1. The Value of the SAP S/4HANA® Supply Chain Solution Transforming supply chain in the digital economy
Accounting and Financial Close
Treasury and Financial Risk management
Response and supply
Management
Business planning
Logistics
Demand Sensing and Integrated Business planning
Orchestrate response to changes in supply and demand
Optimize logistics across complex networks
Real-time order management platform for Omni channel demand management
Real-time demand visibility, with analytics across all data held in SAP, covering demand, supply and finance, integrated to IBP (Integrated Business Planning) Demand for demand sensing **
Collaborative Integrated Business planning, integrating S/4 HANA data with SAP IBP for sales and operations**
Replenishment to optimized targets and buffer stock locations, calculated using advanced multi echelon inventory optimization algorithms in IBP for Inventory leading to reduced working capital / Inventory**
Advanced ATP (Available to Promise) to manage prioritized demands across multiple channels; to maintain allocation plans and enable real time allocation order promising constraints
Improved user productivity with SAP Fiori apps including: back-order processing rules setup and result monitor and to manage last-minute changes a ‘release for delivery’ re-scheduling app.
SAP Fiori® apps for MRP (cockpit) providing real-time insights into material availability and exceptions with enhanced decision support for user productivity
‘Live’ MRP (Materials Requirement Planning) to provide unconstrained and constrained supply plans in minutes
Advanced constrained production planning and detailed scheduling capabilities within SAP S/4HANA
Live inventory management through redesigned data model enabling scale, speed and reducing batch updates, with enhanced UI for user productivity
Manage lowest level of granularity in inventory stock keeping – “Lot size of one”
Material ledger to simplify advanced material costing with multiple valuation methods and integration to financials
Single warehousing platform for all warehouse operations, both basic and advanced - enabled by SAP EWM ( Extended Warehouse Management) embedded in the SAP S/4HANA core
The SAP Transportation Management (SAP TM) application integrated with SAP S/4HANA, supporting distribution and logistics holistically**
Business Planning
Provides a real-time order management platform for omni channel demand management. Changes in demand are visible without waiting for lengthy batch processes. Orders are prioritized and tightly integrated with supply and fulfillment
Short-term demand prediction with demand sensing algorithms and forecasts for medium to long-term demand with advanced statistical forecasting methods (SAP Integrated Business Planning)**
Rapid and collaborative S&OP, including “what if” and scenario planning of different potential business plans, to allow business stakeholders and functional leaders to agree on and execute desired path forward (SAP Integrated Business Planning)**
Determination of optimal inventory targets across multiple echelons of raw material, work in process, and finished goods inventory, enabling supply chain to operate with less working capital while maintaining target service levels (SAP Integrated Business Planning)**
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Response and Supply
Mass product availability check for sales, planned, and production orders. Advanced ATP check and performance improvements for releasing large production orders
Back-order processing with intuitive selection and ranking of demand to establish order priorities. Rescheduling order confirmations interactively to manage variability through out the day.
(Live) MRP: one single harmonized MRP process for all materials, both unconstrained and those requiring advanced constraint-based planning
SAP Fiori apps for MRP (cockpit) provide real-time insights into material availability and offer work flow support to resolve issues; also help planners build vehicle loads before releasing requirements to procurement
Advanced production planning and detailed scheduling capabilities in SAP S/4HANA with harmonized master data and user interfaces in SAP Fiori
Logistics
Live inventory management through redesigned data model enables unlimited simultaneous material movements and allows for true transparency on inventory and material flows
Ability to change lot size to “one,” thus capturing the lowest level of granularity in inventory stock keeping
Material ledger available as a default option. All inventory valuation data exists in material ledger, removing redundancies and aggregates
Faster actual costing due to optimized code based on SAP HANA; faster reporting as needed for actual costing; multiple currency and multiple valuation methods
Embedded EWM for advanced warehousing operations, including optimization, automation, and labor management
One system (master data, customizing, and UX) for reduced data redundancy, lean processes with fewer business documents, and overall simplification
The SAP Transportation Management (SAP TM) application integrated with SAP S/4HANA, supporting distribution and logistics holistically
10–12% reduction in days in inventory*
10–15% reduction in revenue loss due to stock-outs*
10–12% reduction in total logistics cost*
*Benefits are based on early adopters of SAP S/4HANA® or conservative outside-in benefits due to moving from a traditional ERP to enhanced SAP S/4HANA + line-of-business (LoB) and cloud capabilities. As each enterprise is at a different level of maturity, our recommendation is to work with you to determine the value proposition for the enterprise.
**Capabilities that extend beyond SAP S/4HANA shipment to SAP’s broader cloud and LoB portfolio

2. SCENARIO: SUPPLY CHAIN EXAMPLE
SAP S/4HANA provides reengineered and simplified business processes that can yield significant benefits, transforming the execution from multistep, batch-driven processes with latency in terms of key performance indicators to real-time processes with actionable insights.
Respond with confidence with SAP S/4HANA for advanced ATP
Traditional ERP
Day in the life of a customer service manager:
Days are typically smooth until demand exceeds supply and critical decisions need to be made
Order Confirmation
Product Allocations
Multiple Backorder Processing Batch Jobs
Manual Rescheduling
Delivery commitments based on outdated data resulting in cancelled or delayed orders
Allocation check in a different system. Low priority orders fulfilled first, resulting in strategic customer orders unfulfilled
Overnight batch jobs, commitments not aligned with the business’s profitability
Difficult to address the last minute rescheduling by priority customers
SAP S/4HANA
Day in the life of a customer service manager:
Handles critical situations smoothly, balancing demand and supply and ensuring profitability
Online Order Confirmation
Rule-based Product Allocations
Single Backorder Processing Run
Release For Delivery App
Up-to-date inventory information resulting in realistic fulfillment commitments
Rule-based allocation check in one single system; needs of strategic customers always met
Real-time order confirmations. Advanced segmentation techniques driving business’s profitability
Interactive
rescheduling to adapt to last-minute changes in customer orders or supply

3. Customers Articulate the Value of SAP S/4HANA Supply Chain
Mangalam Cement Limited
Vectus Industries
Boryung
Reducing operational cost by 15% with SAP S/4HANA
Getting critical drugs to consumers more quickly with SAP S/4HANA
Getting critical drugs to consumers more quickly with SAP S/4HANA
Vectus Industries Limited is India’s leading and fastest growing pipe and water storage solution.
Vectus deployed the SAP S/4HANA Enterprise Management solution and started experiencing total ease in managing business operations.
It has decreased its days sales outstanding and can deliver accurate, instantaneous customer invoices. Vectus achieved a 15% reduction in operation costs, real-time year-end financial close (down from a few months), 50% faster access to and visibility of real-time data, and a 60% increase in operational efficiency.
Boryung Pharmaceutical Co., Ltd. manufactures and sells pharmaceutical products in South Korea. Boryung turned to the SAP S/4HANA Finance solution as a foundation for its transformation. It gained high visibility and control of its business information in real time.
Boryung achieved 17% higher on-time delivery performance, 15% fewer days in raw material inventory, and 4.5% higher operating margin for in-house manufacturing goods.
Mangalam Cement Limited (MCL) is an India-based cement manufacturing company. MCL decided to deploy the SAP S/4HANA Enterprise Management solution at four plants, two captive power plants, 13 windmills, two captive mines, and 55 distribution centers
MCL achieved online stock availability and production orders, better visibility of raw material consumption and goods-in-transit stocks and automated credit limit checks, PO processing, job orders, production orders, and railway freight calculation
Read the business transformation study >
Read the business transformation study >
Read the business transformation study >