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Recently I had an interesting meeting with a fashion retailer looking for a new warehouse management solution. In my role as Solution Owner for Digital Logistics in SAP’s retail industry team I am happy to share our discussion.

SAP Extended Warehouse Management (SAP EWM) is designed to manage high-volume warehouse operations and integrate complex supply chain logistics with warehouse and distribution processes – delivering the ultimate in visibility and control. Optimize inventory tracking, cross-docking, distribution operations, multichannel order fulfilment, and more – all in real-time. It is available since 2006, the latest release is SAP EWM 9.5.

 

SAP Fashion Management

In 2014, SAP launched SAP Fashion Management, the industry specific version of its classical ERP solution. SAP Fashion Management is a multichannel, vertically integrated solution covering fashion-specific, retail, wholesale and manufacturing processes. You can connect SAP EWM out-of-the-box to SAP Fashion Management. Consequently, SAP EWM runs in a decentralized scenario connected to SAP Fashion Management as backend ERP system. This approach is proven since many years with a decentralized SAP EWM connected to a standard SAP ERP or connected to the retail industry specific ERP solution SAP Merchandising for Retail.

 

Decentral Deployment of SAP EWM (decentral or sidecar approach)

The approach of a decentralized SAP EWM connected side by side to an SAP ERP system supports business scenarios and processes for complex and automated warehouses and distribution centers. It provides proven customer value, such as high-volume data processing, risk mitigation and scalability for large distribution centers. But what does that mean in detail?
In the fashion industry, high-volume and high-performance warehouses and distribution centers with automation like high rack storage, automated sorters and conveyors are often in place. SAP EWM can guarantee performance and availability as it receives a chunk of deliveries as workload from SAP ERP and can afterwards process this particular workload independent from the SAP ERP system. In this way the warehouse can ensure short response times for the warehouse pickers and especially for the connected warehouse automation also when SAP ERP is executing a number of parallel processes which might affect performance e.g., large finance reports running. SAP EWM could even work on the received workload and perform all logistics processes if SAP ERP would be exceptionally down. With a decentralized SAP EWM you might also follow a different release strategy for SAP EWM than for the ERP solution e.g., do a specific release upgrade only for SAP EWM and not for the whole ERP solution.

 

SAP S/4HANA for fashion and vertical business

In September 2017, SAP launched the industry-specific version of our SAP S/4HANA product line for vertically integrated fashion companies: SAP S/4HANA for fashion and vertical business. This solution enables fashion companies to run business models from manufacturing down to retail on a single platform, reengineer business processes and reimagine their work, so that they can intelligently match their demand and supply, act as an integrated unit and unlock business innovation. You can connect SAP EWM out-of-the-box to SAP S/4HANA for fashion and vertical business following the decentralized approach as described above.

Fashion companies can connect decentralized EWM out-of-the-box to SAP Fashion Management. Customers who started already their journey to the intelligent enterprise can connect decentralized EWM out-of-the-box to SAP S/4HANA for fashion and vertical business. The integration of SAP EWM to SAP S/4HANA for fashion and vertical business is based on the same technology applied for communication of SAP EWM with SAP Fashion Management.

 

SAP Apparel and Footwear Solution

But what about the 300+ fashion companies and brand manufacturers who still run SAP Apparel and Footwear Solution (SAP AFS)? They run an SAP ERP system with a highly modified data model. Unfortunately, an out-of-the-box integration of SAP EWM to SAP AFS is not possible. However, we have customers who connected SAP EWM even to third-party ERP systems and of course there are also many AFS customers running SAP EWM. Some of them did the integration between SAP AFS and SAP EWM with the help of SAP’s Focused Business Solution (FBS) “SAP EWM for Fashion” which adapts SAP EWM to SAP AFS so that the main fashion business processes are supported.

But – would it be a good idea to connect SAP EWM to SAP AFS these days?
No, this can definitely not be recommended as it would certainly be an investment in the past! To connect SAP EWM to SAP AFS would mean to invest money and time to modify an SAP EWM system which originally perfectly integrates to SAP S/4HANA for fashion and vertical business. So, the better choice is for sure to invest in moving from SAP AFS to SAP S/4HANA for fashion and vertical business and then take advantage from SAP EWM’s out-of-the-box-integration to SAP S/4HANA for fashion and vertical business to run simply vertical.

 

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