ERP Assignment

Introduction
SAP ERP or SAP ECC is enterprise resource planning software made by the German company SAP
AG. SAP ERP incorporates the key business functions of an organization. ECC (ERP Central
Component) is software version, released as ECC 5.0 in 2004.SAP ERP (or SAP ECC) solutions address
the needs of an organization to administer and manage organizational operations for human capital
management, financial excellence, operational excellence and a variety of crucial enterprise
management issues. The current version is SAP ERP 6.0 and is part of the SAP Business Suite. Its
previous name was R/3. The "R" of SAP R/3 stood for realtime. The number 3 related to the 3-tier
architecture: database, application server and client (SAPgui). R/2, which ran on a Mainframe
architecture, was the predecessor of R/3. Before R/2 came System RF, later dubbed R/1.
SAP ERP is one of five enterprise applications in SAP's Business Suite. The other four applications are:
Customer Relationship Management (CRM) helps companies acquire and retain customers, gain
marketing and customer insight
Product Lifecycle Management (PLM) helps manufacturers with product-related information
Supply Chain Management (SCM) helps companies with the process of resourcing its
manufacturing and service processes
Supplier Relationship Management (SRM) enables companies to procure from suppliers


Significance-
Enables a company to link its business processes
Ties together disparate business functions (integrated business solution)
Helps the organization run smoothly
Real-time environment
Scalable and flexible
World-wide usage
Designed to satisfy the information needs for business sizes (small local to large all international
Multi-lingual - Multi-currency
Designed to satisfy the information needs for all industries

About the company
SAP AG
- Founded in Walldorf, Germany in 1972
- Worlds Largest Business Software Company
- Worlds Third-largest Independent Software Provider
Company Statistics
- Over 40,000 employees in more then 50 countries
- 1500 Business Partners - 36,200 customers in more then 120 countries
- 12 million users - 100,600 installations
- Have clients like Accenture,Ernst &Young,BMW,IBM,HP,Ford Motors,KPMG etc

History of SAP
When Xerox decided to exit the computer industry in 1975, they asked IBM to migrate their business
systems to IBM technology. As part of IBM's compensation for the migration, IBM was given the
rights to the Scientific Data Systems (SDS)/SAPE software, reportedly for a contract credit of
$80,000.
Five IBM engineers from the AI department (Dietmar Hopp, Klaus Tschira, Hans-Werner Hector,
Hasso Plattner, and Claus Wellenreuther, all from Mannheim, Baden-Wrttemberg) were working in
an enterprise-wide system based on this software, only to be told that it would be no longer
necessary. Rather than abandon the project, they decided to leave IBM Tech and start another
company.
In June 1972 they founded Systemanalyse und Programmentwicklung ("System Analysis and
Program Development") company, as a private partnership under the German Civil Code. The
acronym was later changed to stand for Systeme, Anwendungen und Produkte in der
Datenverarbeitung ("Systems, Applications and Products in Data Processing").
Their first client was the German branch of Imperial Chemical Industries in stringen, where they
developed mainframe programs for payroll and accounting. Instead of storing the data on punch
cards mechanically, as IBM did, they stored it locally. Therefore, they called their software a real-
time system, since there was no need to process the punch cards overnight (for this reason their
flagship product carried an R in its name until the late 1990s). This first version was also a standalone
software, that could be offered to other interested parties.
Enterprise resource planning
In 1973, the first commercial product was launched. It was called SAP R/98,[8] and offered a
common system for multiple tasks. This permitted the use of a centralized data storage, improving
the maintenance of data. From a technical point of view, therefore, a database was necessary.[9]
In 1976, SAP GmbH was founded, and moved its headquarters the following year to Walldorf,
Germany. The company's official name became SAP AG after the 2005 annual general meeting. AG is
short for Aktiengesellschaft, a (public limited company).
Three years later, in 1979, SAP launched SAP R/2, expanding the capabilities of the system to other
areas, such as material management and production planning.[8] In 1981, SAP brought a re-designed
product to market. However, SAP R/2 did not improve until the period between 1985 and 1990.
SAP released the new SAP R/3 in 1992. SAP developed and released several versions of R/3 through
1995. By the mid-1990s, SAP followed the trend from mainframe computing to client/server
architectures. The development of SAPs internet strategy with mySAP.com redesigned the concept
of business processes (integration via Internet).*6+ SAP was awarded Industry Weeks Best Managed
Companies in 1999.

About the contents(Modules) its features,applicability,uniqueness,advantages,to the end user
SAP ERP Business Modules
Collections of logically related transactions within identifiable business functions
- MM (Buy)
- PP (Make)
- SD (Sell)
- FI and CO (Track)
- HCM

SAP MM:
SAP ERP Logistics Material Management handles the procurement to payment process, from
inventory through final invoice receipt and verification. SAP MM ( Material Management ) is one of
the important modules in SAP ERP software and MM application module supports the procurement
and inventory functions occurring in day-to-day business operations. This MM module contains
many aspects such as purchasing, goods receiving, material storage, consumption-based planning,
and inventory. SAP MM module is fully integrated with other modules in the SAP R/3 System such as
Finance (FI), Controlling (CO), Sales and Distribution (SD), Quality Management (QM), Plant
Maintenance (PM), Production Planning (PP), and Warehouse Management(WM).

It supports all phases of materials management materials planning and control, purchasing, goods
receiving, inventory management, and invoice verification.

Organizational Structure
Plant
Valuation area
Storage locations
Purchasing organizations
Purchasing groups



SAP MM Sub Modules-
Material Planning
Purchasing
Inventory Management
Vendor Valuation
Invoice Verification
Statutory Requirements
SAP PP:-
One of the important process in SAP MM module is Purchasing/Procurement. The purchasing
process is initially started when there is a requirement of material/service for the organization. If the
material/service can not be obtained from companys internal resource, the responsible person of
that company must find the vendor/supplier which can provide it on the required date. The
purchasing process is Started with creation of Purchase Requisition (PR), Purchase Order (PO), Good
Receipt/Services,Invoice Verification, Payment to vendors
SAP SD:-
SAP SD ( Sales and Distribution ) is one of the important module of SAP systems and handles the
processes of order to delivery activities. Sap SD manages all activities of pre-sales, receiving &
managing sale orders, and schedules, delivering products to customers, billing to customers for
products sold, handling transportation and distribution of shipments to customers. SAP SD module
integrates with other modules such as Financial Accounting and Controlling (FICO), Material
Management (MM), Production Planning (PP) and so on.
SAP FI & CO
SAP FICO Stands for FI (Financial Accounting) and CO (Controlling). SAP FICO is the important module
of ERP and both FI and CO modules stores the financial transactions data.

What is SAP FICO SAP FI Module :- what is sap fico

SAP FI is the important module of all SAP implementations
SAP FI ( Financial Accounting ) is used for external reporting i.e Balance sheet, Profit and Loss
statements
SAP FICO Module integrates with various other SAP Modules such as MM (Materials Management),
SD(Sales and Distribution), PP (Production Planning), PM (Plant Maintenance),and PS (Project
Systems).
SAP FI (Financial Accounting) Module receives postings from various other modules such as
Materials Management, Sales and Distribution, Human Resource) through integration.
All accounting-relevant transactions which are made in Logistics (LO) are posted real-time to
Financial Accounting by automatic account determination. This data can also be passed on to
Controlling (CO).
what is sap fico

SAP FI Modules contains the following sub-modules

General Ledger accounting
Accounts Receivables
Accounts Payable
Asset Accounting
Bank Accounting
Consolidation
Special Purpose Ledger
Travel Management
General Ledger Accounting :- The general ledger accounting is to provide a complete report for
external and internal accounting i.e Accounts, Journals, Monthly debits and Credit, Balance sheet
and Recording all business transactions.

Accounts Payable :- The Accounts Payable records and manages all accounting data related to
vendors

Accounts Receivable :- The Accounts receivable records and manages all accounting data related to
Customers

Asset Accounting:- Asset Accounting is utilized for managing your companys Assets. SAP allows you
to categorize assets and to set values for depreciation calculations in each asset class.

Bank Accounting :- Bank accounting is used to manage the bank transactions in the system including
cash management.

Consolidation: - Consolidation enables the combining of financial statements for multiple entities
within an organization. These financial statements provide an overview of the financial position of
the company as a whole.

Funds Management:- Funds Management manages budgets for revenues and expenses within your
company as well as track these in the area of responsibility.

Special Purpose Ledger :- Special purpose ledger is used to define ledgers for reporting purposes.

Travel Management :- Travel Management provides management of all travel activities including
booking trips and handling of expenses associated with travel.
SAP CO Module:- what is sap fico ?
SAP Controlling plays an important role for the management decision making and CO Module is used
for the internal reporting purpose. Controlling Area is the organization unit used to represents the
controlling activities of Cost Center accounting, Profit Center Accounting, Product Costing, and
Profitability etc.

SAP CO Module contains the following sub-modules :-

Cost Element Accounting
Cost Center Accounting
Profit Center Accounting
Internal Orders
Product Cost Controlling
Profitability Analysis
SAP HCM / HR:-

SAP HCM (Human Capital Management) Training Tutorials for free of cost by real time SAP HR
experts. SAP HR training material is designed to configure HR module in an easy way step-by-step
with screen shots for Consultant as well as an end user.

SAP HCM (Human Capital Management) is one of the important modules in ERP SAP. SAP HR (human
Resource Management) manages all functions from hiring an employee to its final termination in
organization. It consist various sub components such as Personnel Management, Organizational
Management (OM), Time Management and Payroll.

SAP HR/ HCM module is integrated with other modules such as Production Planning, Material
Management, Financial Accounting (FI), and Controlling (CO).

SAP ERP Core Applications
Logistics
- Sales & Distribution
- Plant Maintenance
- Materials Management
- Production Planning
- Quality Management
Accounting
- Financial Accounting
- Controlling
- Asset Management
- Treasury
Human Resources
- Personnel Management
- Benefits Payroll
advantages of sap

. Vast array of modules, with huge spectrum of functionalities which ARE NOT PROVIDED by other
ERP applications.
2. Specific functionalities which are core competencies of SAP while they are not available in other
ERP applications, makes it an obvious choice for some specific industries. Eg. Variant configuration
and Automobile industry.
3.SAP knowing the demand for special processes for each industry has come up with industry
specific solutions which are unheard of from other applications.
4. Not only on the functinoality side, but also on the system architecture and landscape SAP is
innovating day by day from R2 to R3 to ECC to SOA, to adopt to the business needs, thus adding
immense value to the customers.
5. SAP also gets complimented by most upiquitous office applications of MS namely MSWord.

6. Also SAP's market share gives some certainty of business and hence it is much better than any
other smaller ERP applications in terms of career prospects.

Owing to all these advantages which are not prevalent in other ERP applications, SAP will obviously
become the hot choice for every client who is willing to have a robust and efficient system
Main Features of SAP ERP
SAP ERP is a type of enterprise resource planning software. SAP stands for systems, applications and products in data processing. SAP ERP
offers an integrated platform for all the traditional functions of an organization and allows for an enterprise wide access to a unified database. SAP
ERP has the following key features:-
Standardized Data Definitions under SAP ERP
The data definitions under SAP ERP are standardized across all the modules which enhance the manner in which business processes crossing
functional boundaries can be referenced and seen to completion. In addition to having standardized data definitions, SAP ERP has standard
global data types. This is aimed at increasing the extent to which data can be reused.
Open Systems Architecture in SAP ERP
Open systems architecture in SAP ERP allows for integration of external
information into the system in addition to the internal information that underscores the traditional closed loop systems. This feature allows for
organizations to have a complete look at their business processes from both an internal and external perspective. The open systems architecture
in SAP ERP also allows for data to be broadcasted to the downstream systems. This ensures that information is disseminated across all business
functions that relate to specific business processes.
The fact that third party tools can be incorporated into SAP ERP for analysis and reporting just shows how open the open systems architecture in
SAP EPR is. Companies that take advantage of multiple hardware platforms can also find solace in SAP ERP thanks to its open systems
architecture that supports these heterogeneous systems. A SAP ERP module that is not being actively used by a client organization can easily be
detached from the entire SAP ERP software suite without affecting the other modules. This is attributed solely to the open system architecture in
SAP ERP.
Looking Beyond the Company Scope in SAP ERP
One of the main concepts behind the development of enterprise resource planning software was totality. Totality in this case refers to a situation
where companies are not confined to looking at internal business processes and functions but instead look at business processes and functions
from both internal and external perspectives. SAP ERP supports all the services of an organization to include external units in addition to the
internal units. This ensures that the organization has both internal and external data for strategic planning.
Common Access to a Single Set of Data under SAP
ERP
During the Blueprinting phase of the ASAP implementation methodology a SAP data center is set up. This SAP data center is a unified database
that contains information that would be used by all the modules implemented. In a case where a client organization has fully implemented SAP
modules, the SAP data center will contain all the information and data pertaining to the organization. The various end users therefore have a
common access to a single set of data under SAP ERP.
Flexibility under SAP ERP
The entire SAP ERP system was designed for utmost flexibility. The development of the client-server architecture and more recently the SAP
HANA architecture allow for client organization to run across different database back ends. This is flexibility redefined.
Advantages of SAP ERP
SAP ERP has several advantages that give it a competitive advantage over other ERP software products such as Oracle and Peopesoft. The tide
of change might be coming when SAP ERP is taken to the cloud; only time will tell whether or not SAP ERP will stand this test. The following are
some of the main advantages of SAP ERP:-
SAP ERP provides industry specific business
solutions
SAP ERP is not just any other software product that can be acquired off the shelf. It is a solution to the several challenges that face organizations
in todays dynamic business environment. SAP ERP solutions are bespoke to meet specific requirements of twenty three different industry
categories such as pharmaceutical, aerospace and defense. It is no surprise therefore that an average of 70% of the top 10 companies in specific
industries all claim to use SAP ERP.
SAP ERP Allows for workforce Mobility
SAP ERP has been configured for mobile platforms such as the Apple iPad. This
mobile infrastructure allows for workers to execute their tasks from remote locations. This not only increases their productivity in terms of efficient
use of time but also increases their morale which in most cases translates to better performance. SAP ERP therefore comes in handy especially
to employees such as auditors and engineers who spend most of their time on the field.
SAP ERP allows for Delivery of People Centric
Services.
Customers are at the heart of any business. Businesses would not be in existence without customers. It is a pity therefore that certain software
solutions focus on the internal functions of an organization as opposed to the customers who are responsible for generating business. SAP ERP
allows for an organization to focus on value adding activities. Value adding activities are those that lead to customer satisfaction or contribute
towards meeting customer expectations. Therefore, SAP ERP allows for the delivery of people centric services.
Faster Turnaround and Better Decision Making
SAP ERP allows for expedient analyzing of information which in turn translates to faster turnaround times for businesses. This information is
derived from both internal and external sources. The quality of decision making is therefore markedly improved.