Build Success with Innovation in Transportation and Logistics · Build Success with Innovation in Transportation and Logistics May 6, 2015 Connie Moylan, CIO, Woodgrain Millwork

CONFIDENTIAL WOODGRAIN INFORMATION

Build Success with Innovation in

Transportation and Logistics

May 6, 2015

Connie Moylan, CIO, Woodgrain MillworkTyler Roorda, TM Business Process Owner, Woodgrain Millwork


• Why SAP Transportation Management at Woodgrain

• How and what we implemented

• Business Benefits

• Lessons Learned

• Future use of SAP

AGENDA


• Privately-held, family-owned business founded in 1954• Third generation of ownership

• Woodgrain has a diverse supply chain• Vertically Integrated “Tree to Trim”( Raw lumber to finished product)

• Manufactures, sells, distributes diverse line of millwork products• doors, windows, mouldings, and other specialty wood products

• Integrated supply chain international and domestic• 20 locations worldwide• Woodgrain Millwork, Windsor Windows & Doors, Monarch Windows, Ashworth

Patio Doors, Woodgrain Distribution

• Each location managed their own transportation

• Rapid growth fueled by acquisitions over many years, resulting in multiple legacy systems to integrate and maintain

ABOUT WOODGRAIN


• Robust functionality to meet diverse set of requirements and

enable execution of business strategy

• Multiple sourcing and delivery methods

• Frequent shipment pooling and cross-docking

• Provide a platform for growth, reduce risk to business continuity −

”the system” can become a catalyst rather than hindrance

• Lower long-term TCO through elimination of many legacy systems

and multiple integrations

• ROI opportunities identified in every business unit, functional area

WHY SAP TM 9.0?


• Integration to SAP ECC Advantage over 3rd party products that are difficult to seamlessly integrate to Order

Management when frequent order updates and changes occur to meet customer demands

TM Sales Order Scheduling

• Significant opportunity to reduce supply chain costs in the area of

Transportation Management

SAP TM 9.0 greatly exceeds capabilities of current systems and processes

Bring the entire organization together under one transportation group thus increasing transportation consolidation and eliminating duplication

• Supports multiple methods of sourcing and delivery to

customers Out-of Warehouse

Cross-Dock

Direct Ship

Inter-company

Vendor consigned

WHY SAP TM 9.0? (CONTINUED)

3rd-party Warehouse

3PL service

Customer and Vendor returns

International (next phase)


• Began TM 9.0 Ramp-up program in late November, 2012

• TM was one piece of a full-scale ERP implementation at 7 Distribution sites

• Go-live on June 3rd, 2013

• Implementation Partner

Lead by Solution Architect from BestXperts

• SAP TM is built on top of the latest and greatest technology from SAP

Business Objects Framework

Post Processing Framework

Floorplan Manager UI

BRFplus

ABAP OO

• Requires techno-functional resources

SAP TM 9.0 IMPLEMENTATION AND

TECHNICAL FOUNDATION


PHASE I - FUNCTIONAL FLOW AND

INTEGRATION


• Internal fleet of 50 trucks and 100 trailers

• Minor use of external carriers as well

• Shipping within 13 states in the US

• Multi-stop

• Functionality highlights: TM Order Scheduling

Use of calendar resources for better alignment with Field Service Rep. schedules

DOT regulations mapped via Scheduling Constraints

Optimization of loads and sequencing

SAP ECC Warehouse Management integration

Integration with 3rd party software for proof of delivery and fleet tracking

GIS integration with Nokia HERE 3rd party application

SHIPPER SCENARIO


• Internal fleet Centrally plan routes for 7 different distribution centers in the US

35 – 50 Freight Orders per day

Each truck has an average of 10 to 15 stops

500 to 1,000 Sales orders/Deliveries per day

• LTL/CPU shipments 5 to 10 LTL shipments per day (mostly automated)

70 to 100 UPS shipments per day (one-time customers; automated)

1 to 5 customer pick-ups per day (automated)

• External Carrier shipments Full truck load across multiple zones

2 to 5 per day

External 3rd party shipments

DAILY VOLUME OF ACTIVITY MANAGED

IN TM


• No limitations on what type of ECC deliveries can be

planned to a single TM freight order

Customer sales

Customer returns

Vendor purchases

Vendor returns

Stock transfers

Subcontracting

Transportation cross-docking

SUPPORT FOR ALL TYPES OF ECC

SCENARIOS


TM ORDER SCHEDULING

• Ties into ATP check in SD

• Runs a simulation of

freight order optimization

in SAP TM


TM OPTIMIZER


SAP WAREHOUSE MANAGEMENT

INTEGRATION

• Visibility of ECC

handling units

(packages) in TM

• Automatic creation

of ECC shipments

from TM freight

orders for WM

loading


• Geocoding

• Geo-routing

• Map display

GIS INTEGRATION WITH NOKIA HERE


• Proof of Delivery system

(Airclic)

• Fleet tracking system (Xatanet)

• UPS labeling (UPS Worldship)

• Integrated through SAP PI

using standard SAP TM XML

messages

3RD PARTY SYSTEMS INTEGRATION


• Automated creation of 1 freight order per

1 outbound delivery

• Bypassing freight unit building rule

• No manual planning and route optimization involved

• Automatic carrier determination

LTL, PARCEL POST AND CUSTOMER

PICK-UP


• Freight Execution & Monitoring

Transportation Status Visibility & Monitoring

Capacity Monitoring

• Document & Output Management

VICS Bill of Lading (Inter-industry Commerce Std.)

Shipping Manifest

Shipping Confirmation

Turn-by-turn Directions

Transportation Packet

ADDITIONAL FUNCTIONALITY USED


• Reduction in overall supply chain and inventory carrying costs • Better visibility and more timely decision-making to make adjustments as product moves

through the external and internal supply chain

• Effectively manage increases in volume with the same or smaller number of transportation planner resources – less manual intervention

• Current: 1 transportation planner for 7 distribution centers

• Previous: 7 full-time dispatchers (one for each distribution center)

• Enables critical business processes that give competitive advantage• Robust integration between all information and processes. Example: Woodgrain can take

orders up to 3pm to load that night and make a delivery the next morning

• User interface enables employee usability • Usability supports strong end user acceptance and use

• Flexibility speeds adoption of new business processes with minimal training

• Increased service level to customers • Integration between order entry and transportation planning via TM Sales Order Scheduling

• Anticipate a minimum of 15% reduction in freight spending across all locations• Centralized planning; freight consolidation (leverage network wide volume)

BUSINESS BENEFITS & ROI


• Implementing TM requires a wide range of skill sets ERP - SD, MM, LE

PI

ABAP OO Object oriented

SAP TM

• TM uses some of the newest technology BRFplus

Business Objects Framework

Post Processing Framework

Floorplan Manager UI

• Volume testing of the optimizer is key

• Utilize SAP PI to integrate SAP ECC with SAP TM, if you already have SAP PI in place. Otherwise, consider using point-to-point (WSRM) integration

LESSONS LEARNED


• Freight Agreements

• Carrier Tendering

• Freight Settlement

• Continued Centralization of Transportation

Management across Woodgrain

• International Transportation Inbound

Outbound

Customs Broker integration

• Advanced Analytics

WHAT’S NEXT FOR TM AND WOODGRAIN


Thank You!

Documents

Build Success with Innovation in Transportation and Logistics · Build Success with Innovation in Transportation and Logistics May 6, 2015 Connie Moylan, CIO, Woodgrain Millwork