ERP / SAP Overview

08/12/24 ERP / SAP Overview

 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 ECC Overview.
• Identify the different SAP ECC Functional modules/areas.
• Distinguish the components of SAP ECC.
• Judge the use of ABAP programming language.

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ERP Overview

Enterprise Resource Planning

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 Enterprise Resource Planning
... synchronization of Company functions...

Purchase

Manufacturing Finance

Sales

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 Enterprise Resource Planning
… and extended to the complete value chain...

Tier I Component
Manufacturer

Vehicle OEM

Tier II Component
Supplier

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 Enterprise Resource Planning
... delivering administrative and decision support with...

Decision support and

analysis

Processes monitoring &

feedback

Administrative
registration

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 What is an ERP solution...?
…Integrated across the primary and support processes
Distribution

Manufacturing Marketing

Planning
Materials and Finance
Execution

Engineering Sales

Human Resources
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 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

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 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 !!!

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 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.

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 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.

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 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 Manufacturing Transportation Distribution Delivery Customer Consumer

Logistics

Logistics and Distribution Sales & Customer Service

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 Major ERP vendors
 SAP ECC
 Oracle ( Peoplesoft and JD Edwards were independent ERP venders earlier,
but are subsets of Oracle now )
 Peoplesoft
 JD Edwards

 Baan

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 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 ERP
 Improved quality of life

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SAP ECC Overview
 Systems Applications & Products

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 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

 Worldwide presence in over 50 countries

 18,000+ employees
 Trained consultants doubled since 1996 (40,000)

 About 20,000 companies in 120 countries

 Around 64,500 installations of SAP

 Strength lies in its high degree of integration, mainly for large, global corporate
enterprises

 Significant presence in Global Fortune 500 companies

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 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

 Reorganized as leading mainframe software for large multinational
R/2
corporations
Basis System
 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 ECC

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SAP ECC : Latest Release

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SAP ECC : Latest Release (Contd.)

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SAP R3E and mySAP.com

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SAP NetWeaver

Existing Systems
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 SAP ECC : 3 Tier Architecture
The Presentation Layer
Those SAP ECC software components that
specialize in interacting with end-users
form the Presentation Layer.

The Application Layer

Those SAP ECC software components that
specialize in processing business
applications form the Application Layer.

The Database Layer

Those SAP ECC software components that

specialize in the management , storage and
retrieval of data form the Database Layer

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 SAP ECC : 3 Tier Architecture

Presentation Layer Application Layer Database Layer

components components components

reside in: reside in: reside in:

Presentation servers: Application servers: Database servers:

Systems capable of Specialized systems Specialized systems
providing a graphical multiple CPUs and with fast and large
interface. vast amounts of RAM. hard drives.

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 SAP ECC : 3 Tier Architecture
Presentation Layer components are installed across many PCs

The Application Layer

components are installed
across one or more high-
end servers.

The Database Layer

components are installed on
high-end database server.

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SAP ECC Overview
SD FI
Sales & Financial
Distribution Accounting
MM CO
Materials Controlling
Mgmt.
PP
Product
ECC TR

Planning Treasury

Client/Server
QM ABAP/4 PS
Quality Project
Mgmt. System
PM WF
Plant Mainte- Workflow
nance
HR IS
Human Industry
Resources Solutions

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

SAP R/3
Workflow
S C
U U
P S
P Procurement Production Distribution T
L MM PP SD O
I M
E Finance and Accounting E
R FI CO R

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SD: Sales and Distribution

SAP
ECC

SD Sales & Distribution . . . . . . . .

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Order Entry
PP
FI MM FI

Credit Management
Dynamic Availability Check
Cash Forecast

?
OK

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Delivery/Shipment Processing

FI MM
WM
Ship to party: C100
MM
Item Material Qty
10
20
6301
6412
10
10 Credit Management
30 . 1507 25
.
.
Delivery
.
Note Static Availability Check

Picking
List

Picking
Packing
Transportation
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 Picking/Packing
Sales
Sales Order
Order

Delivery
Delivery

Picking without Picking Picking with Picking

Confirmation Confirmation
Picking
Picking
Print
Print Picking
Picking List
List Request
Request

Confirm
Confirm Picking
Picking Picking
Picking
Request
Request Confirmation
Confirmation

Goods
Goods Issue
Issue

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Invoicing
CO
PA
CO
PCA
Profit Center Accounting/Profitability Analysis FI
FI
Accounts Receivable/General Ledger

Cash Forecast

Single Invoices
Collective Invoices
EDI
Invoice Lists
Credit/Debit Notes

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SAP ECC : Components
Master Data
Application
Transaction Data

ABAP
Programs

Organization Structure

Configuration Key Data Elements

Functionality Configurations

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 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

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 ABAP Programming
 SAP ECC applications are written in the ABAP programming language, and
run within the application layer of the ECC 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.

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