Transportation Planning and Vehicle Scheduling is a part of SCM APO. Some people are aware of it. But it still is a somewhat unknown quantity. In this blog, I will give you an overview about the TP/VS submodule in APO. This module is responsible for automatic planning for Logistics execution. The actual execution still takes place in SAP R/3. But here we can optimize and plan shipments. This can be done automatically by the optimizer. Here everything works on costs. The constraints are modeled as soft or hard constraints. Soft constraints just add some hypothetical cost (set in the system) so that the constraint is followed but waived off at a cost. You can put constraints on virtually everything associated with transportation planning. The input is Sales order or Delivery or Stock trasfer order. In case of a Sales Order, the order is broken down into freight units if required (according to the split rules). Then the freight units are planned and optimized into temporary shipments. Here they are consolidated and accociated with Means of Transports and Forwarding agents (all of which can be done automatically). Then the delivery can be generated followed by a shipment generation in R/3. The communication between R/3 and SCM takes place through the core Interface. In SCM, transportation lanes are maintained which contain all the information (like, duration, stages, stop offs, forwarding agents, Means of Transports etc). These Transportation lanes form the basis of all the calculations. I feel that the most important part of this is automatic transportation planning in SCM is when it is called from R/3. It is possible to do a combined transportation planning and ATP check when creating or changing a Sales Order. This is amazing facility. It enables businesses to promise the quantity and give a realistic idea about the delivery of products at the time of creating a sales order itself. This functionality is called Dynamic route determination called from R/3. It not only does the transportation planning, but modifies the schedule line date and time accordingly. The ATP check is modified and carried out in accordance with Transportation planning. Hence if some order has to be delivered after 10 days, and transportation time is 2 days, then the availability check will be done for 8 days from now. It really has a great potential. Especially for an enterprise which has its own transportation system in place, it can be a great cost saver.