise Management. DESC is an SAP®-certified BAiO solution that provides a set of preconfigured business scenarios that can help your organization develop a vision and evolve fast to meet new business demands. DESC can show you the “art of the possible” for leveraging SAP S/4HANA supply chain functions.

Supply Chain Planning with SAP IBP

The digital core, built on SAP S/4HANA enables the smooth integration of SAP cloud-based systems like SAP Integrated Business Planning for Supply Chain (SAP IBP). SAP IBP delivers the primary input for planning activities in SAP S/4HANA.

Both systems are connected through SAP Cloud Platform Integration for data services, a cloud and on-premise solution for data integration between SAP S/4HANA and other SAP cloud-based systems.

SAP IBP consists of several modules to enable supply chain planning in real-time, namely SAP IBP for demand, SAP IBP for supply, SAP IBP for inventory, SAP IBP for demand-driven replenishment and SAP Supply Chain Control Tower, a powerful tool for your supply chain analytics.

Planning: MRP Live, demand-driven, detailed scheduling

Thanks to better performance, the MRP Live application operates in real time and has a simulation facility. This provides more efficient Material Requirement Planning (MRP) than the former SAP ERP, with its problems around long-running jobs and daily or weekly information cycles. In addition, the planning function includes new features such as the demand-driven replenishment application. Finally, after the MRP run, the advanced scheduling allows for computing a finite plan.

Advanced ATP

The Available-to-Promise (ATP) function compares the availability of stock and incoming supplies with the portfolio of customers’ orders in order to propose a delivery date. The Advanced ATP module introduces a new design for back-order processing based on the Win-Gain-Lose concept, where orders awaiting confirmation will be sorted by priorities, with frequent reviews of the numbers and rapid adaptation to new priorities.

Extended Warehouse Management (EWM)

The traditional SAP ERP Warehouse Management application will be phased out, and replaced by a simplified module of SAP EWM. The inclusion of EWM within the SAP S/4HANA will significantly improve its functionalities. EWM in SAP S/4HANA is embedded completely in the core ERP, without the need for any interface.

SAP S/4HANA entering a new digital world with material resource planning

Jump-start your project with the Logistics Lab

In addition to the technical migration of the ERP to SAP S/4HANA, there must be a transformation in several key processes. This transformation is a lengthy exercise, and often the question is: ‘How do we get started’? The Deloitte’s answer is our Greenhouse Lab concept. The Deloitte Logistics Lab is the adaptation of the Greenhouse Lab concept that offers an immersive experience designed to jump-start your ability to tackle the business problems with introducing SAP S/4HANA Logistics.

The Greenhouse Lab approach is based on the Design Thinking concept. Design Thinking is a problem-solving technique based on generating ideas, experimentation, and focus on human-centered issues. The typical target of a Lab session is to explore a specific challenge and identify an approach to dealing with it. 

Realising your project with Deloitte

Client Case Study I: Migrating data in a greenfield installation of SAP S/4HANA

The SAP S/4 HANA Migration Cockpit is the SAP tool of choice for a greenfield implementation of the system. For a fresh installation of SAP S/4HANA system, the tool enables the migration of selected master data and transactional data from a SAP or non-SAP system.

SAP has revised the way to load data into S/4 HANA and come up with a modern and easy to use migration tool that offers the following benefits:

  • Save time with a ready-to-use solution
  • Reduce migration costs and effort by avoiding the need for programming
  • Maintain high data quality and consistency due to automated mapping
  • Achieve an easier, safer migration with step-by-step guidance during the migration process
  • Predefined content, in the form of migration objects, to identify and transfer the relevant data
  • Templates and mapping for each migration object
  • Flexibility to integrate custom data by tailoring migration objects to meet requirements

Deloitte Migration Services have experience and expertise in global S/4HANA implementations and in managing complex data migrations in many industries. Deloitte provides: data migration expertise; a proven methodology and business process, and industry best practice; and templates and accelerators required for a successful migration, with a complete, on-time and on-budget Go-Live. The migration approach is standardised and extensively automated. Relevant information is continually throughout the process, to support the migration.

Deloitte will collaborate with your project team to:

  • Evaluate your existing data, your current processes, and your future processes in an SAP S/4HANA environment to determine the impact across business areas
  • Assess the quality and completeness of your existing data, and identify and eliminate duplicate data
  • Ensure that your data meets SAP S/4HANA requirements
  • Develop your data migration strategy to ensure a smooth and efficient transition to deliver the value you expect.

Client case study II: Getting ready for the digitisation challenge

Extended supply chains must keep pace with changes in the digital economy. Industry 4.0 innovations, the Internet of Things, advanced robotics, supply chain analytics and big data are the new differentiators of the global economy. Deloitte offers you strategic guidance specific to your business based on leading practices. Supported by an extensive repository of industry solutions Deloitte helps your team in defining and prototyping the intended end stage for your company.

Digital Core Transformation underpinned by S/4HANA Enterprise Management

Client cases study III: Cold Chain

Adjacent technologies extend the reach of core processes and enable new ones. Cold Chain is an example of the power of combining adjacent technologies, in this case the Internet-of-Things and blockchain technologies, with core ERP processes.

The Cold Chain solution developed by Deloitte enables real-time monitoring of goods by recording critical environmental information during their transit. Sensors collect real-time information about the goods, which is transferred to a cloud application for monitoring and analysis.

Cold Chain can inform in real time about urgent problems with goods in transit, such as breaches of a temperature, humidity, acceleration, or barometric pressure safety threshold, enabling the company to react instantly.

The power of adjacent technologies is only entirely realised if the collected data can be integrated into company’s ERP systems. Integrating the signals provided by the sensors into the core logistics IT system allows for rapid responses. The end-to-end integration of the information at the heart of the command and control of the company’s processes prevent damage to goods, a reduction in goods inspections, and a reduction in the costs of returns from customers.

A next-generation approach to protect goods in transit

Contact our expert

Beniamino Matriciani

Beniamino Matriciani


Ben is a Partner in Deloitte’s global SAP practice. Ben helps clients to leverage and combine best practices, technologies and solutions to thrive in today’s complex business environment. He has a suc... More