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SAP Overview

ATOZ Soltech, Coimbatore.

Objectives
The participants will be able to:
Recognize the evolution of ERP solutions. Appraise the concept, benefit and use of ERP solution. Define the SAP R/3 Overview. Identify the different SAP R/3 Functional modules/areas. Distinguish the components of SAP R/3. Judge the use of ABAP programming language.

ERP Overview

Enterprise Resource Planning

Enterprise Resource Planning


... synchronization of Company functions...

Purchase

Manufacturing

Finance

Sales

Enterprise Resource Planning


and extended to the complete value chain...

Tier I Component Manufacturer

Vehicle OEM

Tier II Component Supplier

Enterprise Resource Planning


... delivering administrative and decision support with...

Decision support and analysis

Processes monitoring & feedback

Administrative registration

What is an ERP solution...?


Integrated across the primary and support processes
Distribution

Manufacturing

Marketing

Materials

Planning and Execution

Finance

Engineering

Sales Human Resources

The ERP application


An integrated suite of business applications, which..
Closely links, monitors, and controls primary enterprise resources like manpower, machine, material, methods, market and money. Enables corporates to readily change their processes to adapt to the ever changing business scenario. Provides expertise in industry specific business processes.

Entails
Parameterization / Configuration

Designing & Customization


Testing and Implementation Training

Why clients buy ERP?


Corporate Initiatives
Strategic initiatives
A requisite capability in a competitive global business

Operational initiative
A foundation for performance and cost improvement via integration

Organizational initiative
To initiate a major organizational change within the company

Technology
IT is making the transition from a supporting operational entity to becoming a strategic competitive tool.

Because others are buying it !!!

Recent business trends favoring ERP growth


Business Process Reengineering ( BPR )
Most large companies are attempting to cut in-house development costs, improve customer service, and speed products to market by reorganizing their existing business processes.

Software Pricing
Licensing and pricing of mainframe based packaged applications are tied to the size of mainframe system on which the applications run, but now customers are now demanding user-based licensing options and major corporate applications like SAP provide this instead of the conventional platform-based pricing technique.

Recent business trends favoring ERP growth


Globalization
As businesses are becoming more global in scope, people are demanding packaged corporate applications that are available in a variety of languages with support for multiple currencies.

Integration
As more and more companies are going for BPR, there is increase in demand for integrated solution e.g.. different applications sharing a common database and thus enabling data definitions and business rules to be applied across an entire organization with the facility of doing modifications at one location only.

Business process benefits clients expect from an ERP project


Global process/ Product management Integrated Supply Chain Management Leverage purchasing and vendor management Order cycle time/ customer service improvement Inventory reductions Reduced information systems costs on an ongoing basis Improved business management through worldwide integration and information

Vendors

Inbound Logistics

Manufacturing

Transportation Distribution

Delivery

Customer

Consumer

Logistics and Distribution

Sales & Customer Service

Major ERP vendors


SAP R/3 Oracle ( Peoplesoft and JD Edwards were independent ERP venders earlier,
but are subsets of Oracle now ) Peoplesoft JD Edwards

Baan

What results can be expected from an ERP culture?


Reduced working capital requirements Improved customer service Improved direct labor productivity Reduced purchase costs Reduced obsolescence Reduced overtime Having the figures to make decisions Having accountability throughout the organization Improved quality of life

ERP

SAP R/3 Overview

Systems Applications and Products in Data Processing

SAP AG At a Glance
Founded in Germany in 1972 Market Leader in Industrial Enterprise Application (IEA)
About 56% market share in the ERP market.

Employs more than 38,400 people in more than 50 countries.

As the world's third-largest independent software provider, SAP delivers business solutions to more than 36,200 customers in more than 120 countries around the world.
Strength lies in its high degree of integration, mainly for large, global corporate enterprises Significant presence in Global Fortune 500 companies

SAP R/1 , R/2


The R/1 system
Developed for ICI Chemical Released 1972 Focused on Sales & Distribution and Materials Management Discontinued after release of R/2

The R/2 system


R/2 Basis System

Reorganized as leading mainframe software for large multinational corporations No sales effort planned reactive only 4,300 copies worldwide in 1993 Mainframe-based to replace user legacy software; co-existence and migration strategy underway for R/2 and R/3 Keeping in mind its multinational customers, SAP designs SAP R/2 to handle different languages and currencies.

Note: "R" stands for real-time data processing.

SAP R/3 : 3 Tier Architecture


The Presentation Layer Those SAP R/3 software components that specialize in interacting with end-users form the Presentation Layer.

The Application Layer Those SAP R/3 software components that specialize in processing business applications form the Application Layer.

The Database Layer


Those SAP R/3 software components that specialize in the management , storage and retrieval of data form the Database Layer

SAP R/3 : 3 Tier Architecture

Presentation Layer components reside in:

Application Layer components


reside in:

Database Layer components reside in:

Presentation servers: Systems capable of providing a graphical interface.

Application servers: Specialized systems multiple CPUs and vast amounts of RAM.

Database servers: Specialized systems with fast and large hard drives.

SAP R/3 : 3 Tier Architecture


Presentation Layer components are installed across many PCs

The Application Layer components are installed across one or more highend servers. The Database Layer components are installed on high-end database server.

SAP R/3 Overview

SD

FI Financial Accounting CO Controlling

Sales & Distribution


MM PP Materials Mgmt.

Product Planning

R/3
Client/Server ABAP/4

TR Treasury

QM Quality Mgmt. PM

PS Project System WF Workflow IS

Plant Maintenance HR
Human Resources

Industry Solutions

SAP R/3 Overview

SD MM PP

FI CO

R/3
Client / Server ABAP/4
PM HR IS WF

AM

QM

PS

Integration
MRP Requirement on component level Purchase Order Goods Receipt Invoice Verification

Planned Requirement

PP
Customer Order

SD

MM

Planned Order Production Order

Shipping

Invoicing

Production completed

Account Receivable

CO
Order Settlement

FI

FI
Accounts Payable

Which modules are involved?

Integration
All business processes throughout the supply chain are executed in one system sharing all information

SAP R/3
S U P P L

Workflow

C U S

Procurement MM

Production PP Finance and Accounting

Distribution SD

T O

I E R

M
E
CO FI

Accelerated SAP - SAP Implementation Methodology

Mapping of business processes Proven approach Reduced costs Ensured quality and know-how transfer Efficient use of resources Reusable for subsequent implementation phases

mySAP Technology

SAP NetWeaver

Existing Systems

SAP R/3 : Components


Master Data Application

Transaction Data

ABAP Programs

Organization Structure
Configuration Key Data Elements Functionality Configurations

What is Customization ?
Customization
The adaptation of application software to customer-specific needs is accomplished in two ways :

Coding
Programming customer-specific code that replaces or complements components of the application

Configuration
Rendering the application appropriate to a specific customer by specifying data on which the application operates

ABAP Programming
SAP R/3 applications are written in the ABAP (Advanced Business Application Programming) programming language, and run within the application layer of the R/3 System.
ABAP programs communicate with the database management system of the central relational database (RDBMS), and with the graphical user interface (SAP GUI) at presentation level.

Why do we need ABAP Development ?

SAP R/3 scope

SAP Solution

SAP R/3 scope

Specific company requirements

SAP Solution

SAP R/3 scope

Specific company requirements

New Functionality Development

Non SAP applications

Summary
Materials Requirement Planning (MRP-I) began as a technique for developing enterprisewide business solutions by providing automated tools for forecasting demands and planning according to the forecast. ERP is an integrated suite of Applications to meet corporate needs. Some major ERP vendors are : SAP R/3, Oracle, Baan SAP AG was founded in Germany in 1972 and it is a Market Leader in Industrial Enterprise Application (IEA). SAP NetWeaver is a vision, or paradigm, of total integration of :
People Information Business Processes Applications

SAP has a 3 tier architecture comprising of the Presentation layer, Application layer and the Database layer. The SAP solution is divided in different areas or Functional Modules like SD, MM, PP, QM, PM, FI, CO etc. which are reorganized under services in mySAP Business Suite. R/3 applications are written in the ABAP programming language, and run within the application layer of the R/3 System.

Questions
What is MRP ?

What is ERP ?
When was SAP AG founded ? What are the 3 layers of the SAP R/3 ? What is SAP Netweaver ?

What are the different functional modules of SAP ?


What programming language is used for SAP applications ? Why do we need ABAP developments ?

Thank You