SAP LBN: A Detailed Look at the Global Track & Trace and Material Traceability Options
Creating Transparency in the Supply Chain with Supply Chain Networks
Due to increasing customer requirements on the one hand and constant changes in the market on the other, the supply chain is facing global challenges. The increasing relevance of sustainable production conditions - both on an ecological and social level - and their traceability play an essential role here.
In addition, many companies are not yet able to track exactly where their goods are currently located and when they are delivered. Often, many different systems are used, requiring a great deal of integration effort to achieve the desired transparency and traceability. It is not uncommon for communication to still take place via e-mail or even offline.
And last but not least, recent events such as the accident of the freighter "Ever Given" in the Suez Canal in March of this year or the corona-related container congestion in China's fourth-largest container port Shenzhen-Yantian these days show the complexity of challenges that the supply chain has to cope with today.
This makes it all the more important to use a supply chain network such as the SAP Logistics Business Network (SAP LBN), which aims to guarantee high transparency with real-time data through its Global Track & Trace and Material Traceability options.
According to a study by McKinsey, supply chain networks have a high market growth, which is expected to grow to 60 trillion US dollars by 2025. That would be an increase of about 30 percent of the share of the total economy to today's share, which is about one to two percent. This trend is also confirmed by Gartner with its research findings on visibility solutions in the supply chain, the key message of which is that more than 75 percent of the world's top 50 companies will have implemented supply chain business networks by 2024 to improve supply chain visibility across the board.
Global Track & Trace in SAP LBN
The Global Track & Trace option enables companies to gain real-time visibility into the entire supply chain of materials and products and track shipments. This helps optimize costs and reduce risks by identifying problems early in the supply chain.
Access to cloud-based tracking information provides visibility across the supply chain and the ability to compare planned and actual milestones in business processes. For this purpose, SAP LBN uses so-called visibility partners, such as Project44 or Shippeo, which enable customers to display the current status of their orders and map where the delivery is currently located.
Overall, Global Track & Trace is a powerful tracking engine that differs from Freight Collaboration tracking in that it can be customized. Global Track & Trace allows you to define your own or external processes with milestones and make them traceable.
Furthermore, SAP provides so-called templates for download, which provide various modeling and coding, such as purchase or sales order tracking. These make it easier to get started with the integration of Global Track & Trace. The templates are designed flexibly and offer the option of adapting them to individual specifications.
Basically, Track & Trace means the tracking of deliveries. However, if you take a closer look at the first part, "Track", it becomes clear that there is more to it than that. Track" not only defines the location of a current delivery, but also provides information about who is currently in possession of it and what its condition is. "Track" always gives a current status update, so to speak. The second part, "Trace", on the other hand, shows the path of the delivery in retrospect.
In addition to the traceability of deliveries and products, Track & Trace can also track process documents, orders and invoices. This makes the two an unbeatable team when it comes to ensuring optimum transparency and reduced risk along the supply chain based on real-time data.
Material Traceability in SAP LBN
The Material Traceability option of the SAP Logistic Business Network is used for the pedigree tracing of material used in production processes, which is also known as a batch. This works through data sharing within the supplier network. This is made up of the suppliers who have taken over individual production steps of the end product. In this way, quality problems can be tracked quickly and, in the event of a recall, suppliers can be informed quickly.
Furthermore, the Material Traceability option makes it possible to trace where the raw materials or precursors used come from and how they were obtained, thus ensuring a high level of transparency in the supply chain. The Material Traceability option is therefore particularly interesting against the background of the increasing importance of the sustainable use of resources and fair trade.
Let's take a look at the coffee supply chain as a simplified example: First, there is the supplier of raw materials who produces the coffee beans. He then sells them on to a company that roasts coffee beans. Further down the line, the beans then go to a company that packages and sells the roasted coffee beans. Thus, the supply chain or supplier network consists of three suppliers.
The Material Traceability option allows the supply chain to be traced back to its beginning, so that the company that eventually sells the coffee can trace where the roasted coffee beans come from and who produced them. This not only enables a high level of transparency, but also puts the company in a position to make reliable statements about the product and its manufacture by sharing data via blockchain technology.
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