SAP was founded in June 1972 as Systemanalyse und Programmentwicklung ("System Analysis and
Program Development") by five former IBM engineers in Mannheim, Germany. The acronym was later changed to stand for Systeme, Anwendungen und Produkte in der
Datenverarbeitung ("Systems, Applications and Products in Data
Processing").
When you are referring to the company SAP, pronounce it as “ESS-AYY-PEA”. The word sap has an altogether different meaning of itself when combined with other words like “tree sap”. Saying "sap" is the surest way to say, "I don't know anything about SAP."
SAP ERP is SAP AG's Enterprise Resource Planning, an
integrated software solution that incorporates the key business functions of
the organization. SAP ERP consists of
several modules, including utilities for marketing and sales, field service,
product design and development, production and inventory control, human
resources, finance and accounting. SAP ERP collects and combines data from the
separate modules to provide the company or organization with enterprise
resource planning.
The main purpose of an SAP system is to provide a highly integrated, large-scale business applications to manage all the business data. A few of these can be
seen at
the top of Figure. The standard set of applications
delivered with each SAP system are the following:
- · PP (Production Planning)
- · MM (Materials Management)
- · SD (Sales and Distribution)
- · FI (Financial Accounting)
- · CO (Controlling)
- · AM (Fixed Assets Management)
- · PS (Project System)
- · WF (Workflow)
- · IS (Industry Solutions)
- · HR (Human Resources)
- · PM (Plant Maintenance)
- · QM (Quality Management)
These applications are called the functional areas, or the functional modules of SAP. Previously, a business organization had to purchase different business suites for its different departments needs. As these different business suites are from multiple vendors Interfaces are then needed between them. For example, the Production Planning department needs the data from the material management department and the finance system will need links from the HR system. A significant amount of time and money is spent in the implementation and maintenance of these interfaces.
To overcome the above stated problem SAP ERP was introduced which comes with all the common business application required by most of the organizations. These applications coexist in one homogenous environment. They are designed from the ground up to run using a single database and one (very large) set of tables.
There are various ERP software (PeopleSoft, Oracle Fusion
etc) available in market today, but SAP owns the major stake of an around 90%
of it. The main reason for Popularity of SAP is that SAP have a very high level
of integration among its individual applications which guarantee consistency of
data throughout the system and the company which implements SAP. Potential
benefits include efficient business process, inventory reduction, and lead time
reduction.
Benefits brought by
the SAP
- Information Integrity
- Single entry point for information
- Simultaneous processing of inputs from various users
- Automatic updating of the database
- Common Data Base
- Operational aspects, financial and management are satisfied simultaneously
- The use of common database involves the integrity of data and the lack of activities for maintenance of data consistency. The whole company will talk the same language. The update online information promotes greater agility and flexibility in the work.
- Faster time to serve customers, external and internal.
- Smaller rework-integration between people and information.
- Point of contact for customers
- Easier to measure results
- Optimization of costs.
SAP ERP History
The Software SAP ERP was mainly developed for Automobiles
industry. The reason for development of SAP software is because the automobile
industries have their plants in various parts of world. Thus, to maintain the
integrity of data of the overall organization SAP ERP was introduced.
The first version of SAP's flagship enterprise software was
a financial Accounting system named R/1 called as YSR. This was replaced by R/2
at the end of the 1970s. SAP R/2 was in a mainframe based business application
software suite that was very successful in the 1980s and early 1990s. It was
particularly popular with large multinational European companies who required
soft-real-time business applications, with multi-currency and multi-language
capabilities built in. With the advent of distributed client–server computing
SAP AG brought out a client–server version of the software called SAP R/3 (The
"R" was for "Real-time data processing" and 3 was for
3-tier). This new architecture is compatible with multiple platforms and
operating systems, such as Microsoft Windows or UNIX. This opened up SAP to a
whole new customer base.
SAP R/3 was officially launched on 6 July 1992. It was
renamed SAP ERP and later again renamed ECC (ERP Central Component). SAP came
to dominate the large business applications market over the next 10 years. SAP
ECC 5.0 ERP is the successor of SAP R/3 4.70. The newest version of the suite
is SAP ECC 7.0.
what is the advantage of SAP..?
ReplyDelete
DeleteHi Rahil,
-SAP provides a very high level of integration among its individual applications which guarantee consistency of data throughout the system.
-SAP comes prepackaged with the core business applications, like creating sales order, purchase order etc. So the business organizations have to just customize SAP as per their business requirements.
-It’s highly configurable, highly secure data handling, min data redundancy, max data consistency, Easier to measure results etc.
Having said that, you won't be able to realize the advantage of SAP at a lower level. To understand it better let's consider an example.
There is a company which manufactures Cars. The company has its manufacturing plant in Gujarat, material management department in Gurgaon and sales department all over India. If a customer wants to place a order of say 500 cars he visits any of the sales outlet and enquires about it. Now the company has not yet implemented SAP and its various departments exchanges data every 15 days. The Sales representative then confirm from its production department that they have 300 cars readily available and sufficient material to build another 200. So the representative promises customer to deliver 300 cars in 1 month time and another 200 in a span of 4 months and takes the Advance cash. The order to manufacture these 200 cars goes to the Production department @ Gujarat. The production department than asks for material to material management department. Now the Problem arises when The material management department checks their database and finds out that they don't have sufficient material to build another 200 cars and it would require 2 months to import all the necessary parts and hence delay in the order delivery. This thus results in customer dis-satisfaction, impact on revenue, improper resource utilization etc.
Now if the company would have implemented SAP, the sales department would have informed production department about the order, the production department then after checking their database which is now synchronized with material management database would asked for more time delivery or anything. Moreover the company could have also prepared itself for a huge order or any adhoc requests as SAP enables them to track their resources.
Hope it answers your Query. If not feel free to ask.
Hi.. I am a graduate in Computer Science and Engineering.. I am interested in SAP but dont knw how to select the stream.. please help me..
ReplyDeleteHii..
ReplyDeleteI am working in a MNC from past 2 years and i worked more on PLSQL part. And i would like to learn and continue my career with SAP. So Please suggest me the suitable module and which is also have good value in current market.
Regards
Suneel Kumar
hiii sap ep is best for future or not im a mca student
ReplyDeletecan u guide me plz