In the fast-paced world of logistics, where even packages have a schedule, what happens when the symphony of a perfectly planned freight order hits a rough road? Cue freight order discrepancies – the unexpected twist in our logistical journey.
Imagine Business X places an order for 100 units of a specific stock from a supplier. And after all the discussions, confirmations, and dealings the party agrees to transfer the stock to the business’s location. But during loading, the delivery team came to notice that:
- there is a change in the actual quantity of stocks delivered by the party
- there is a change in the actual cost that has been agreed by the party
- there is a change in the quality of the product delivered by the party
- or there is no status change or updates by the delivering party.
Definitely, the Business won’t be happy with these kinds of situations as the agreement has not been fulfilled by the delivering party. Now let’s check on what these discrepancies are, how they occur, and what we can do within the limits of SAP TM to tackle them.
Some of the common Discrepancies in freight orders within SAP Transportation Management
- Quantity Discrepancies
Discrepancies in which the actual quantities do not match the requested quantities. Sometimes, discrepancies can occur due to simple human errors in data entry. These might include incorrect weight or volume of the shipment, wrong pick-up or delivery times, or incorrect addresses.
- Data Synchronization Issues
Discrepancies can occur if there’s a delay or issue with data synchronization between SAP TM and other systems, such as SAP ERP or third-party systems. For example, if the ERP system updates the quantity of a shipment but the TM system doesn’t receive this update, it can cause discrepancies.
- Cost Discrepancies
There might be discrepancies between the planned and actual costs of a freight order. These could be due to changes in the freight rates, additional charges not accounted for in the initial planning, or calculation errors.
- Integration Issues
If SAP TM is integrated with other systems for functionalities such as freight settlement, tracking, and tracing, or customs management, discrepancies can arise due to issues in these integrations. For example, if there’s a delay in receiving tracking information from a third-party system, it could lead to discrepancies in the freight order status.
Discrepancies in freight orders within SAP Transportation Management could occur due to several reasons. These might include data entry errors, issues with data synchronization, mismatches between planned and actual costs, problems with the integration between SAP TM and other systems, and more.
To resolve these discrepancies, it’s crucial to identify the root cause. The solution could range from a simple data correction to a more complex process of adjusting the integration parameters or even re-engineering business processes.
In SAP TM, discrepancies can be handled as follows:
- Report discrepancies between Actual Quantity and planned Quantity
When a discrepancy is reported in an FO/FB document, the system automatically blocks the subsequent stages of the transport when reported discrepancies are not yet resolved
For removing this particular block, we can set up a tolerance range for reported quantity discrepancies. - Report discrepancies in Damaged packaging of goods and other un-planned discrepancies
Enter discrepancies on the Discrepancies tab of the individual freight order item or freight booking item. You enter a discrepancy by making entries including the following:1. Discrepancy type
2. Discrepancy date
3. Notes (optional)
Before you can handle any discrepancies in SAP TM, define the discrepancy types in Customizing,
Transportation Management -> Freight Order Management -> Define Discrepancy Profile
For Quantity-related discrepancies, we can define a discrepancy type having a tolerance range for “acceptable discrepancies” and assign it to the discrepancy profile.
You can enter the following tolerance limits in percent:
- Lower tolerance – This limit is used if the actual quantity is less than the planned quantity
- Upper tolerance – This limit is used if the actual quantity is greater than the planned quantity
The next step will be to assign the discrepancy profile to your Freight Order type
How to report and process a freight order with discrepancies
In the Freight Order, click on the Items tab and select the product, under item level details you can define the different types of discrepancies noticed.
If there is a discrepancy noticed between the planned quantities and the actual quantities, the actual quantity should be maintained in the Quantities tab -> Actual Quantities.
If the reported quantity discrepancy is within the predefined tolerance range maintained at the discrepancy type, the system does not set any blocks and the actual quantity should get updated to other subsequent documents
Other general discrepancies including damaged packaging of goods, dangerous good, etc can be reported in the Discrepancies tab under the product level.
Click on Insert and mention the appropriate Discrepancy type that needs to be reported. Multiple discrepancies can be reported for the same FO.
To resolve a freight order discrepancy just choose the discrepancy maintained and click on Resolve.
If you have reported a wrong discrepancy or the discrepancy was resolved by changing the quantity, you can click the Delete button to reset the discrepancies.
Depending upon the discrepancy type selected we can set blocks for the whole Freight Order and can hold further proceedings including Invoicing, execution, etc with the FO once the discrepancy is resolved. By strategically addressing and resolving discrepancies, businesses can ensure smoother freight order processes, avoiding disruptions to invoicing, execution, and other critical operations.
Author: Anoop A S
Anoop is a dynamic consultant with SCMYUGA Transportation Management practice and have been keen in delivering quality solutions to shipper clients. Watch out for more interesting blogs from him
