In the current global business scenario, it is essential to have a system to manage your company's complex logistics and supply chain processes. A digital supply chain is the key to success in the modern business world. With the digital transformation of logistics, companies are looking for new ways to increase efficiency and reduce costs while building resilient supply networks. The solution is SAP S/4HANA TM, a strategic application for transportation management that handles end-to-end transportation processes from creating and monitoring an efficient transportation plan that helps enhance service levels, reduces costs, and optimizes resource utilization.
SAP S/4HANA is an advanced enterprise resource planning (ERP) system that can help businesses build supply chain resilience. Transportation Management (TM) is a strategic application designed to address and cover end-to-end transportation processes. Being embedded in S/4HANA as the new solution for transportation, SAP TM is a gamechanger.
SAP LE-TRA or Logistics Execution Transportation, as the sub-module for logistics execution in SAP ERP, is a popular solution used by businesses for transportation execution, and freight cost settlement.
SAP wanted to streamline the processes and simplify functional usage by making a single application responsible for all transportation processes. Thus, the intent is to have a single application for freight management instead of both LE-TRA and SAP S/4HANA Supply Chain for Transportation Management. Therefore, SAP has announced that the mainstream maintenance availability for LE-TRA (as part of Business Suite 7) will end in 2027. The replacement solution is the new generation SAP S/4HANA Transportation Management.
Businesses already using SAP LE-TRA (Logistics Execution in SAP ECC for Transportation) are familiar with SAP ERP's basic functions that enable the processing of inbound and outbound shipments across all transportation modes. There can be the following two instances for such businesses:
SAP provides mainstream maintenance support for Business Suite 7 until 2027. It will extend optional maintenance for such enterprises until 2030 at an additional fee. After this period, if the customers continue using SAP Business Suite 7, software systems will be transferred to a customer-specific maintenance model.
While LE-TRA functionality is still available today within S/4HANA, SAP has announced the end of its compatibility scope in 2030.
SAP S/4HANA Supply Chain for Transportation Management is an application that covers most shipper and logistics service providers' processes. SAP S/4HANA TM thus provides functionality comparable to what LE-TRA offers. Basic Shipping in S/4HANA is the new solution that replaces LE-TRA without any additional licensing cost. However, if the earlier scope of the old LE-TRA solution did not include the functionality, it is likely not covered by Basic Shipping in SAP S/4HANA either. With Basic Shipping, SAP customers can perform most of the functions included in the old LE-TRA while utilizing the new SAP S/4HANA TM objects, transactions, and codebase. Customers can also opt for Advanced/Professional shipping as a part of SAP S/4HANA TM at an additional license cost. SAP offers the full-featured solution Advanced TM for organizations with more complex transportation requirements.
If you are still using LE-TRA, it may be time to consider switching to SAP S/4HANA TM. Migration from LE-TRA to SAP S/4HANA can seem like a daunting task. But there are several compelling reasons why you should make the switch. Many companies are still using outdated software, leading to security risks and data loss. Obsolete software is often less secure, making your company vulnerable to cyberattacks. SAP has made it a top priority to ensure that its suite of products is compliant with the latest global standards and regulations.
Watch this webinar, where we've detailed insights and best practices regarding the evolution of your transportation management program.
SAP S/4HANA TM is designed for the digital age. It uses the latest technologies, including in-memory database processing and advanced analytics, to help you make better decisions faster. It has comprehensive capabilities for managing your logistics and supply chain operations. Many LE-TRA customers usually use an external non-SAP TMS such as JDA or OTM. With SAP TM inside S/4 HANA as an embedded option, customers can significantly improve the integrated solution and reduce the functional silos. Migrating to SAP S/4HANA TM from LE-TRA can benefit logistics, supply chain, and IT managers. Here are seven reasons why you should switch:
1. Enhanced functionality
SAP recommends the usage of SAP TM even for the basic shipping process. SAP may no longer introduce any new functionality in LE-TRA. Therefore, businesses still using SAP LE-TRA will not be able to leverage new functionalities introduced in SAP TM. Any new functionalities which address new process requirements in logistics are introduced in SAP TM. If customers continue to use SAP LE-TRA but want to leverage new functionalities, they may have to develop them in-house with an internal IT team.
2. Avoid Duplication
It doesn't make sense to duplicate functionalities across various SAP solutions from a product perspective. As mentioned earlier, SAP is trying to consolidate all transportation-related functionalities into a one-stop solution, i.e., TM. SAP will eventually phase out obsolete and redundant modules such as LE-TRA to facilitate this architecture.
3. Process Automation
Businesses can switch over from many manual processes in transportation. With SAP TM, shippers can leverage automated planning, carrier selection, and tendering. Further automation of freight capacity procurement, freight status monitoring, and freight invoice verification increases the efficiency of the processes. Optimized transportation planning ensures cost and resource optimization, increasing service levels. Similarly, optimized carrier selection ensures proper capacity utilization and significantly lower costs.
4. Reduce Freight Spend
Automation of processes in SAP TM can help with optimum freight cost negotiations. Businesses can analyze freight contracts with simulation and what-if analyses. Also, with real-time monitoring of transportation statuses, companies can observe a significant reduction in expedites and overhead costs.
5. Enhanced Visibility
Now obtain real-time shipment and order visibility through integrated freight execution tracking, event reporting, and map-based tracking functionalities. Also, monitor freight cost and order visibility with extensive and advanced real-time analytics.
6. Proactive Supply Chains
With SAP TM, improve your business's response to any disruption in real time. Through shipment status visibility and alerts, respond better to any unforeseen event and transform from a reactive to a proactive supply chain. Leveraging dynamic re-planning capabilities and real-time integration with the warehouse enable efficient order processing.
7. Improved Usability
Leverage enhanced user experience, administration, advanced map-based planning tools, Gantt charts, and load planning capabilities to provide exceptional value while significantly lowering the total cost of ownership.
Migration to SAP S/4HANA TM is an excellent opportunity for organizations to begin their digital transformation. SAP is a standalone application that can be connected to SAP Cloud Platform seamlessly, allowing you to develop cloud applications more quickly with advanced platform capabilities while benefiting from the powerful business process management capabilities of previous versions. This new release enables developers and partners to build intelligent cloud apps that are secure by design while accelerating development time through true multi-cloud capabilities.
Making the switch from SAP LE-TRA to SAP S/4HANA can seem complicated, but with ArchLynk's help, it can be a smooth and relatively streamlined process. We provide scenario options to improve your insights, migration methodology, accelerators, and recommendations based on best practices scenarios to start your migration feasibility and definition of your implementation strategy. With the numerous benefits of making the switch to SAP S/4HANA TM, there's no reason to refrain from the transition. Register for a discovery workshop for more information on how we can help you make the switch and start reaping the rewards for your business.