SAP EWM, TM and SAP Logistics Management are setting new technological standards. Why this transformation is necessary now, and how companies can set the right course before they begin.
Many logistics transformations fail not because of the technology, but because they get off to the wrong start. Whilst modernising logistics is high on the agenda for many companies, the operational reality is often still characterised by fragmented structures, manual workflows and isolated process silos between warehousing, transport and handling.
Systems are often not integrated, and media breaks and paper-based processes remain widespread. These structures are usually kept afloat by employees’ experience, communication and improvisation. At the same time, there is a lack of transparency and data quality needed to capitalise on optimisation potential in a targeted manner.
With increasing supply chain complexity, cost pressures, a shortage of skilled workers, new technologies and the end-of-life of established SAP logistics solutions, the pressure to act continues to grow. Logistics transformation is therefore no longer an optional improvement, but a strategic imperative.
Thesis 1: Logistics transformations do not fail because of the technology, but because they get off to the wrong start
A key pattern emerges in this situation: transformations rarely fail because of the technology, but often because they get off on the wrong foot. Many initiatives begin with a purely functional discussion. Questions are asked about which features a solution offers, what automation functions are available, or whether AI is integrated.
Alternatively, attempts are made to transfer existing processes unchanged into new systems or to standardise them across the board using global templates. However, both approaches prevent the true potential of the transformation from being realised. Instead of structural improvement, there is merely a technological replacement, without any real added value being created.
Thesis 2: The key lies in a clearly articulated value proposition
The key to success therefore lies in a clearly articulated value proposition. The starting point for any transformation is an honest analysis of existing weaknesses and areas for improvement.
In transport and warehouse logistics, this manifests itself, for example, in a lack of transparency regarding freight costs, insufficient control over planned and actual costs, long lead times in goods-in, or inefficient processes that result in financial benefits – such as cash discount periods – going untapped.
These areas of potential must be identified, prioritised and translated into concrete objectives. Only then can a decision be made as to which technological solutions are appropriate.
A successful transformation follows a structured, value-oriented approach: measures are prioritised according to their value potential and implementation effort, and introduced in stages to create visible added value early on, build acceptance and develop the transformation in a targeted manner.
In the SAP environment, various logistics solutions are available for this purpose: high-performance systems for complex structures as well as leaner cloud solutions for less complex scenarios.
The crucial shift in perspective is:
From a feature-based mindset to value contribution – in other words, moving away from ‘Which function do I want?’ to ‘What added value do I want to achieve?’
There is no one-size-fits-all solution. The system landscape must be tailored to the requirements of the specific site: large, complex logistics sites require a different scope of functions to smaller or less critical units. Successful architectures therefore combine different solutions effectively within a hybrid approach.
In the case of artificial intelligence, too, added value does not arise from the technology itself, but from its targeted use. AI can, for example, guide users through process configuration and reduce manual tasks.
In the long term, the aim is to create an autonomous enterprise in which systems take over routine tasks and staff concentrate on management and exceptions. However, well-defined processes and sufficient data quality remain essential; without this foundation, the benefits of AI remain limited.
Thesis 3: The success of the transformation is determined before the actual implementation takes place
Another crucial factor lies in the preparation for the transformation. The greatest driver of a project’s success lies not in the implementation, but in the upstream analysis and design phase.
This involves a thorough understanding of the actual processes, which often goes beyond the documented workflows. Equally important is a realistic assessment of data quality and the integration requirements between systems. A consistent end-to-end view of the processes is essential to avoid isolated optimisations.
Organisational change management is also particularly often underestimated. The introduction of new solutions requires not only technical adjustments, but also changes in working methods, responsibilities and ways of thinking.
The five most common reasons why logistics transformations fail
In practice, five typical reasons can be identified as to why logistics transformations fail:
- underestimating the complexity
- an unclearly defined scope
- insufficient stakeholder involvement
- a lack of an end-to-end view, as well as
- shortcomings in the integration and interaction of systems.
These challenges are well-known and recurring. At the same time, they can be avoided if addressed at an early stage.
The transformation of logistics is therefore far more than just an IT project. It offers the opportunity to establish logistics as a strategic differentiator within the organisation. This requires a clearly structured, value-oriented approach that takes technology, processes and organisation into account in equal measure.
Companies that consistently follow this path lay the foundations for greater efficiency, transparency and resilience in their supply chain and secure long-term competitive advantages.
If you are currently working on transforming your logistics operations, the crucial first step is not to select a solution, but to carry out a thorough assessment of your current situation.
The cbs ‘Compass’ approaches to Logistics Excellence help to create transparency regarding the existing process and system landscape, identify specific areas of potential value, and develop a tailor-made target architecture for logistics and warehouse management.
Find out more at: https://www.cbs-consulting.com/en/next-one/supplychain/excellence/move/
