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Based on the SAP Cloud Platform, the SAP Logistics Business Network (LBN) is an open network that companies can access via a monthly SaaS subscription. It enables companies in a supply chain to collaborate on and manage three areas of logistics management: freight management and collaboration, which helps with managing the shipping process from tendering an offer to payment; supply chain traceability, which tracks the origins of goods and raw materials; and supply chain visibility, which tracks shipments in transit and analyzes shipper performance.
The SAP LBN's freight management capabilities were enhanced in the last year or so via partnerships with digital freight forwarding services from Uber Freight in the U.S. and InstaFreight in Europe. More recently, the LBN has expanded its supply chain visibility through new partnerships with Project44 Inc., ClearMetal Inc. and Shippeo.
Project44 provides real-time visibility and tracking of road and ocean freight; ClearMetal provides in-transit container and shipment tracking for ocean freight, along with machine learning capabilities so that companies can continually adjust and improve the freight shipping experience; Shippeo provides supply chain visibility capabilities for shippers and carriers in Europe.
The new partnerships provide members of the SAP LBN with key logistics data on shipment location, shipment status changes and estimated arrival times for road freight and trans-ocean shipments, said Till Dengel, global head of digital logistics solutions management at SAP.
Know where the goods are
"Now we're focused on the visibility part and getting real-time information about where goods are and if there are any deviations from your plans so you can raise alerts and inform people that are part of the supply chain," Dengel said.
Each partner brings capabilities and coverage areas that enable SAP LBN members to expand their supply chain visibility, he said. The partner companies help to create a "network of networks" that compounds the value created by aggregating and analyzing all of the data that flows through it.
"Project44 and Shippeo get the data directly from the trucks. Then, by feeding that data into LBN, you can look at a map to see where they are, how they move, get real-time expected ETAs and then also trigger the alerts, if you want," Dengel said. "Another important area is multimodal tracking, which goes beyond just the tracking the trucking and into the ocean freight tracking, and ClearMetal is the key provider in the ocean business, giving you real-time visibility into vessels and where they are."
Importance of supply chain visibility
Improved supply chain visibility is becoming increasingly important for companies, and the new partnerships help enhance the SAP LBN, said supply chain analyst Bart De Muynck, vice president at Gartner.
"SAP has historically always been a little behind the ball when it comes to partnerships in the logistics space, and Oracle still has the biggest ecosystem of partners as they've been doing this for a long time," De Muynck said. "SAP's partner network was weaker, but they've stepped up the game with the LBN and have recognized what we realized -- that they need these partnerships because they can't do everything by themselves."
The aggregating of data and making it available to network users is a big advancement, he explained. Supply chain transportation management systems traditionally operated only within a company and were optimized only for that company.
"Now these networks allow you to cross-optimize between the shipper and the carrier, but also between different shippers, and that's what's making this a lot more collaborative," De Muynck said.
That added collaboration and visibility into the inner workings of the network is a much-needed asset, especially as the COVID-19 pandemic has caused volatility across supply chains.
"Visibility has only become much more important for people to not just understand what's going on right there," he said, "but to also get that data to get better insights so that into the next step, they can start predicting and can improve operations and make supply chains more efficient."
The SAP LBN's new partnerships can help businesses address some of the most difficult challenges in the supply chain, said Dana Gardner, president and principal analyst at Interarbor Solutions, an enterprise computing analysis firm in Gilford, N.H.
"Organizational boundaries between enterprises remain among the thorniest integration points for secure transactions and logistics processes," Gardner said. "Improved extended supply chain logistics and more digital tracing, at the same time, have never been more essential for businesses to be agile and adaptive."
The SAP LBN is rapidly advancing a SaaS model for secure supply chain visibility capabilities, and may be a catalyst for companies to adopt blockchain capabilities, he said.
"SAP is integrating blockchain with their services, cloud platform and vertical solutions," Gardner said. "SAP LBN acts as an accelerant to blockchain adoption in that end users don't need to master blockchain on their own but can benefit from the attributes of blockchain nonetheless in a solution package."