Getting started with the SAP Logistics Management setup

  am sure that by now, as an avid Supply Chain professional,  the announcement of SAP's latest solution to enrich its Digital Supply Chain portfolio has not gone unnoticed. Of course, I am referring to SAP Logistics Management.

Although being a nascent product, I will let you be the judge, but I am sure you will find the SAP Help page provided to aid you in the setup and running of the solution to already be extremely complete and rich. That said, as with any product help, there is a limit to what and how much can go into it. This blog aims to complement, not replace the provided SAP help, with visual aids to hopefully help the new comers to the SAP world as well as provide tips to maybe the more seasoned professionals amongst you. 

This blog will cover some of the key SAP Logistics Management setup tasks - that you do not want to go wrong.

Where appropriate, I will for the sake of continuity reference the relevant SAP help page.

Setting up your Organisational Structure

As with any system, there must be structure in the house (an action or transaction will occur in a structuring company level or a logical combination of many). The logistical levels of your company must be mirrored in your ERP and in SAP Logistics Management (referred to as LGM hence forth). Unless you are embarking on a green field implementation, it is quite likely that you will already have defined some of those elements, such as 'Company Code', 'Sales Area', etc.. The point of this section, will not be to cover all SAP organisational levels, but only those that are critical to be able to execute your logistics processes across your ERP and LGM.

Setting up your Organisational Structure in ERP 

I say ERP, but at the time of writing this blog I mean SAP S/4HANA Cloud Private Edition (aka Cloud ERP Private, S/4HANA PCE..), (Please check this page for minimum release requirements). Note: This blog will not cover the creation of an entire Organisational Structure (company code, shipping point, sales area, etc...) which are all needed. This blog will only focus on the key organisational levels required to create a warehouse in LGM.

This step will essentially entail defining a third party  warehouse. To do so you will need to leverage /create 3 SAP organisational objects:

• A Plant
• A Storage Location
• A Warehouse (number)

Once you have created those organisational elements, you will then need to indicate how they relate to one another and also let your ERP know that the warehouse you have created is managed -externally- to your ERP (your inventory value and quantity will be managed and visible in ERP at the IM -Inventory Management- level, but managed and tracked in quantity down to the warehouse bin level in LGM).

The steps required to define a third party warehouse are detailed here in the LGM SAP Help.

Define a Plant

LGM can be deployed in a green or brown field implementation scenario. Thus it may be that you already have a plant defined in your system that you simply wish to extend to be used with LGM, or you need to create a new one to coincide maybe with the creation of a new warehousing site.

If you need to create one, then go to your ERP implementation guide (transaction SPRO), and then follow the path SAP Customizing Implementation Guide --> Enterprise Structure --> Definition --> Logistics - General --> Define Plant

Enter the Plant details, such as (1) the plant code and name and (2) address details) and save your entries when you are done.

Defining a Plant

I will not show these steps in detail, but also make sure to complete the assignments of your plant to company code (Customizing Implementation Guide --> Enterprise Structure --> Assignment --> Logistics - General --> Assign plant to company code) , the assignment of a shipping point to your plant (Customizing Implementation Guide --> Enterprise Structure --> Assignment --> Logistics Execution  --> Assign shipping point to plant) and the assignment of a purchasing organisation to your plant (Customizing Implementation Guide --> Enterprise Structure --> Assignment --> Materials Management  --> Assign purchasing organization to plant). 

Define a Storage Location

To create a storage location, then go to your ERP implementation guide (transaction SPRO), and then follow the path SAP Customizing Implementation Guide --> Enterprise Structure --> Definition --> Materials Management --> Maintain Storage Location . The storage location is hierarchically below the plant, so before being able to define a storage location, you first have to indicate the plant in which you want to create this storage location. We will use the plant code previously created.

We will then select the 'New Entries' button and add (1) our storage location code and description and then (2) the address of the storage location. Remember that this storage location, will effectively be a warehouse (as I am using a demo system I have given the description 'LGM WHouse L10' for my storage location and referenced a warehouse number L10 even though I have not yet created it, simply to know that it is mirrored in LGM !).

Define a Warehouse Number

The last organisational object we need to create is a Warehouse Number (that's all it is. A number and a description). To create a warehouse number, then go to your ERP implementation guide (transaction SPRO), and then follow the path SAP Customizing Implementation Guide --> Enterprise Structure --> Definition --> Logistics Execution --> Define Warehouse Number . 

We will then select the 'New Entries' button and add our warehouse number and description.

 Now that we have created all the organisational objects we need, we can now proceed to representing how they relate to another.

Assign Warehouse number to Plant and Storage Location

As said, a warehouse number, on its own is just that. So we need to indicate to ERP, what this warehouse number maps to physically - a combination of a plant and storage location. To do so go to your ERP implementation guide (transaction SPRO), and then follow the path SAP Customizing Implementation Guide --> Enterprise Structure --> Assignment --> Logistics Execution --> Assign Warehouse Number to plant and storage location. 

We will then select the 'New Entries' button, and indicate the three objects we have previously defined, namely (1) the plant code, (2) the storage location code and (3) the warehouse number. We have now mapped our plant/storage location to our warehouse.

 

Defining the warehouse as third party (external) warehouse

The last step on the ERP side, is to define the warehouse as being 'externally to the ERP' managed. This effectively to indicate to ERP, that when we transact in ERP in the plant/storage location that corresponds to a warehouse number, a message must be sent to the warehouse number to advise it to complete a logistical movement at the warehouse level.

To perform this step, go to your ERP (transaction SPRO), and then follow the path SAP Customizing Implementation Guide --> Logistics Execution --> Decentralized WMS Integration --> Central Processing --> Application --> Activate Decentralized WMS.

There, for your warehouse number, follow the instructions from the SAP help and make the settings as below.

 

Other -optional- ERP settings

I am in this section going to share with you other settings that you may need to make, depending on your scenarios. 

It may be, especially early on in your implementation project or as you test the solution that you want to update the stock in LGM, by performing an initial 561 (initial stock entry) or 501 (Receipt w/o PO) goods movement in your ERP to perform an IM (plant/storage location) movement, in order to be able to process a putaway (at warehouse level) in LGM. In order to facilitate this 'handshake' between ERP and LGM, ERP will automatically attempt to create an inbound delivery, upon saving the goods entry in ERP, but it needs some information to do this. Namely it requires a Business Partner representing the plant, acting as the 'Supplier' (moving stock from IM to warehouse level) and it requires certain delivery copy control settings to be in place.

Define Default Values for delivery

Once you have created a business partner to represent your plant as the 'Supplier', then go to your go to your ERP (transaction SPRO), and then follow the path SAP Customizing Implementation Guide --> Logistics Execution --> Decentralized WMS Integration --> Central Processing --> Application --> Inventory Management Interface and Delivery-Relevant Data --> Define Default values for deliveries.

 Then for (1) your warehouse number, indicate (2) the business partner that represents the plant and maintain the (3) logistics execution and (4) sales area information.

Copy Control for Deliveries

Upon processing a 501/561 stock movement you may get an error message saying  'Copy control is missing for: DZL DIG'. If you do, then you need to maintain additional copy control settings for deliveries. To do so go to your ERP (transaction SPRO), and then follow the path SAP Customizing Implementation Guide --> Logistics Execution --> Shipping --> Copying Control --> Specify Copy Control for deliveries . Transaction VTLA will also take you there directly.

Once there, select 'New Entries' and maintain the information as below:

Header level:

 Item Level:

 

Setting up your Organisational Structure in LGM

Now that we have defined our warehouse in ERP, we can pivot to setting it up in LGM. The relevant LGM help page for this is here. What you will notice is that there is no app in LGM that allows you to manually create any organisational object one by one, like you have in ERP or perform some kind of API sync to replicate the organisational structure from ERP. Instead, you have to perform an spreadsheet based import and upload.

NOTE: I would at this point be remiss, as indicated in the SAP help, to not remind you of an important warning before you proceed here. Whilst the 'Import Organizational Model' app performs certain checks during the import of a file, you cannot remove erroneously created organisational objects or relationships once they are created in LGM, nor is there a check against ERP to check that an imported object really exists in ERP (beware of typos! - so make sure the values you use are strictly identical to those from the source ERP system and have a second set of eyes gloss of over your upload file).

The procedure to follow in order to import your organizational structure into LGM is well detailed here. In a nutshell, you need to use the 'Import Organizational Model' app to (1) download a template spreadsheet with some sample data, amend it with your own data, and then (3) import it back into the same app, in order to (4) create your structure in LGM. There is also a dedicated help page that provides you with more details on the information you need to provide in the template for each object (you need to click on an object, then go down to the bottom of the page to see the details!).

You may also consider, as you move your project from Development --> to Test --> to Production,  to use the (2) export/import features in the 'Import Organizational Model' app to move a cleansed organisational structure down the line (rather than re-creating a new file every time).

Once you have imported your structure into LGM, a graphical representation of it is available for viewing in the 'Import Organizational Model' app.

 Handy tips in the 'Import Organizational Model' app

Using the 'Import Organizational Model' app should be fairly straight forward, but I will below highlight a couple of points that may be of use.

formOfAddress

In the 'ShippingPointAddresses' tab of the template, there is a tab named 'ShippingPointAddresses', and within it a (1) field named 'formOfAddress'. The sample file will be populated with the value '0002', and you may be wondering what this value corresponds to, and what other choices there are !

To find out the list of possible codes and their meaning, then you need to open the app (1) 'Display Code Lists' and see (3) possible values for the item (2) 'Forms of Address'.

As a preamble to this step note that your LGM system will initially be devoid of any code lists, nor do you have the ability to enter any manually in LGM. In order to have your LGM system populated with code lists, then you must perform the Code List Replication step which is detailed here in the SAP help. This step replicates these code lists directly from your SAP S/4HANA Cloud Private Edition system, by calling an API thus ensuring that your ERP is the single source of truth (and avoids double maintenance!).

As a sidenote, in order to replicate these code lists, you must choose the replication object 'SAP S/4HANA Customizing Data' during replication.

 

Handling localised texts

There is a reference to this in the SAP help here.

It may be that you are a multi-lingual organisation, and need to maintain texts for organisational objects in different languages. If that is the case, then you can maintain language specifics in the tab named 'LocalizedTexts' of the template, but you need to make sure that you reference the correct object using the correct naming convention. We will take the hypothetical example to localise a company code. 

My starting point is the template, where I have indicated the details below for a company code 1010, that is in ERP defined as being geographically located in Germany (Country_code = DE). The name, in English (my user language) of this company code is (1)  'Company Code 1010'. I have also attracted your attention to the language code (de = German) , only to say that this is the language of the company (it does not mean that 'Company Code 1010' is the German name of the company!). 

 Before I move on from this tab, I note the following information, as I will need it to localise it.

• (2) The object type (the entityName). The template allows me to localise all organisational objects, so I need to be able to indicate what object it is that I am referring to that I want to localise. Every sheet will in the top left have a unique code. In this case it is 'CompanyCodes'.
• (3) The object to localise. I could in my template have provided the data for multiple company codes, so I need to be specific about which company code it is that I want to localise. This is the code in the column named 'displayID'. In this case I refer to company code 1010.
• (4) The term to localise. We have to be specific and be able to tell which of the fields it is that I want to localise. In this case the term I want to localise is the information in the column named 'name'.

So now that I have the information I need, I can move to the sheet named 'LocalizedTexts' and see how we put this together! I have added details for other object types (entityName), but the first highlighted line is the one of interest for our company code.

 In this sheet, we carefully add the values we recorded in the 'CompanyCodes' sheet and add the missing pieces, namely:

• (4) The locale - the 2 digit language code of the localised language (the language for which we are providing a translation)
• (6) The value - the localised text. The translated text.

Once I have imported the template in to LGM and to make sure that my data is correct, we can do a check using the 'Import Organizational Model' app , by connecting in the appropriate language (go into the Fiori Launch Pad 'Me' menu, then choose 'Settings' and 'Language and region'.

Manage Warehouse Layout app

If you are like me, once the setup was done, I was eager to start setting a default warehouse in my user preferences, only to have a moment of panic when I saw, that at this point none could be selected! 

 So to avoid checking and double checking what could have gone wrong, first go to the 'Manage Warehouse Layout' app and make sure you have maintained the 'Manage Warehouse Attributes' of your warehouse! Once this is done, you should be able to see your warehouse appear in the various drop down lists in LGM. The reference to the SAP help for this section is here.

 

Importing Dimensions and Units of Measure

The LGM SAP help for this section can be found here and is quite comprehensive.

At the end of this step, you will have imported into LGM Dimensions and Units of Measure information from your ERP. In order to do this you will need to download some templates from LGM, extract some data via SE16 from your ERP, populate said templates and upload them into LGM. The help link above provides you all the information you need in order to perform this step (which applications to use, which tables to extract data from..) I will in this section merely provide you with some tips to hopefully help you speed up your workflow.

Before you begin, make sure to make note of the caution to not select the 'Respect Conversion Exit' option when you use SE16 in ERP !

Also, to avoid extracting incomplete datasets from ERP, make sure to (1) check how (2) many entries your tables contain and adjust the (3) Maximum number of hits accordingly.

 

Export/Import Dimensions data 

This step entails extracting data from tables T006D and T006T (for the localised texts) in your ERP.

To facilitate and minimise the amount of data massaging you will need to do, I would suggest you adjust the output columns to line up with those available and required by the template. For table T006D, I narrowed down my list of fields to the below - showing how they map to the template (as the templates may change over time, make sure to check in your environment before proceeding - this is your responsibility). I then extracted the SE16 table data set to Excel and copy/pasted the content in the template - making spot checks to make sure everything lined up and was accurate!

Note that I did not maintain any texts here.

 As my LGM system is intended to be used for English and German speakers, I need to extract Dimensions texts in both these languages.

As per the help, I query table T006T for this. Note: As languages tables can be quite voluminous depending on the number of languages maintained in your ERP, make sure to restrict the search to the languages of interest.

 This table will be a little tricky to handle as the columns from the SE16 Extract do not line up exactly like the template, and the language code from the SE16 extract is one character long, but the template requires 2 characters. Things to note are :

• That some (1) texts are fixed and required by the template (make sure every line has this)
• You should have a dimension repeated as many times as you have selected languages
• Use the Search and replace functions of excel to mass search and replace language 'E' for 'en' and 'D' for 'de' in the locale column.

Again make spot checks to make sure the data you will upload is accurate and complete (as the templates may change over time, make sure to check in your environment before proceeding - this is your responsibility)

Export/Import Units of Measure data 

This step entails extracting data from tables T006 and T006A (for the localised texts).

As before I will show you the column layout I selected and how I arranged it so that it mapped with the template file, allowing me to do a copy/paste operation. Again make spot checks to make sure the data you will upload is accurate and complete (as the templates may change over time, make sure to check in your environment before proceeding - this is your responsibility).

The Units of Measure file with the localised texts is probably the trickiest one to handle, so make sure to check your data set before uploading it to LGM. I say tricky because the SE16 extract will be a flat linear data extract that requires to be transposed for the upload template. I have tried to explain this with the diagram below. In other words you will for each 'keyValue' have to maintain the 'commercialCode', 'shortText' and 'longText' on different lines. At the risk of repeating myself,  make spot checks to make sure the data you will upload is accurate and complete (as the templates may change over time, make sure to check in your environment before proceeding - this is your responsibility).

 That's it for this time folks.

Stay tuned for more content on LGM, and don't hesitate to drop requests  for future blogs in the comments whether it pertains to setup or processes!

Source: https://community.sap.com/t5/supply-chain-management-blog-posts-by-sap/getting-started-with-the-sap-logistics-management-setup/ba-p/14328861