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TRAINING

SAP TRANSPORTATION
MANAGEMENT 8.1
4: Forwarding Order Management

Objectives

At the end of this module, you will be able to:


Explain the Configuration Steps
Explain the Process Details

Agenda
Business
Process
Solution

Purpose and Requirements

Overview
Description

TM8.1 Forwarding Order


Business Purpose

Focus

on the business processes of freight


forwarders or Logistics Service Providers (LSP)
With SAP Transportation Management 8.0, the

foundation of a forwarding order management for freight


forwarders was established
TM 8.1 focuses now on the business processes of freight
forwarders or logistics service providers

TM8.1 Forwarding Order


Key Requirements

TM

8.1 focuses now on the business processes


of freight forwarders
The following key requirements have to be addressed
in the area of forwarding order management
Manual and Automatic capturing and processing of

forwarding orders
Enable capturing of standard fields that are usually part
of an order from the customer
Short cut processes in forwarding order management
Controlled / Uncontrolled Shipment process
Incoterm Handling

Agenda
Business

Purpose and Requirements

Process

Overview

Solution

Description

TM8.1 Forwarding Order


Scenario - 1

Freight Forwarders
Gateway (CFS)
(Yokohama, Japan)

Station
of Origin
Pickups

Shippers (OtaKu, Gifu,


Japan)

LineHaul /
Feeder

Port-ofLoading
(Yokohama
Japan)

Forwarding
House Station
(Nagoya, Tokyo)

Freight
Forwarders
Gateway (CFS)
(Los Angeles, USA)
Station
of Destination
Port-ofDestination
(Long Beach
USA)

LineHaul /
Feeder

Deliveries
Forwarding House
Station
(San Diego, Phoenix)

Consignee
s
(Sedona,Tus
con, USA)

TM8.1 Forwarding Order


Scenario - 2

TM8.1 Forwarding Order


Definition

Forwarding

Order is an order from an ordering


party to a logistics service provider to transport
goods from one or multiple customers/shippers
to one or multiple consignee
Contains the following Information

Goods to be transported
Packaging/Resource Information
Quantities
Locations and Date/Times
Business Partners
Incoterms
Dangerous Goods
Stages

TM8.1 Forwarding Quotation


Definition

Forwarding

Quotation is
an offer by the logistics
service provider to the
customer for the
transportation of goods

Receive Quotation
from LSP

Create quotation with


basic transportation
data
Perform
transportation charge
calculation
Optionally assign
validity period to
Quotation

Accept / Reject
Quotation

Communicate
quotation back to
Ordering Party

Place Order with


reference to
Quotation

Convert quotation into


Forwarding Order

TM8.1 Forwarding Order


Process Details
Customer
Service
Representative
Forwardin
g Order
Processin
g
Forwardin
g order
creation
System
based
complianc
e checks
Transporta
tion
charge
calculation
Forwardin
g order
confirmati
on sent to
the
shipper
House B/L
printing &

Ocean Freight
Booking
Specialist
Ocean Freight
Booking
Ocean
freight
prebooking
creation &
sending to
ocean
carrier
Internal
Schedule
and
Capacity
provisioni
ng
Automated
ocean
carrier
communic
ation
(updates,

Transportation
Manager
Order
Management

Consolidat
ion / DeConsol
Consol &
Master B/L
Mgmt
Freight
Orders
Document
prep &
printing
Automated
carrier
selection
Automated
Commn to
warehouse

Dispatcher
Transporta
tion
Execution
&
Monitoring

Transportation
Charge Clerks
Invoicing &
Settlement

Transporta
tion
execution
event
monitoring
(SAP EM)

Freight
settlement
document
creation &
transfer to
ERP

Incident
manageme
nt

Self-billing
(in the
name of
service
provider)

Resolution
with
customer
through
customer
service
rep.

Customer
Billing &
Settlemen
t
Forwardin
g
settlement
document
creation &
transfer to
ERP
Customer
invoice
creation
(SAP ERP)

Agenda
Business
Process

Purpose and Requirements

Overview

Solution

Description

TM8.1 Forwarding Order


Process Control Attributes

Certain

attributes are introduced in TM8.1 to


define the nature of the business documents
and control their processing

Transportation Mode
Traffic Direction
Shipping Type
Movement Type

TM8.1 Forwarding Order


Process Control Attributes Transportation Mode

Transportation

Mode specifies how cargo is to


be transported, for example, by road, rail, sea
or air
Usually defined on the business document header level

and specifies the transportation mode of the main


carriage

TM8.1 Forwarding Order


Process Control Attributes Traffic Direction

Traffic

Direction specifies whether the transport


of the cargo is an import (inbound) or an export
(outbound) transport from the perspective of
the contracted organizational unit

The traffic direction if maintained in the business


document type customizing is taken over into the
business document during creation and cannot be
changed anymore

TM8.1 Forwarding Order


Process Control Attributes Shipping Type

Shipping

Type specifies the way how the


planning and execution of the transport of the
cargo should be performed
Available shipping types (LCL, FCL) can only be
specified for transportation mode Sea

TM8.1 Forwarding Order


Process Control Attributes Movement Type

Movement

Type specifies for which stages the


freight forwarder is responsible to organize the
transport of the cargo and thereby defines
which stage types are valid for the business
document.
Door to Door - The freight forwarder needs to pick
up the goods from the shipper (source location) and to
deliver it to the consignee (destination location).

TM8.1 Forwarding Order


Process Control Attributes - UI

TM8.1 Forwarding Order


Controlled Shipment

Freight

forwarder
scenario 1
Pre-,
main- and oncarriage are all handled,
subcontracted
and
invoiced by the freight
forwarder

NVOCC
or Carrier
Freight
Settlement
Document

Ordering Forwarding
Order
Party

Forwarding
Agreement

Freight
Agreement
Freight
Booking

Forwarding
Settlement
Document

Freight Forwarder

TM8.1 Forwarding Order


Controlled Shipment - UI

TM8.1 Forwarding Order


Uncontrolled Shipment

Freight

forwarder
scenario - 2
Freight
forwarder has
only control over the preand the on-carriage of the
transport

Freight
Agreement
Freight
Settlement ONLY
for Main Carriage NVOCC
Ordering Forwarding
or Carrier
Party
Order

Forwarding
Agreement

Freight
Agreement

Freight
Booking
FW Settlement
ONLY for Pre and
On Carriage

Freight Forwarder

Freight
Settlement ONLY
for Pre and On
Carriage

TM8.1 Forwarding Order


Uncontrolled Shipment - UI

TM8.1 Forwarding Order


Incoterm Handling

The

incoterms (such as EXW, FOB) are an


agreement between the seller (usually the
shipper in a forwarding order) and the buyer
(usually the consignee in a forwarding order) of
goods
Define how the responsibilities and costs for the
transport of goods are shared between seller and
buyer.
Since incoterms are agreed when the goods are
purchased, the freight forwarder is not involved at all
when incoterms are agreed.

TM8.1 Forwarding Order


Incoterm Handling - Practical Scenario

Two

dimensions of the overall cost settlement process


External Settlement

Defined by the Incoterms and Organizational Unit that has the


business relationship (forwarding agreement) with Shipper /
Consignee
Completely Independent of which Organizational Unit actually
organizes which part of the transport
Internal

Settlement

In an export-import scenario and incoterm FOB, the export


organization organized and paid pre-carriage and main-carriage,
but it is only paid from the shipper for pre-carriage
Export organization needs to settle costs for the main-carriage to
the Import organization which in turn settles the consignee for it

TM8.1 Forwarding Order


Incoterm Handling Agreement Party

Key

requirement is to identify which parts


(stages) of the transport is paid by whom
Prepaid Agreement Party
Prepaid refers to the business partners from whom the

goods are moving away


Collect

Agreement Party

Collect refers to the business partners to whom the

goods are moving to


Agreement

Party Type

Defines, whether the stage has to be settled prepaid,

collect, or not at all

TM8.1 Forwarding Order


Prepaid Agreement Party

The

business partner with whom a forwarding


agreement is made for the first part of the
transport, according to the agreed incoterms
Prepaid Agreement Party may also be prepaid bill-to
party and prepaid payer
The system uses the prepaid agreement party to

calculate the charges in the invoice for the seller

TM8.1 Forwarding Order


Collect Agreement Party

The

business partner with whom a freight


agreement is made for the last part of the
transport, according to the agreed incoterms
Collect Agreement Party may also be collect bill-to
party and collect payer
The

system uses the collect agreement party to


calculate the charges in the invoice for the buyer

TM8.1 Forwarding Order


Prepaid Bill-To Party

The

business partner that is billed for the first


part of the transport, according to the agreed
incoterms
Prepaid bill-to party is not necessarily the prepaid
payer

TM8.1 Forwarding Order


Collect Bill-To Party

The

business partner that is billed for the last


part of the transport, according to the agreed
incoterms
Collect bill-to party is not necessarily the payer

TM8.1 Forwarding Order


Prepaid Payer

The

business partner that pays for the first part


of the transport, according to the agreed
incoterms
Prepaid payer may not necessarily be the prepaid
bill-to party

TM8.1 Forwarding Order


Collect Payer

The

business partner that pays for the last part


of the transport, according to the agreed
incoterms
Collect payer may not necessarily be the collect billto party

TM8.1 Forwarding Order


Incoterm Handling General Data Tab (Step 1)

TM8.1 Forwarding Order


Incoterm Handling Business Partner Tab (Step 2)

Credit Limit Check

Credit Limit Check from worklist

TM8.1 Forwarding Order


Incoterm Handling Stages Tab (Step 3)

TM8.1 Forwarding Order


Shortcut Processes

New

shortcut process introduced from the


Forwarding Order Stages UI
In TM8.0, the ability to create/select Air/Ocean Booking
was at the header level of the business document
(Follow-Up->Create/Select Ocean Booking)
In TM8.1, the functionality has been moved to the
Stage view of the forwarding order
Select/Create freight bookings for the main carriage stages

of the Actual Route


Creation of Freight Orders for specific stages (pre-carriage
and on-carriage stages)
The kind of stage is determined by user defined Stage Type
which is associated to Stage Category

TM8.1 Forwarding Order


Enhanced Stage UI

TM8.1 Forwarding Order


Enhanced Stage UI

The

Stage UI was enhanced in such a way that it


is possible to also edit the Actual Route
Possibility to modify data of existing stages, creating
new stages and delete existing stages
New fields added to Stage Header and Stage UI

Port of Loading
Port of Discharge
Source CFS
Destination CFS
Vessel ID
Voyage etc.

TM8.1 Forwarding Order


Organizational Unit Interaction

Concept

introduced to allow the user specify


the responsible organization for further
processing of the stage
Field Planning and Execution Organization
capture the responsible organizational unit

to

TM8.1 Forwarding Order


Organizational Unit Interaction

Summary

You

should now be able to

Outline the Business Purpose and


Requirements
Define the Business Process
List the Solution Details

Business Example

John is a customer representative / supervisor working at a


freight forwarder (Logistics Service Provider) organization and
receives transportation requests from multiple customers &
shippers. He needs to record and process the requests as
Forwarding Orders in the Transportation Management system

Agenda

Configuration Steps

Process Flow

TM8.1 Forwarding Order


Scenario Overview

Freight Forwarders
Gateway (CFS)
(Yokohama, Japan)

Station
of Origin
Pickups

Shippers (OtaKu, Gifu,


Japan)

LineHaul /
Feeder

Port-ofLoading
(Yokohama
Japan)

Forwarding
House Station
(Nagoya, Tokyo)

Freight
Forwarders
Gateway (CFS)
(Los Angeles, USA)
Station
of Destination
Port-ofDestination
(Long Beach
USA)

LineHaul /
Feeder

Deliveries
Forwarding House
Station
(San Diego, Phoenix)

Consignee
s
(Sedona,Tus
con, USA)

TM8.1 Forwarding Order


Create Company Export Business Unit

Company represent the


top hierarchy or
business unit of the
organizational model

Need to maintain the


organizational model in
TM

Assign Forwarding House


to Companies

NWBC-Master DataOrganization-Create
Organization and Staffing

TM8.1 Forwarding Order


Create Company Import Business Unit

Company represent the


top hierarchy or
business unit of the
organizational model

Need to maintain the


organizational model in
TM

Assign Forwarding House


to Companies

TM8.1 Forwarding Order


Create Forwarding Houses Export Business Unit

Forwarding Houses
represent the
individual stations or
business units of LSP

Each forwarding
house acts as a
sales, purchasing,
and transport
planning/execution
unit

TM8.1 Forwarding Order


Create Forwarding Houses Import
Business Unit
Forwarding Houses
represent the individual
stations or business
units of LSP

Each forwarding house


acts as a sales,
purchasing, and
transport
planning/execution unit

TM8.1 Forwarding Order


Assign Positions and Users to Forwarding
Houses
Assign Employees to
Organizational Units

Each forwarding
house has its own
representative user
with a one-to-one
relationship with the
forwarding house

Maintain one user for


each Forwarding
House

TM8.1 Forwarding Order


Define Package Type Codes

Allows for
standardization of
packages used to
transport cargo

SPRO-SAP TM-TMBasic Functions-Type


Codes and Role
Codes-Master Data
Related Type Codes
and Role CodesDefine Package Type
Codes

TM8.1 Forwarding Order


Define Item Types

Define specific
measures for example
height, width, volume
and weight of a
transportable item
category

SPRO-SAP TM-TMForwarding Order


Management-Define
Item Types for
Forwarding Order
Management

TM8.1 Forwarding Order


Define Stage Types

Specify whether the


stage is main
carriage, pre-carriage
or on-carriage

SPRO-SAP TM-TMBasic Functions-Type


Codes and Role
Codes-General Type
Codes and Role
Codes-Define Stage
Types

TM8.1 Forwarding Order


Define Default Agreement Party Roles for Stages

Define Agreement
Party role type (Prepaid / Collect) for
Incoterm and Stage
type combination

SPRO-SAP TM-TMForwarding Order


Management-Define
Agreement Party
Roles for Stages

TM8.1 Forwarding Order


Define Transportation Mode

Specify how cargo is


transported, for
example, by road, rail,
sea or air

SPRO-SAP TM-TMMaster DataTransportation


NetworkTransportation LaneDefine
Transportation Mode

TM8.1 Forwarding Order


Define Allowed Transportation Modes for Stage Types

Assign transportation
modes to stage type

Define which
transportation
modes can be used
for a stage of this
type

SPRO-SAP TM-TMBasic
Functions-Type Codes
and Role CodesGeneral Type Codes
and Role CodesDefine Allowed
Transportation Modes
for Stage Types

TM8.1 Forwarding Order


Define Movement Types

Movement types
predefine stages in
the forwarding order

SPRO-SAP TM-TMBasic Functions-Type


Codes and Role
Codes-General Type
Codes and Role
Codes-Define
Movement Types

TM8.1 Forwarding Order


Define Stage Type Sequence for Movement Type

Movement types
predefine stages in
the forwarding order.

Define stage types


that should be
associated to the
forwarding order
when using the
corresponding
movement type

SPRO-SAP TM-TMBasic Functions-Type


Codes and Role
Codes-General Type
Codes and Role
Codes-Define Stage
Type Sequence for
Movement Types

TM8.1 Forwarding Order


Define Forwarding Order Types

Define parameters of
the forwarding order
that influence how the
system processes the
business document

SPRO-SAP TM-TMForwarding Order


ManagementForwarding OrderDefine Forwarding
Order Types

TM8.1 Forwarding Order


Define Forwarding Order Types

Define parameters of
the forwarding order
that influence how the
system processes the
business document

SPRO-SAP TM-TMForwarding Order


ManagementForwarding OrderDefine Forwarding
Order Types

SAP TM 8.1
Freight Unit Building Rule

Freight unit Building Rule:

Transportation
Transportation
Requirement
Requirement

Used for automatic


creation of a freight unit
based on one or more
transportation requirement
Freight Unit Building can
use the following
Consolidation strategies:
Per item
Per request
As much as possible

FU type determination
using default value or
Condition

Several Split quantities in


different UoM possible

Freight
Freight Unit
Unit Builder
Builder

Freight
Freight Unit
Unit

Freight
Freight Unit
Unit

Freight
Freight Unit
Unit

Freight Unit Type

Freight unit type:

Flexible
customization options

Change Controller

Checks for Creation /


Save / Deletion

Execution Tracking
settings

Org.-Unit
Determination

Direct Shipment
Process

Default values

Pick-up / Delivery
Window calculation

TM8.1 Forwarding Order


Assign Item Types to Forwarding Order Types

Assign Item Type to


Forwarding Order
Type

With this, the item


type is usable in any
forwarding order of
the respective type

SPRO-SAP TM-TMForwarding Order


ManagementForwarding OrderAssign Item Types to
Forwarding Order
Types

TM8.1 Forwarding Order


Define Default Freight Document Types for Stages

Specify which freight


document type
(Freight Order Type /
Freight Booking Type)
is used for generating
business documents
through shortcut
process in forwarding
order

SPRO-SAP TM-TMForwarding Order


ManagementForwarding OrderDefine Default
Freight Document
Types for Stages

TM8.1 Forwarding Order


Assign Roles to User

Assign standard roles


to user

Roles are used to


choose a menu and
create the
corresponding
authorization profile.

After this roles can


be assigned to users

Agenda
Configuration
Process

Flow

Steps

TM8.1 Forwarding Order


Process Steps

Manage
Freight
Bookings for
Export

Manage
Forwarding
Orders

Execute &
Monitor Freight
for Export

Plan
Drayage to
Container
Terminal

Execute
Drayage to
Container
Terminal

Container
Arrival at Port
of Destination

Create PickUp

Loading of
Freight for
Main Stage

Plan Freight
For Export
Stages

Send Shipping
Instructions for
Main Stage

Generate Main
Stage Shipping
Documents

Forwarding
Settlement
to Shipper

Freight
Settlement

TM8.1 Forwarding Order


Step 1 Manage Freight Bookings for Export

TM8.1 Forwarding Order


Step 2 Manage Forwarding Orders

TM8.1 Forwarding Order


Step 3 Select Schedule for Main Carriage Stage

TM8.1 Forwarding Order


Step 3a View and Select Proposals

TM8.1 Forwarding Order


Step 3b Pre-Carriage/On-Carriage stages added to Forwarding Order

TM8.1 Forwarding Order


Step 3c Main Carriage Stage Details

TM8.1 Forwarding Order


Step 4 Main Carriage Schedule Confirmation by Gateway (CFS)

TM8.1 Forwarding Order


Step 4a Main Carriage Org Interaction Status set to Confirmed

TM8.1 Forwarding Order


Step 5 Assign Freight Booking to Main Carriage Stage

TM8.1 Forwarding Order


Step 5a View and Select Freight Booking

TM8.1 Forwarding Order


Step 5b Main Carriage Stage Planned

TM8.1 Forwarding Order


Step 6 Create Freight Order for Pick-Up

TM8.1 Forwarding Order


Step 6a Pick-Up Stage Planned

TM8.1 Forwarding Order


Step 6b View Pick-Up Freight Order

Summary

You

should now be able to

Explain the Configuration steps


Explain the Process Details