sce summit ewm cat logistics.ppt - sapfm.sap.com/data/upload/files/cat logistics on extended...
TRANSCRIPT
The Challenge:
Cat Logistics wanted to make a bold move:
• Dramatic returns required a bold move
• Incremental growth not acceptable
• Internal development was becoming a costly alternative
• Desire to stay ahead of technology changes
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Committed to Customer Success
In 2002 Steve Wunning, President, Caterpillar Logistics Services:
“We believe that we can do more. By integrating supply chain activities with a comprehensive IT solution, we can reduce development costs 40%, implementation costs 30%, and ongoing operations 20%, all while shortening
start-up durations. The net effect will benefit both the bottom line and the end customer.”
Approach Alternatives• Upgrade existing / develop new systems
• Lacks true integration
• Incremental improvements, incremental benefits
• Increased capital expense, longer development cycles
• Purchase off the shelf solutions and adapt• Lower investment
• Improved integration
• Large providers historically underfunded SPM functionality
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Committed to Customer Success
• Large providers historically underfunded SPM functionality
• No commercially available off the shelf solutions that met the current and future requirements
• Change the rules: a new approach• Cooperative approach to share development costs
• Input to new commercial software vs. adapting what was available
• Leverage similarities in requirements
Service Parts Solution
� Intellectual Property
� Know-how
� Capability
� Scalability
Service Parts Logistics Software Alliance
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Committed to Customer Success
BestBest--InIn--ClassClass Logistics Performance for Customer Satisfaction and Cost
Concept:� ~ 80% common processes/ technology
� Leverage Ford and Cat Logistics volumes
� Commercialize system software
� Exit development
� Become implementers and integrators (Cat
Logistics)
� Intellectual Property
� Know-how
� Capability
� Scalability
Strategy: Fully Integrated Solution
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Best-In-Class Logistics Performance
Increased Customer Satisfaction
Dramatic Cost Reduction
The Result:The Result:
State of the Art Service Parts
Management Solution Across Multiple
Industries
Benefits:� Lower development costs
� International capabilities
� Natural (planned) technology upgrade path
� Increase 3PL market opportunities (Cat
Logistics)
� Shared Risks between Cat Logistics, Ford, and
SAP
Delivering Enterprise Value Through Supply Chain Excellence
Cat Distribution Services Manufacturing Logistics
PIRACICABAJOHANNESBURG
MELBOURNE
SINGAPORE
� GRIMBERGEN � MORTON
MOSCOW
SHANGHAI
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Transportation External Client Business
Cat Logistics Today
EAME (Europe, Africa, Middle East & CIS)Americas
Asia-Pacific
6 Continents 23 Countries
20 Languages108 Facilities & Offices
Shipping to 190+ Countries 11,900+ Employees
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11,900+ Employees29M+ Sq. Ft.
160M+ Orders/Yr21B lbs. Of Freight/Yr
$2.4B Transportation Purchased/Yr20M SKU’s Serviced/Yr
616200
LocationsEmployees
334,450
LocationsEmployees
121250
LocationsEmployees
Committed to Customer Success
Why SAP?
• Global Capability & Focus on the Customer Needs
• Committed to the Ford-Cat Alliance Vision of Industry Leading Service Parts
Logistics Solution
• Modular Development and State-Of-The-Art Technology Now and Into the Future
• Commitment to the SPM space
• Best “fit” of existing SPM offerings
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• Industry strength, financial strength and proven expertise
• Development capability
SAP is Caterpillar’s SPM strategic direction – for internal use as well
as for external clients.
80%Unique
Solutions
Aligning Our Strategy
5%
Client
Unique
15%
Industry
Specific
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80% Standard Solution
20%Std.
Solution
Current Future
80%Unique
Solutions
Aligning Our Strategy
5%
Client
Unique
15%
Industry
Specific
Standard Solution is based on
Common Processes
utilized
Globally
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80% Standard Solution
20%Std.
Solution
Current Future
Globally
• Definition: A configured SAP system, incorporating common, standardized processes and data definitions that can be rolled out to
multiple locations
– Target 80 / 20% global vs. local
– Common business processes
Aligning Our Strategy – Global Template
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– Common business processes
– Reduced implementation risk
– Quick repeatable roll-outs
– Lower implementation costs
• Change Management is crucial (awareness at all levels)
• Transformational thoughts and actions required early
• Fully understand current process and rational
• Team willing to accept and advocate change
• Follow your Methodology & Implementation Processes
• Leverage standard functionality
Aligning Our Strategy - Lessons Learned
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• Enhance for strategic advantage
• Do not over engineer your enhancements
• Master Data
• Repeatable Templates for everything
• Stay current with SAP service packs
Committed to Customer Success
Time
CO
MP
ON
ET
S
UPGRADES/SP
EWM
MM CRM
End Goal
TM?
Aligning Our Strategy - Implement , Evolve, Rollout
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CO
MP
ON
ET
S
GLOBAL
CAT LOGISTICS
LANDSCAPE
PRODUCT EVOLUTION
SAP R&D – New EWM Functionalities
ROLL - OUTS
ProductionSupport
Global COE
End Goal
METHODS
Implementation Approach
• Continued Investment in Global Template
• Continued Global Business Process Transformation
• Component Installation Approach
– Facility by Facility Go-Live• SCM Extended Warehouse Management
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• SCM Extended Warehouse Management
– Worldwide Network Install of Component• SCM Service Parts Planning
– Regional Go-Live• CRM & Billing
Committed to Customer Success
Current Progress
• EWM– Pilot Facility (St. Paul, MN) installed in November 2007
– Waco Distribution Center installed March 2009
– Clayton DC scheduled for early 2011, IPC 3rd QTR 2011
– MEDC scheduled for 2012
• SCM Service Parts Planning– DFIP installed in June 2009
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– DFIP installed in June 2009
– DRPR scheduled for mid year 2011
• CRM– CRM active through interfaces
– BCR MEDC scheduled for 2012 (1st & regional)
Committed to Customer Success
EWM Highlights
Increased Process Functionality
• Inbound Processes
• Outbound Processes
• Internal Processes
Key Benefits:
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Key Benefits:
• Integrated Yard Management Solution
• System Directed Routing
• Exception Driven Processing
• Pick Bin Determination
• Packaging Execution
SAP ERP-WM vs. SCM-EWM
TransportationTransportation
WarehousingWarehousing
Vis
ibil
ity
Vis
ibil
ity
An
aly
tics
An
aly
tics
CoreOperations
CoreOperations
Transportation
Warehousing
Vis
ibil
ity
An
aly
tics
CoreOperations
EWM offers …
� Monitor as central tool and central starting point
� Use of partial goods receipt in inbound processing (GR per HU)
� System guided put away with deconsolidation/fanning
� Complex wave planning and outbound route structure
� High volume picking and shipping and Warehouse Order Creation
� Broad stock/inventory view (pre-picked HUs, staging zones, etc.)
� Slotting & Better integration to Yard Management Functionality
� Warehouse Rearrangement – and Goods Receipt Optimization
� BI Integration
� Conveyor automation and pick-to-light integration
Pallet managed inventories using Handling Units
Put-away Strategies
Removal Strategies
Wave Management – pick-logig
Replenishment
Handling / Storage Unit Management
Yard Management
Enhanced configurable RF-technology
Task & Ressource Management
Expected goods receipt
Value Added Services / Kitting
LES EWM
Internal Routing
Distribution Center
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Committed to Customer Success
� Pallet managed inventories using Handling Units
� ePedigree/serialization with RFID integration
� Integrated labor management functionality
� EWM simplifies HUs by only defining them at Storage type level, instead of Storage Location level
� Shipment and Transportation units fully supported
� Each, case and bulk picks
� Replenishment of forward picking areas
� Double-checking inspection and packing
� Process-oriented storage control
� Assignment of Serial Number to HU possible
Cross-Docking
Dynamic cycle counting
Unloading of transport units
Deconsolidation
Slotting / Rearrangement
Labor Management
Multi Client Warehousing
Flexible Process Modelling
Layout Modelling
Warehouse Automation (MFS)
Decentral Quality Inspection
INBOUND
• Slotting
• Receive ASN Data
• ASN Validation & Correction
• Transport Unit Arrival
• Manage Transport Unit
• Goods Receipt
• Base Receiving
• Putaway Bin Determination
INTERNAL WH
• Yard Management
• Quality Inspection Engine
• Inventory Counts /
Records Accuracy
• Kitting (to Stock/ to Order)
• Replenishment
• Rearrangement
GREEN – Implemented in production
BLUE – Current implementation
YELLOW – Not yet implemented EWM Available Functionality
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• Putaway Bin Determination
• Unload Transport Unit
• Deconsolidation
• Internal Routing
• Putaway
• Inbound Back Order Expediting
• Push Deployment
• Transportation X-Dock
• Returns / Reverse Logistics
• Packaging Engineering
• Rearrangement
OUTBOUND
• Route Determination
• Wave Management
• Picking Bin Determination
• Warehouse Orders
• Work Assignment (labor mgt)
• Picking
• Packing
• Shipping / Staging
• Loading & Goods Issue
EWM Pilot - St. Paul, MN (Brownfield)
Facility Info:
• 90,000 sq ft. 600 inbound lines/1,200 outbound lines
• Emergency customer facing for North Central US and Central Canada
• Ship to Customers around the world
Testing:
• Integration - ~300 tests, 16 weeks
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Committed to Customer Success
• Integration - ~300 tests, 16 weeks
• UAT - ~200 tests, 8 weeks
Go-Live:
• 1-2 IT people on-site the first 2 months & Command Center Concept
Challenges & Lessons Learned – St. Paul
Performance Issues:
• SCM 5.0 Service Pack 8
• Custom and CDP code
• Data archiving and database reorgs
• RF dead spots, access point failure
Lessons:
• Make sure to test using Production (real life) sized volumes.
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• Make sure to test using Production (real life) sized volumes.
• Do not push the work into the next milestone. It creates a snowball effect.
• Global Template works. It takes some work to get agreement from all parties on standard practices. But it is worth it.
• SAP is willing to help. When you log OSS messages include all relevant information and example data.
• BCSets work well to transfer configuration and lock down settings when needed.
Committed to Customer Success
1st DC – Waco, TX (Greenfield)Facility Info:
• 750,000 sq ft. 2,500 inbound lines/9,500 outbound lines
• Emergency & Stock for customer facing dealers plus network search
• ~200 associates / 3 shifts over 100,000 parts numbers stocked
• Ship to Customers around the world
Testing:
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Committed to Customer Success
Testing:
• Integration - ~350 tests, 9 weeks (Regression & FRICE)
• Business Simulation – volume & number of users, 6 weeks (Auto)
• UAT - ~400 tests, 6 weeks (Blended solution-more business scenarios)
Go-Live: (phased approach)
• 2-4 IT people on-site the first 2 months & Command Center Concept
Challenges & Lessons Learned – Waco
General Warehousing Issues:
• Some RF process and performance
• Few storage concepts
• PGI performance and common process
• Transportation cross dock process flow
Lessons:
• Strong SAP support for product and challenges
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• Strong SAP support for product and challenges
• Scope Control – PTAM process
• Leverage auto testing tools for regression testing - Velocity
• Methodology Adherence – High Quality Delivery
• Global Template grows as new functionality is implemented. Impact Analysis on existing facilities.
Committed to Customer Success
Continued Investment in Global Template
• Additions to Caterpillar Global Template for Waco implementation
– Transportation Cross Dock functionality
– Multiple RF Screen sizes
– STO shipping and receiving
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– STO shipping and receiving
– ITS (Internet Transaction Server) RF Screens
DC & IPC – Clayton, OH (Greenfield)Facility Info:
• ~1.5M sq ft. ~3,100 inbound lines/~18,300 outbound lines
• Emergency & Stock for customer facing dealers plus network search
• ~500 associates / 3 shifts ~200,000 parts numbers stocked
• Ship to Customers around the world
Testing: (Impacts of BP)
• Integration – DC ~115 tests, 12 weeks (completed in 8 weeks)
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Committed to Customer Success
• *Integration – IPC ~775 tests, ~16 weeks
• Business Simulation – volume & number of users, 4-6 weeks (Auto)
• UAT - ~175 tests, 16 weeks
• *UAT - ~ 1100 tests, 20 weeks (script writing in process)
Go-Live: (phased approach)
• 2-4 IT people on-site the first 2 months & Command Center Concept
* = new process
Current Status & Lessons to Follow – Clayton
Current Status DC & IPC:
• DC – UAT IPC – Integration Test
• Focusing on New functionality/process testing and Business Simulation Testing
• Growing Auto Testing capabilities and UAT Realistic Production scenarios
Lessons:
• Strong SAP support for product and challenges around new functionality
• Leverage SAP Max Attention services
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• Leverage SAP Max Attention services
• Scope Control – PTAM process
• Leverage auto testing tools for regression testing - Velocity
• Methodology Adherence – High Quality Delivery
• GT grows as new functionality is implemented. Impact Analysis on existing facilities. Scheduled tuning and review of solution execution.
• Leverage and grow Global team for continued implementation and support
Committed to Customer Success
• Additions to Caterpillar Global Template for Clayton DC & IPC
– EH&S
– Custom Table Archiving
– Extended Cross Docking
Continued Investment in Global Template
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– Extended Cross Docking
– Base Receiving
– VAS & Pack Specs
– QIE/QM – Scrap improvement
– GL & FI integration
– Slotting improvements
– Auto triggers for IPC PGI/Load/GR
What’s Next• MEDC Project beginning (EWM & BCR)
• Execution Framework – Rollouts & Releases
– Rollouts - EWM Brownfield, Greenfield & Retrofits
– Releases – EWM Brownfield, Greenfield, New Functionality, SP/EP, SCM modules
• EWM Functonality
– Voice Technology
– Labor Management
– Kitting
– Supply Chain reporting extensions
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• Extension of SCM products and integration
– BCR North America, Asia Pacific, Latin America
– GATP
– Push/Pull Deployment
– Order Management
– Regional implementations
– Additional SPP functionality
Committed to Customer Success
Questions
Thank You!
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Questions
Committed to Customer Success
Back-up Slides
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Back-up Slides
Customer Relationship Management Supply Chain Management
SAP SCM 7.0
SAP APO SAP ICH
Service Parts Planning
SAP Extended Warehouse Management
globalATP
Service Parts Management: Architecture (2010)
SAP Event Management
SAP Internet Pricing Configurator
CRM Server: Sales, Service, Billing,
Marketing andInteraction Center
CRM Middleware
SAP Global Trade Service 7.2
ComplianceManagement
CustomsManagement
SAP Transportation Management System
SAP CRM 7.0
RFC* XI
SAP SCM Basis
Master Data Transactional Data
SAP NetWeaver 7.01
Business WarehousePortal Exchange Infrastructure
RFC* XI
CRM MiddlewareRFC*
ECC 6.0 (EP 3)
Materials Management
Quality Management
Logistics Execution
Financials/Controlling
Web Application Server
Environment, Health and Safety
Management Management
PlugIn 2005
* tRFC, qRFC or RFC
Application Architecture: Warehouse Management
EWM
WMEExecution using RF Exception
Management
WM Service
Front-end Application
InboundPlanning
Outbound Planning
Monitoring
ERPERP
Transactional Data
(I/O Orders, Execution Orders,
Delivery...)
KPIs
(BW)
Master Data /
Parameter
Cross Docking Wave Planning Slotting
Picking Strategies Putaway StrategiesPacking / Packaging
Lean Inventory
Management
APO