Importance of SAP for Modern Business

8/6/2019 Importance of SAP for Modern Business

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SIMPLIFY, OPTIMIZE, ANDINNOVATE WITH SAP ERP

By

Amit M. RampureAbhishek Goyal

Khalid


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Index

1. Introduction03

2. Objectives...04

3. Scope..05

4. SAP09

i. Evolution

ii. Products

iii. SAP Today

5. SAP R/3..12

i. Structure

6. SAP ERP18

7. SAP Enterprise SOA/NetWeaver...20

8. Implementation of SAP..22

9. Conclusion..31

10. Bibliography...33


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1. Introduction

There has always been a lot of buzz around ERP and the value it brings to

businesses. But what exactly is ERP? How does it benefit businesses? Some have dubbed

it "the operating system for business; sounds a lot better than "ERP. Whatever you call

it, it's easy to see the charm of Enterprise Resource Planning. A well-integrated ERP

system manages all sorts of back-office functions, from payroll and human resources to

finance, procurement, manufacturing and logistics. It connects all those departments with

supply chain and customer management applications. And it helps businesses share

information both inside and outside the company in the most effective manner...

However, the ERP system was not always the fast growing form of managingbusinesses that it is today. There were many systems before SAP and other ERP systems

that would help in managing the various functions of a business. The introduction of ERP

systems into business management was a revolution that is rapidly on the rise today. Over

the past four decades, since the inception of ERP, this new system of management has

been growing and is now fast eclipsing the other known forms of integrating and

managing any business, be it a large enterprise or a small startup business. The reason for

this success is simple: Over the past decades ERP has managed to adopt and adapt itself

to the ever changing needs of business. As e-business and e-commerce have evolved,

ERP has evolved with it.


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2. OBJECTIVES

SAP was founded in 1972 as Systems Applications and Products in Data Processingby

five former IBM engineers Dietmar Hopp, Hans-Werner Hector, Hasso Plattner,

Klaus Tschira, and Claus Wellenreuther. Today, SAP is the recognized leader in

providing collaborative business solutions for all types of industries and for every major

market. SAP software has been developed to be modular, scaleable, open and flexible,

allowing companies to tailor it specifically to their needs to provide up-to-the-minute,

real-time information. SAP provides integration tools and methods for linking legacy and

distributed systems as well as a host of third party software solutions, to get your

information into the right hands, internally and externally.

SAP ERP addresses the core business software requirements of the most

demanding midsize and large organizations in all industries and sectors. Simplified

SAP ERP user interfaces help ensure employee productivity by providing quick access to

critical processes and information. SAP has also developed the SAP NetWeaver platform,

which allows our customers to achieve more value from their IT investments. We will

attempt to trace some of the history of its evolution.

But, what exactly is SAP? Why is it that today many business prefer SAP over

other ERP systems? What makes SAP so successful? How is it used and implemented?

What is its scope in a business? In this article, we will attempt to answer these and other

related questions.


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3. SCOPE

To understand any ERP we should understand first business process without

ERPs and change in business process with ERP and also change in way ofconducting business

To understand this better let us take the example of a company whichmanufactures cars. We have a common scenario where a customer calls in toplace the order for a car. We examine the process first without ERP system andthen see how all the functions can be integrated with SAP.


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Here we can see the evident confusion when a customer has placed the orderand each individual department processes the order according to their prioritieswithout keeping in mind the whole picture. As a result this is usually the outcome:

End result: One customer lost. One customer lost means 10 customers lost andbusiness opportunity lost.


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However when we integrate this very business with and ERP system likeSAP, the end result is always a very satisfied customer resulting from the work ofan organization which works like a well oiled clock.

Business with ERP

MFG

MARKETING PURCHASE

HRPP

FINANCE

PLANTS

QUALITY

ASSETS

MAINTENANCE

WAREHOUSESSALES

PROJECTS

CONTROL

INSURANCE

SHOP

FLOOR


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Some Facts about SAP:

Currently, more than 12 million users work each day with SAP solutions.

There are now 121,000 installations worldwide, more than 1,500 SAP partners.Over 25 industry-specific business solutions.

More than 41,200 customers in 120 countries.

SAP employs more than 41,900 people in more than 50 countries.

SAP is the world's third-largest independent software vendor. Worlds largest business

software company.

These facts show the importance of the ERP and also the SAP as ERP package. The

managers and employees working in the organizing use SAP ERP to do business

transactions with ease. SAP integrates all functions of organization. We shall further

examine the nature and scope of SAP for a business in the next few topics.


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4. SAP

i. Evolution of SAP

1. The 1970s: A Real-Time Vision

Five former IBM employees Dietmar Hopp, Hans-Werner Hector, Hasso Plattner, Klaus Tschira, and Claus Wellenreuther - launch a company called Systems,Applications, and Products in Data Processing in Mannheim, Germany. One yearlater, the first financial accounting software is complete; forming the basis for thecontinuous development of other software components in what later came to beknown as the "R/1 system (R stands for real-time data processing.)

2. The 1980s: Rapid Growth

SAP moves into the company's first building on Max-Planck-Strasse in an industrialpark in Walldorf, near Heidelberg. The SAP R/2 system attains the high level ofstability of the previous generation of programs. Keeping in mind its multinationalcustomers by the middle of the decade, SAP founds its first sales organizationoutside Germany, in Austria. Revenues reach DM 100 million (around $52 million),earlier than expected. With the founding of subsidiaries in Denmark, Sweden, Italy,and the United States, SAP's international expansion takes a leap forward.

3. The 1990s: A New Approach to Software and Solutions

SAP R/3 is unleashed on the market. The client-server concept, uniform appearance

of graphical interfaces, consistent use of relational databases, and the ability to runon computers from different vendors meets with overwhelming approval. With SAPR/3, SAP ushers in a new generation of enterprise software - from mainframecomputing to the three-tier architecture of database, application, and user interface.To this day, the client-server architecture is the standard in business software. By1996, the company has earned 1,089 new SAP R/3 customers. At the end of the year,SAP R/3 has been installed in more than 9,000 systems worldwide.

4. The 2000s: Innovation for the New Millennium

With the Internet, the user becomes the focus of software applications. SAP develops

SAP Workplace and paves the way for the idea of an enterprise portal and role-specific access to information. Today, with enterprise services-oriented architectureand the underlying integration and application platform, SAP NetWeaver, SAP isproviding customers with solutions for end-to-end business processes. With SAPNetWeaver, any company can integrate people, information, and processes within thecompany and beyond.


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ii. Products

SAP's products focus on Enterprise Resource Planning (ERP), which it helped topioneer. The company's main product is SAP ERP. The name of its predecessor, SAP R/3gives a clue to its functionality: the "R" stands for realtime, the number 3 relates to a 3tier client-server architecture (database layer-application layer-presentation layer) 3-tierarchitecture: database, application server and client (SAPgui). R/2, which ran on aMainframe architecture, was the first SAP version.

Other major product offerings include Advanced Planner and Optimizer (APO),Business Information Warehouse (BW), Customer Relationship Management (CRM),

Supply Chain Management (SCM), Supplier Relationship Management (SRM), HumanResource Management Systems (HRMS), Product Lifecycle Management (PLM),Exchange Infrastructure (XI), Enterprise Portal (EP) and SAP Knowledge Warehouse(KW).

The APO name has been retired and rolled into SCM. The BW name (BusinessWarehousing) has now been rolled into the SAP NetWeaver BI (Business Intelligence)suite and functions as the reporting module.

The company also offers a new technology platform, named SAP NetWeaverwhich replaces SAP Business Connector for Integration/middleware capabilities and

offers a systematic approach to Enterprise SOA solutions with a collection of products.While its original products are typically used by Fortune 500 companies, SAP is now alsoactively targeting small and medium sized enterprises (SME) with its SAP Business Oneand SAP All-in-One.

SAP officials say there are over 100,600 SAP installations serving more than41,200 companies in more than 25 industries in more than 120 countries.


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iii. SAP Today

SAP Headquarters in Walldorf, Germany

SAP is the world's largest business software company and the third-largestindependent software provider in terms of revenues. It operates in three geographicregions EMEA, which represents Europe, Middle East and Africa; the Americas, whichrepresents both North America and Latin America; and Asia Pacific Japan (APJ), whichrepresents Japan, Australia and parts of Asia.

SAP focuses on six industry sectors -- Process industries, Discrete industries,Consumer industries, Service industries, Financial services, and Public services. It offersmore than 25 industry solution portfolios for large enterprises and more than 550 micro-vertical solutions for midsize companies and small businesses.

SAP holds a partnership with Hewlett-Packard. This partnership will expandaround new services linked to NetWeaver and Enterprise SOA (service-orientedarchitecture). The software infrastructure for business applications developed by SAP isto be upgraded by Hewlett-Packard. One of the services to be upgraded is the DiscoverySystem which was launched by SAP earlier this year.

SAP competitors are primarily in the Enterprise Resource Planning Softwareindustry. SAP also competes in the Customer Relationship Management, Marketing &Sales Software, Manufacturing, Warehousing & Industrial Software, and Supply ChainManagement & Logistics Software sectors and include Oracle and IBM.


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SAP R/3 Architecture

SAP R/3 functionality is structured using its own proprietary language called

ABAP (Advanced Business Application Programming). ABAP, or ABAP/4 is a fourth

generation language (4GL), geared towards the creation of simple, yet powerful

programs. R/3 also offers a complete development environment where developers can

either modify existing SAP code to modify existing functionality or develop their own

functions, whether reports or complete transactional systems within the SAP framework.

ABAP's main interaction with the database system is via Open SQL statements.

These statements allow a developer to query, update, or delete information from the

database. Advanced topics include GUI development and advanced integration with other

systems. With the introduction of ABAP Objects, ABAP provides the opportunity to

develop applications with object-oriented programming.

The most difficult part of SAP R/3 is its implementation. Simply because SAP

R/3 is never used the same way in any two places. For instance, Atlas Copco can have a

different implementation of SAP R/3 from Procter & Gamble and so forth.


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Two primary issues are the root of the complexity and of the differences:

Customization configuration - Within R/3, there are tens of thousands of database

tables that may be used to control how the application behaves. For instance, each

company will have its own accounting "Chart of Accounts" which reflects how its

transactions flow together to represent its activity. That will be specific to a given

company. In general, the behavior (and appearance) of virtually every screen and

transaction is controlled by configuration tables. This gives the implementor great

power to make the application behave differently for different environments. With

that power comes considerable complexity.

Extensions, Bolt-Ons - In any company, there will be a need to develop interface

programs to communicate with other corporate information systems. Thisgenerally involves developing ABAP/4 code, and considerable "systems

integration" effort to either determine what data is to be drawn out of R/3 or to

interface into R/3 to load data into the system.

SAP has several layers. The Basis System (BC) includes the ABAP programming

language, and is the heart (i.e. the base) of operations and should not be visible to higher

level or managerial users. Other customizing and implementation tools exist also. The

heart of the system (from a manager's viewpoint) are the application modules. These

modules may not all be implemented in a typical company but they are all related and are

listed below:


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R/3 Modules

SAP R/3 is arranged into distinct functional modules, covering the typicalfunctions in place in an organization. The most widely used modules are Financials andControlling (FICO), Human Resources (HR), Materials Management (MM), Sales &Distribution (SD), and Production Planning (PP). Those modules, as well as theadditional components of SAP R/3, are detailed in the next section.

Each module handles specific business tasks on its own, but is linked to the otherswhere applicable. For instance, an invoice from the Billing transaction of Sales &Distribution will pass through to accounting, where it will appear in accounts receivableand cost of goods sold.

Financial Accounting (FI):

Designed for automated management and external reporting of general ledger,accounts receivable, accounts payable and other sub-ledger accounts with a userdefined chart of accounts. As entries are made relating to sales production and paymentsjournal entries are automatically posted.

Human Resources (HR):

Complete integrated system for supporting the planning and control of personnelactivities and HR module is sometimes equivalently referred as HCM (Human

Capital Management).

Materials Management (MM):

Supports the procurement and inventory functions occurring in day-to-day businessoperations such as purchasing, inventory management, reorder point processing,etc.

1. Quality Management (QM):

A quality control and information system supporting quality planning, inspection,

and control for manufacturing and procurement.

Sales and Distribution (SD):

Helps to optimize all the tasks and activities carried out in sales, delivery andbilling. Key elements are: pre-sales support, inquiry processing, quotation processing,sales order processing, and delivery processing, billing and sales information system.


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PP Production Planning (PP):

Used to plan and control the manufacturing activities of a company. This module

includes; bills of material, routings, work centers, sales and operations planning,master production scheduling, material requirements planning, shop floor control,production orders, product costing, etc.

Environmental Health & Safety (EH&S):

Designed for the management of environmental regulatory information,particularly product safety data as required for Material Safety Data Sheets.

EH&S has sub-modules of Product Safety, Dangerous Goods, Waste, Industrial Hygiene,and Occupational Health.

2. Controlling (CO):Represents the company's flow of cost and revenue. It is a managementinstrument for organizational decisions. It too is automatically updated as eventsoccur.

3. Asset Management (AM):Designed to manage and supervise individual aspects of fixed assets includingpurchase and sale of assets, depreciation and investment management.

4. Plant Maintenance (PM):Equipment servicing and rebuilding. These tasks affect the production plans.

5. Project System (PS):Designed to support the planning, control and monitoring of long-term, highlycomplex projects with defined goals.

6. FS Insurance :An integral part of mySAP ERP, SAP for Insurance enables insurance

companies to handle customer and market requirements and simultaneously controlprofitability and economic viability

7. Supply Chain Management (SCM)

8. Strategic Enterprise Management (SEM)


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9. Warehouse Management (WM):

Subdivides the "Storage Location", which is used in the MM Module to defineinventory values by location, into "Storage Types" and then into "Storage Bins".Control of stock to a physical level down to a warehouse bin. Placement and removalrules can be configured, stock counts can be done.

10. Handling Unit Management (HUM):

Used as a unique ID for each pallet of stock held in the warehouse.

11. Advanced Forecasting & Replenishment (AF&R):

Mostly referred to as Forecasting & Replenishment.


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6. SAP ERP

The SAP ERP application is the follow-up product to SAP R/3 software.

SAP ERP is the target release for customers considering upgrades of their current

SAP R/3 software.The latest ERP solution from SAP delivers significant product

enhancements for financial management, human capital management,

procurement and logistics, product development and manufacturing, sales and

service, and other corporate services.

In addition, SAP ERP is powered by the SAP NetWeaver platform, a

composition platform that allows organizations to build new business solutions

rapidly while realizing more business value from existing IT investments. SAP

NetWeaver supports new cross-functional business processes, helping lower your

total cost of ownership by reducing the need for custom integration and offering

complete life-cycle management for your applications. As the foundation for

enterprise service-oriented architecture (enterprise SOA), it helps align people,

information, and business processes across organizational and technological

boundaries.

SAP ERP has the following advantages over R/3:

Enhanced Financial Management, Analysis, and Reporting Functionality

A newly architected general ledger solution that lessens manual

reconciliations and improves the ability to balance ledgers by multiple dimensions

Improved management dashboards that provide a complete picture of

business operations and improve decision making among managers and line-of-

business users

New collections and credit management functionality to accelerate cash

collections and improve day-sales-outstanding metrics

Enhanced Human Capital Management Functionality

End-to-end talent management tools to improve recruiting, training,

performance evaluation, and retention of employees

Improved employee self-service functionality to reduce administrative

overhead of HR departments


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Improved employee expense and travel reporting to reduce the time and

improve control over employee expense reimbursements

Enhanced Support for New Business Models and Operations

Improved architecture to support outsourcing for payroll and cash

management

New ability to support electronic procurement, invoicing, sales order

management, and documentation of internal controls for the U.S. Sarbanes-Oxley

Act

Enhanced enterprise services repository for system and instance

consolidation and shared-service management

Serving a Broad Business User Community

Empowered users through enhanced functionality to connect people

directly to processes leveraging the specific role-based user interface

Improved business insight through expanded SAP xApp Analytics.


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7. SAP Enterprise SOA/NetWeaver

A Service-Oriented Architecture (SOA) is a distributed software model withinwhich all functionality is defined as independent Web services. Within a service-oriented architecture, these Web services can be used in defined sequences

according to the business logic to form applications that enable business processes.

7.1 BUSINESS IMPERATIVES DRIVING IT I N I TIATIVES

Competitive environments, economic constraints, customizationrequirements from partners and customers, and government regulatory initiativescontinue to influence organizations to adopt new and enhanced business processes.These new business processes require information with greater intensities aroundtimeliness, accountability, and quality. Information technology (IT) is a coreelement fueling mission-critical processes, providing a necessary foundation forautomation and continual analyses.

7.2 IMORTANCE OF ARCHITECTURE IN BUSINESS CHANGE

For years, enterprises have been busily building up stores ofapplications and systems to address explicit business needs at a particular point intime . presenting a static solution. Many of these applications have beenconstructed incrementally over long periods of time based on evolvingfunctional specifications and systems scenarios. The resulting situation is akin totaking a house and adding on wing upon wing, each with a separate foundation,

utility infrastructure, and style.Such fragmented application environments have resulted in increased

costs to coordinate and run application systems over time, missing the markfor many organizations' demands around total cost of ownership (TCO) andreturn on investment (ROI). A model that promotes reusability of coreinfrastructure and application services is ideal for increasing value andmaintaining high levels of control. Of additional importance is a system that is builtfor integration and change.

7.3 BENEFITS OF SOAEnterprises that have implemented Web services are finding

significant rewards centered on cross-platform integration. These benefits,however, only touch the surface of what can be truly achieved with a furtherabstracted environment utilizing a service oriented architecture (SOA). Byconstructing autonomous capabilities, enterprises can sever interdependencies between systems, applications, and services and target development efforts moreeffectively at business needs.


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8. Implementation of SAP

SAP Implementation is the whole of processes that defines a complete method toimplement SAP software in an organization. The SAP implementation method described

in this entry is a generic method and not a specific implementation method as such. It isbased on best practices and case studies from various literature sources.

The implementation of SAP software, such as SAP R/3 is almost always amassive operation that brings a lot of changes in the organization. The whole process cantake up to several years. Virtually every person in the organization is involved, whetherthey are part of the SAP technical support organization (TSO) or the actual end-users ofthe SAP software.

An example of how one company, Robert Bosch GmbH, implementedSAP R/3 over 10 years is available. This study shows that designing IT architecture is

very critical in SAP implementation practices.

8.1 Overview

The SAP implementation process is made up out of four main phases, i.e. theproject preparation where a vision of the future-state of the SAP solution is being created,a sizing and blueprinting phase where the solution stack is created and training is beingperformed, a functional development phase and finally a final preparation phase, whenthe last tests are being performed before the actual go live. For each phase, the vital

activities are addressed and the deliverables/products are explained.

The process-data diagram that is depicted at the right, gives an overview of all ofthese activities/processes and deliverables. The four gray boxes depict the four mainimplementation phases, which each contain several processes that are in this case allsequential. The boxes at the right show all the deliverables/concepts that result from theprocesses. Boxes without a shadow have no further sub-concepts. Boxes with a blackshadow depict complex closed concepts, so concepts that have sub-concepts, whichhowever will not be described in any more detail. Boxes with a white shadow (a boxbehind it) depict open closed concepts, where the sub-concepts are expanded in greaterdetail. The lines with diamonds show a has-a relationship between concepts.

8.2 Implementation processes

8.2.1 Project preparation


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The project preparation phase, depicted below, focuses at two main activities, i.e.to make a setup for the TSO and to define a solution vision. These activities allow anorganization to put in on the right track towards implementation.

SAP Implementation process-data diagram


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8.2.1.1 Design and initially staff the SAP TSO

The first major step of the project preparation phase is to design and initially staffan SAP technical support organization (TSO), which is the organization that is chargedwith addressing, designing, implementing and supporting the SAP solution. This can be

programmers, project management, database administrators, test teams, etc. At this point,the focus should be at staffing the key positions of the TSO, e.g. the high-level projectteam and SAP professionals like the senior database administrator and the solutionarchitect. Next to that, this is the time to make decisions about choosing for internal staffmembers or external consultants..

TSO chart example

8.2.1.2 Craft solution vision

The second project preparation job is to define a so-called solution vision,i.e. a vision of the future-state of the SAP solution, where it is important to address bothbusiness and financial requirements (budgets). The main focus within the vision shouldbe on the companys core business and how the SAP solution will better enable that corebusiness to be successful. Next to that, the shortcomings of the current systems should bedescribed and short but clear requirements should be provided regarding availability

(uptime), security, manageability and scalability of the SAP system.

8.2.2 Sizing and blueprinting

The next phase is often referred to as the sizing and blueprinting phase and formsthe main chunk of the implementation process. The phase is illustrated below.
http://en.wikipedia.org/wiki/Image:SAP_Implementation_TSO_chart.png


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8.2.2.1Perform cost of ownership analysis

This phase starts with performing a total cost of ownership analysis (TCOanalysis) to determine how to get the best business solution at the lowest costs. Thismeans to compare SAP solution stack options and alternatives and then determine what

costs each part of the stack will bring and when these costs will be incurred. Parts of thestack are for example the hardware, operating system and database, which form theacquisition costs. Next to that, there should be taken a look at recurring costs likemaintenance costs and downtime costs. Instead of performing a complete TCO analysisfor various solution stack alternatives that would like to compare, it can be wise just to doa so-called delta analysis, where only the differences between solutions (stacks) areidentified and analyzed. The image at the right depicts the essence of a delta analysis.

8.2.2.2 Identify high availability and disaster recovery requirements

The next step is identifying the high availability requirements and the more

serious disaster recovery requirements. This is to plan what to do with later downtime ofthe SAP system, caused by e.g. hardware failures, application failures or power outages.It should be noted that it is very important to calculate the cost of downtime, so that anorganization has a good idea of its actual availability requirements.

8.2.2.3 Engage SAP solution stack vendors

A true sizing process is to engage the SAP solution stack vendors, which is thenext step. This means selecting the best SAP hardware and software technology partnersfor all layers and components of the solution stack, based on a side-by-side sizingcomparison. The most important factors that are of influence here are the estimated

numbers of (concurrent) users and batch sizes.

Simplified SAP solution stack
http://en.wikipedia.org/wiki/Image:SAP_Implementation_simplified_sap_solution_stack.png


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A wise thing to do is to involve SAP AG itself to let them create a sizing proposalstating the advised solution stack, before moving to SAPs technology partners/SAPvendors, like HP, Sun Microsystems and IBM. A simplified solution stack is depicted atthe right, showing the many layers for which software and hardware has to be acquired.Note the overlap with the OSI model.

8.2.2.4 Staff TSO

The TSO is the most important resource for an organization that is implementingSAP, so staffing the TSO is a vital job which can consume a lot of time. In a previousphase, the organization should already have staffed the most vital positions. At this pointthe organization should staff the bulk of the TSO, i.e. fill the positions that directlysupport the near-term objectives of the implementation, which are to develop and beginthe installation/implementation of the SAP data center. Examples are: data center experts,network infrastructure experts, security specialists and database administration experts.

There are many ways to find the right people within or outside the organizationfor all of the TSO positions and it depends on the organization how much time it wants tospend on staffing.

8.2.2.5 Training

One of the most vital stages of the implementation process is training. Very fewpeople within an organization are SAP experts or even have worked with SAP software.It is therefore very important to train the end users but especially the SAP TSO: thepeople who design and implement the solution. Many people within the TSO need allkinds of training. Some examples of these positions:

SAP Network Specialists SAP Database Administrators SAP Security specialists Documentation specialists Et cetera

All of these people need to acquire the required SAP knowledge and skills or evenSAP certifications through training. Moreover, people need to learn to do business in atotally new way. To define how much SAP training every person needs, a company canmake use of a skillset matrix. With this matrix, a manager can identify who possesses

what knowledge, to manage and plan training, by defining the height of expertise with anumber between e.g. 1 and 4 for each skill for each employee.

8.2.2.6 Setup SAP data center

The next step is to set up the SAP data center. This means either building a newdata center facility or transforming the current data center into a foundation capable ofsupporting the SAP solution stack, i.e. all of the technology layers and components (SAP


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software products) in a productive SAP installation. The most important factor whendesigning the data center is availability. The high availability and disaster recoveryrequirements which should have been defined earlier, give a good idea of the requireddata center requirements to host the SAP software. Data center requirements can be a:

Physical requirement like power requirements Rack requirement Network infrastructure requirement or Requirement to the network server.

8.2.2.7 Perform installations

The following step is to install the required SAP software parts which arecalled components and technological foundations like a web application server orenterprise portals, to a state ready for business process configuration. The mostvital sub steps are to prepare your OS, prepare the database server and then start

installing SAP software. Here it is very important to use installation guides, whichare published for each SAP component or technology solution by SAP AG.

8.2.2.8 Round out support for SAP

Before moving into the functional development phase, the organization shouldidentify and staff the remaining TSO roles, e.g. roles that relate to helpdesk work andother such support providing work.

8.2.3 Functional development

The next phase is the functional development phase, where it is all about changemanagement and testing. This phase is depicted below.

8.2.2.9 Address change management

The next challenge for an organization is all about change management / changecontrol, which means to develop a planned approach to the changes the organizationfaces. The objective here is to maximize the collective efforts of all people involved inthe change and to minimize the risk of failure of implementing the changes related to theSAP implementation.

The implementation of SAP software will most surely come with many changesand an organization can expect many natural reactions, i.e. denial, to these changes. Tofight this, it is most important to create a solid project team dedicated to changemanagement and to communicate the solution vision and goals of this team. This teamshould be prepared to handle the many change issues that come from various sourceslike:

End-user requests


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Operations Data center team DBA group Systems management

8.2.3.2 SAP systems and operations management

Next thing is to create a foundation for the SAP systems management and SAPcomputer operations, by creating a SAP operations manual and by evaluating SAPmanagement applications. The manual is a collection of current state systemdocumentation, day-to-day and other regularly scheduled operations tasks, variousinstallation and operations checklists and how-to process documents.

8.2.2.10 Functional, integration and regression testing

Testing is very important before going live with any system. Before going live

with an SAP system, it is vital do to many different kinds of testing, since there is often alarge, complex infrastructure of hardware and software involved. Both requirements aswell as quality parameters are to be tested. Important types of testing are:

Functional testing: to test using functional use cases, i.e. a set of conditions orvariables under which a tester will determine if a certain business process works

Integration testing Regression testing

All tests should be preceded by creating solid test plans.

8.2.4 Final preparation

The last phase before going live can be referred to as the final preparation phase and isdepicted below.

8.2.2.11 Systems and stress testing

Another vital preparation activity before going live with SAP is systems andstress testing. This means planning, scripting, executing and monitoring system and stresstests, to see if the expectations of the end users, defined in service level agreements, willbe met. This can be done with SAPs standard application benchmarks, to benchmark the

organizations configurations against configurations that have been tested by SAPshardware technology partners. Again, a test plan should be created at first.

8.2.2.12 Prepare for cutover

The final phase before going live with SAP is often referred to as the cutover phase, which is the process of transitioning from one system to a new one. Theorganization needs to plan, prepare and execute the cutover, by creating a cutover plan


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SAP SOLUTION MAP


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9. Conclusion

SAP ERP delivers a comprehensive set of integrated, cross-functional businessprocesses. With SAP ERP, you can gain the following benefits:

Improve alignment of strategies and operations

Run your enterprise in accordance with strategy and plans, accessing the

right information in real time to identify concerns early.

Pursue opportunities proactively.

Achieve corporate objectives by aligning workforce and organizational

objectives.

Find the best people and leverage their talent in the right job at the right

time.

Improve productivity and insight

Leverage self-services and analytics across your organization.

Improve operational efficiency and productivity within and beyond your

enterprise.

Reduce costs through increased flexibility

Use enterprise services architecture to improve process standardization,

efficiency, and adaptability.

Extend transactions, information, and collaboration functions to a broad business

community.

Support changing industry requirements

Take advantage of the SAP NetWeaver platform's latest open, Web-basedtechnology to integrate your end-to-end processes seamlessly.

Reduce risk


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Solve complex business challenges today with SAP, your trusted partner for long-

term growth, with 30 years of experience working with organizations of all sizes

in more countries than any other vendor.

Join SAP's world-class partner network, uniquely qualified to support the best

business practices in more than 25 industries.

Improve financial management and corporate governance

Gain deep visibility into your organization with financial and managementaccounting functionality combined with business analytics.

Increase profitability, improve financial control, and manage risk.

Optimize IT spending

Integrate and optimize business processes.

Eliminate high integration costs and the need to purchase third-party software.

Deploy other SAP Business Suite applications incrementally to improve cash flow

and reduce costly borrowing.

Gain higher ROI faster

Install SAP ERP using rapid-implementation techniques that cost less than half

what traditional approaches cost.

Leverage preset defaults and prepackaged versions available for specific

industries.

Retain top performers

Retain your top performers through clearly defined career and development plans.

Link employees' performance to compensation programs such as variable pay

plans and long-term incentives.

Provide immediate access to enterprise information

Give employees new ways to access the enterprise information required for their

daily activities.


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10. BIBLIORAPHY

SAP Web Sites:

o SAP: www.sap.com

o SAP ERP: www.sap.com/solutions/business-suite/erp/index.epxo SAP-ERP: www.sap.com/community/pub/innovation/erp2005/

o Enterprise SOA: www.sap.com/platform/index.epx

o SAP : www.wikipedia.org

News Articles :o SAP History: From Start-Up Software Vendor to Global Market Leader

o Wharton School. "Henning Kagermann: Balancing Change and Stability

in the Evolution of SAP's Enterprise Software Platform",Knowledge@Wharton, October 4, 2006.

o Jeff Moad. "Shai Agassi Leaves SAP", MA News, March 28, 2007.

o

Bailor, Coreen (2006-07-05). For CRM, ERP, and SCM, SAP Leads theWay. Retrieved on 2007-03-29.o Business in Brief: Markets

o web Methods for SAP replacement whitepaper for SAP BC customers

o SAP Q2 2007 Press Release. "SAP Announces Preliminary 2007 Second

Quarter and Six Months Results", Market Watch, July 19, 2007.o "HP and SAP Partners to Offer New Services", Usb4ever.com, January

30, 2007.o Hoover's. "SAP Competitors".
http://www.sap.com/http://www.sap.com/platform/index.epxhttp://www.sap.com/company/history.epxhttp://knowledge.wharton.upenn.edu/article.cfm?articleid=1571http://knowledge.wharton.upenn.edu/article.cfm?articleid=1571http://www.managingautomation.com/maonline/news/read/Shai_Agassi_Leaves_SAP_28302http://www.destinationcrm.com/articles/default.asp?ArticleID=6162http://www.destinationcrm.com/articles/default.asp?ArticleID=6162http://www.destinationcrm.com/articles/default.asp?ArticleID=6162http://en.wikipedia.org/wiki/2007http://en.wikipedia.org/wiki/March_29http://en.wikipedia.org/wiki/March_29http://www.sap.com/company/investor/inbrief/markets/index.epxhttp://www1.webmethods.com/PDF/webMethods_for_SAP-wp.pdfhttp://www.marketwatch.com/news/story/sap-announces-preliminary-2007-second/story.aspx?guid=%7B1CB403EE-17A4-418A-BC29-C290B7CD8EB2%7D&dist=FSQhttp://www.marketwatch.com/news/story/sap-announces-preliminary-2007-second/story.aspx?guid=%7B1CB403EE-17A4-418A-BC29-C290B7CD8EB2%7D&dist=FSQhttp://www.usb4ever.com/hp-sap-p.htmlhttp://hoovers.com/sap/--ID__91277,target__company_competitors--/free-co-samples-index.xhtmlhttp://www.sap.com/platform/index.epxhttp://www.sap.com/company/history.epxhttp://knowledge.wharton.upenn.edu/article.cfm?articleid=1571http://knowledge.wharton.upenn.edu/article.cfm?articleid=1571http://www.managingautomation.com/maonline/news/read/Shai_Agassi_Leaves_SAP_28302http://www.destinationcrm.com/articles/default.asp?ArticleID=6162http://www.destinationcrm.com/articles/default.asp?ArticleID=6162http://en.wikipedia.org/wiki/2007http://en.wikipedia.org/wiki/March_29http://www.sap.com/company/investor/inbrief/markets/index.epxhttp://www1.webmethods.com/PDF/webMethods_for_SAP-wp.pdfhttp://www.marketwatch.com/news/story/sap-announces-preliminary-2007-second/story.aspx?guid=%7B1CB403EE-17A4-418A-BC29-C290B7CD8EB2%7D&dist=FSQhttp://www.marketwatch.com/news/story/sap-announces-preliminary-2007-second/story.aspx?guid=%7B1CB403EE-17A4-418A-BC29-C290B7CD8EB2%7D&dist=FSQhttp://www.usb4ever.com/hp-sap-p.htmlhttp://hoovers.com/sap/--ID__91277,target__company_competitors--/free-co-samples-index.xhtmlhttp://www.sap.com/

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