Broker Integration with SAP GTS

Hello everyone. Welcome to Espresso tutorial session on broker integration with SAP GTS. My name is Naresh Makhijani and I'm a solution director with cry based out of Seattle. I've been with Krypt for seven years now and I'm a global trade expert with 15 plus years of experience implementing SAP GTS and other ERP solutions.

For today's session, we'll be focusing on the broker enablement functionality, which comes out of the box in SAP GTS. Now, before I get into more details, let me give you a brief overview about, you know, who Krypt. So we are a leading technology firm based out of San Jose, California, and our focus has always been supply chain and global trade. We are experts in S A P G T S, transportation management, L B M I B P and E W M. Uh, over a period of time we have become a global, uh, firm with presence in Canada as well as in Europe as well. Apac, considering we are supply chain annex global trade experts over a period of time, we have focused on innovation as well where we have come up with quite a few innovative solutions. And just one solution that I want to highlight today is our artificial intelligence and machine learning based product called Kai, which would help you automate your product classification, both in the trade and supply chain. Now, without wasting too much time, let me get into the core of today's topic, which is our broker enablement solution.

So for those who are new to GTS, just let me give you a quick overview of what SAP Global Trade Services is all about. Now, SAP has provided a solution which will help you manage your trade and compliance by integrating with your ERP system. Now, it does come out of the box with quite a few focus on compliance, where we can manage the restricted party screening, classification, license management, manage your customs filing process, as well as manage your agreements as well. But for today, we are going to focus on the customs aspect where we are trying to see how GTS can help you manage your custom filing with brokers. Now, for those who are already using, um, brokers for their filing process, there are a couple of different options that come up with, uh, one option is like you print your documents and send it out to your brokers.

The other option is you can build a completely customized interface where you send your data electronically to the brokers in the format that the broker is really expecting. The other option that SAP GTS provides is where you can actually cell file by sending the data electronically to the customer authorities where SAP GTS is certified, and then you would basically get an approval or a rejection right away with, with the click of a button in your system. Now, what has happened over, the last couple of years is SAP has come up with a standard out of the box solution to help you communicate in a standardized way with brokers using web service. And why this was needed was, as I mentioned, there are options where you can build a custom interface with your brokers, but over a period of time it becomes extremely difficult to manage this as you will end up having numerous interfaces with numerous different file formats that you have to handle with each and every single broker in every single country. So the idea was to have one standardized way. This way there is less maintenance, there is more compliance because you will at the end get a complete visibility in terms of what the broker is doing with your filing process. Now, I know these a lot of options in terms of what you can do from a filing standpoint and, and typically what a customer ask me, you know, what options should I really go for? Now usually customers are customers are, well aware, aware of, you know, what options they would like.

But just to give a quick snapshot, uh, shot of what exactly these um, options are. If you go with paper-based, ideally it's used by cust companies who have a extremely low volume. You could go for self filing where you want to be more compliant, you want to have everything under your control and with more automation. And you'd have a good in-house presence as well who have expertise in customs as well. So if that's your, um, focus, then self filing would be an option.

And then there comes up with two options. One is a completely customized interface with your brokers based on the brokers, uh, way of communication, or you go with the standard broker enablement functionality, which is what I'm going to talk about today. So with GTS, there are two flavors to broker enablement. The first is the way that you can send your data from your system over to the broker system. So one, we call it as an importer centric scenario or you can also have an exporter centric scenario. The concept is the same, but I will just focus today on the importer centric scenario, just to give you that insight as to how this functionality really works.

So you could have your ECC system or you can also have your SAP S/4 system. For example, you will have all your transactions. Now, from an import standpoint, we are talking about shipping notifications or even a customs invoices. From an export standpoint, we are looking at a billing invoice, okay? So all the information will go into GTS, it'll sit in a work list. And from the work list you will be creating a customs declaration. So that is the part that you need to be ready with before you go ahead with your broker enablement functionality. Now, once that is in place, what you would be doing is sending the data electronically using web service over to the brokers. The brokers will then receive the data. It's basically a copy of, of the filing. They'll review it, they might just file the data as is, or they might just, or they might also update that information and then file with customer authorities. Once that is done, they will have the ability to send you an electronic copy back into GTS. Now what that means is I would know exactly what the broker has done with my data. Did they file the data as this or did they make changes to my data before filing with customs? This way I am more compliant, I have more visibility in terms of what the broker is doing with my data and before it gets updated in GTS, we do have an out of the box functionality to do some integrity checks on the data that is sent by the brokers before we update it in GTS. Okay? Now with this I will move into the technical setup. Now, there are a couple of options that you can come up with when it comes to SAP GTS The first option is you would have your custom declaration and you might say, okay, this is my data. Let's take the declaration request and send it out directly to the brokers, because GTS can have a web service connection and that you can integrate with brokers. But what I've seen over a period of time is lot of customers and are preferring to go with a middleware route because they do not want to expose SAP GTS to the outside world. That's more from a security standpoint, and that's the preferred architecture. So what happens is the data, which is a standard interface in GTS, the declaration request interface is sent over to the middleware. Now, one of the options that you can go for is the SAP PI or SAP PO would be a preferred middleware. It's going to be more of a pass through, okay? The only thing that will happen in the middleware is the decision-making process to decide where the data needs to be sent because you might have couple of brokers in each country. Okay? So based on the data and based on the routing logic that we work with the middleware team, the middleware team would know exactly where to send us data. And once the data is sent to the brokers, the brokers are going to come, come up with their activities, they will file with customs, maybe modify some data. Once it's all done and file successfully, we will be receiving the data back into G T s, again, goes through the firewall, comes in, and then it gets updated in the same declaration. But there is separate interface we call it as a declaration notification interface. Uh, the other beauty about this particular interfaces is, does gives you the ability to also receive the duties and taxes that brokers might have paid to the customs. So that is a separate tax assessment interface, but it still gets updated in your same import declaration. This way you would have a complete visibility even in terms of what duties or taxes you have you have paid. Just to give you a little bit more insight about this importer centric, functionality or even the, say, for example, exporter centric. As I said, the concept is the same. It's just a different screen for import versus export. For those who have already been using GTS, they're very much familiar in terms of where you can see your export declarations and where you can see your import declarations. But j but just to give a little bit more insight, once you go into the standard customs import declarations functionality, all you have to do is just execute, but make sure that you do not select the replicates. The checkbox of replicates is for a different functionality altogether, which I'll explain you in the coming slides as well. So you executed, you can see the information here. Over here in the bottom, you see the data actually sent from the GTS system or to the broker. Once the broker files, you will get a message back into GTS. That's a notification message, this is what has happened with my data. And you can actually see the data being received as well using web service. And once you also receive the data, you can also have the registration number or the item number or the confirmation number from customer authorities updated here, as well as you can also know what the broker's internal transaction number was as well. Along with that, there are a bunch of other details that usually we see getting, um, updated or replaced, which is in code dumps mode of transport and, and other transportation details that a compliance manager might require. Uh, additional visibility as well. Now the other piece to it is the tax assessment, which I also mentioned as part of the whole architecture. Now, once I have received the confirmation, now at any other stage, I can also receive a tax details. It need not happen at the same time because usually the tax details can come at a later stage. But what G T S does is with this functionality, you have a standard way of receiving the tax details, but it still gets tied up to your original import declaration. So over here you see another message coming in, which is IB002. That's the import duty statement message coming in from your brokers. And you, once you click on it, you will actually also have the visibility in terms of what type of duties have you paid or what, what type of duties the broker has paid on your behalf as well. So the next piece, which I also want to discuss is the broker centric scenario. Now, we discuss about importer centric. Now, excuse me. So what's the main difference between an importer centric and a broker centric, and where would this functionality really come in the picture? Now, there would be certain customers who would say that I can manage my export filing because I have more visibility in terms of shipment. I receive my, my billing invoice or my profile, my invoice from SS A P E R P come into that comes into GTS. You can go ahead with your export filing using the same export authentic functionality. And, but for importer functionality, many times what happens is the customers do not have visibility in terms of the data that they can send it to the brokers on time. Now, you might have that information, but it might come at, at a later stage, which is too late in the game from a filing standpoint. If, if you fall under that category and you still want to make sure GTS is the system of record, what you can do is you can let your brokers or your forwarders manage your customs filing using the paper-based documents. So they would receive these documentation as part of the pre-alert process, and once they receive that information, they will take that data and use that information to file the customs as well. Now, the only thing is you can send them as your product information, which includes the tariff codes, and basically the classification details so that when the broker is doing the filing, they will use your product classification information. So once they receive the paper documents, they will tap onto the product classification data, which resides in the system that you have sent to using web services. They will use the same classification file with customs. So that's where their original declaration recites in their system. And once this is done along with their duties, they will send you both the custom declaration copy along with the tax statement as well. So what will happen is in GTS, there'll be a replicate declaration created, and the tax statement will get updated on top of it. So it does give you that visibility, but the advantage that you have in this particular functionality is that you don't have to do anything from an import standpoint, keep your process as is the way you've been doing it, but still be compliant and get more visibility in your import filing process. From, from a a visibility perspective, how do you really proceed? In the GTS system? As I showed you earlier, this is a very similar screen, the same import declaration screen, but you need to select the replicate option, and this is what will happen Once you select it, you would see only those import declarations which fall under the replicate category, which basically means that you never send them any electronic data, but the broker send you the data using web service, which is a copy of the original declaration that they had in their system. What this basically means is now you have the visibility in terms of what was filed, and let's say you want, you review the data and you wanna send some information back or kind of have a two, two-way communication. You can still do it, you can send a feedback from, from your GTS system as a second message, it goes to the broker, and the broker can actually communicate, or you can still follow the traditional way saying, I have reviewed the data in my GTS system, and I am probably going to communicate through an email as well if that's, that's a preferred approach. The other thing is, which I also mentioned is the tax assessment. So the tax details which the broker has, uh, that you, that I also mentioned earlier in architecture, the broker can take the same tax information and send it back to you as form of a different interface, which is the tax assessment interface, and it'll sit in the same replicate, uh, declaration. Now, the beauty about this is you do not have to implement the tax in assessment, um, both ways. Um, like in the first scenario, if you are already implemented for the importer centric, you can just use the same interface again, for the broker centric. Uh, what I've seen with customers is that they usually go with both the scenarios. The preferred approach is to go with the importer centric, where you send the data electronically and let the broker use your data. The broker centric scenario is more of a fallback approach and use more of an exception for exceptions in some cases where you might not be able to send them the data on time, and then the broker will then say, I have the data using papers, uh, documents, which I received as part of the alert process, and I'm going to go ahead with the filing and send electronic data back. So it, again, it requires some further discussions on your side to see which scenario would be ideal, but we've seen customers going for a mix of both as well. Now, as I mentioned earlier, we do take care of the integrity checks as well. So once the broker sends your data, we do add a certain level of business rules. Now, this is on top of what standard SAP GTS might already take care of. Uh, some of the standard checks might be to see if the classification details are there in the file, uh, some, some additional mandatory information like the parts, uh, number or, uh, description and so forth. So it does take care of quite a few details. Let's say they use a part number, um, which does not exist in the SAP GTS system, so that is kind of a validation that the system already does, but they could be certain business rules that you want to, to add on top of what S A P G T S already offers. Uh, some of the business rules might be, uh, the SAP, the broker might have used a mode of transport, which is, or the broker basically forgot to add a mode of transport in the file. He might have still filed it, but he did not provide you that information. So you can say, I need that information. The broker has not given me this information because it's not a mandatory field from a GTS standpoint. So anything which is not mandatory, but you still want the brokers to add those as part of these integrated checks. Uh, they could also be something that, let's say the broker use a a particular tariff code, uh, in GTS, you might have a different, uh, tariff code for that particular product. Uh, the broker might have used a valid tariff code. It might be a perfectly valid chapter, but it's not the same classification that you have in your system. That case, you can say, my product classification in, in GTS system does not match with what the broker used for filing purposes. So that's a flag for you. It does not stop any processes in GTS. It is still a process. It's more of an information, it's an alert that gives, that tells you, this is what the broker has done with your data, and it is up to you to take the necessary actions based on these different messages that you might see in the system. Okay? Now, and you can basically define the level or the severity of these messages. Um, it's completely up to you whether you want to, uh, consider it as a red green or, yellow or maybe a high low medium as well, along with. So that is more of a severity that you can define to, to help you decide whether you really need to take actions on certain messages or not. Okay? Now the other, uh, part about this particular functionality is that it also gives you the visibility in terms of how your broker is performing. So, as I mentioned, these messages are coming in, the compliance manager is reviewing these messages, but at the same time, you also want to know how good your broker is performing. Is he really doing a good job in terms of the filing process or are they taking, uh, having too many mistakes done on their part? Like, uh, as I said, you are comparing your data with what they have filed, right? So that's, that's your best chance now to figure out how good or bad your broker is. And once you have those business rules added, you can actually rate your brokers. And then some of the KPIs that can be added is something which is very specific to you. Okay? So these are customer specific KPIs that we can define and that will help you evaluate your brokers over a period of time. Okay? Um, now for the broker enablement functionality, before, before we end, I also want to let you know is quite a few customers when they go with the web service journey, they have also gone ahead with a broker rationalization where they decide, okay, I have five or six brokers in one country. Um, and it's not practical to, to have web services built with every single broker. Now you could do it, but it, it takes time. Uh, you need to make sure your brokers are ready. So what typically major customers do is they go ahead with the rationalization where they say, I am going to have this type of, uh, communication with my top two or top three brokers. And how, what will happen in that scenario is if you decide your top two or top three, maybe you can give them more volume and then tell them that, okay, I'm going to give you everything electronically. This way there is less time spent on their part from a filing standpoint, and they would give you a better filing, charges just because of extra volume and now that you are going to send them data electronically. So that's what typically, customers usually go for as part of the broker rationalization. And as part of this exercise, one key thing that you need to ask your brokers is, do your brokers really support web service? Um, now as I said earlier, there could be customized way web service is a preferred approach because that is a standard out of the box functionality in GTS. But if, if, let's say for some reasons you are not comfortable using web service, you can always go with a different form of communication, but then that means that you will have to manage different communication standards every now and then when you deal with your brokers. It's, always ideal that every single broker listens to your standard of communication. But again, the system does give you the flexibility to handle any side sort of communication. Okay. So with this, we come to an end, uh, for the, on this presentation. Uh, happy to answer any questions, but if, if you have any, uh, additional doubts, please feel free to reach out, uh, to me on my email address.