Enterprise Architecture Let us see what an enterprise Architecture is, why we need such an architecture and what its benefits are. Why Enterprise Architecture? Most companies have had numerous information systems that were developed individually over time. For e.g., The Accounting, Purchasing, Shipping, Logistics, Human Resources and Sales departments etc of a company might have independent information systems built for their own internal purposes. Now, Integrating the data from these disparate systems costs a great deal of time and money. The inconsistencies and duplication of data in distinct systems leaves management with uncertain answers to key business questions. Lack of timely information in the fast-paced competitive business world, had many managements reevaluating the benefits of their technology investments. Evidently, the need for a single integrated system was felt as the only and very essential solution. This in effect gave birth to such a system, which we call as an Enterprise Architecture.
Benefits of Enterprise Architecture As we see, an Enterprise Architecture Eliminates discontinuity and redundancies of data in the enterprise systems, making it useful for management purposes. Delivering quality information designed for the Enterprise as a whole, proves to be faster and cheaper. In effect, an Enterprise Architecture Delivers quality information to produce a quality Enterprise. An enterprise architecture is also popularly called as an ERP solution, as an enterprise architecture in itself is an offshoot of the concept of Enterprise Resource Planning.
History of SAP. SAP is the leading ERP software package. SAP was the first to integrate a corporation's worldwide functions tightly into one application. SAP, translated from its original German name, stands for Systems Applications and Products in Data Processing. Five former IBM programmers founded SAP AG in Germany, and released the first version of their software, SAP R/2, in 1979. SAP renamed itself in 1977, prior to which it was called as Systems Analysis and Program Development. Its domination of the market occurred during the 1980s, expanding first throughout Europe (early 1980s) and then North America (1988). SAP R/3, an advanced, client-server based version of the popular R/2 product, was released in 1992 and sparked a stunning takeover of America's largest businesses. SAP is both the name of the company and their ERP product SAP system comprises of a number of fully integrated modules, which virtually covers every aspect of the business management Using SAP's products, companies can now integrate their accounting, sales, distribution, manufacturing, planning, purchasing, human resources, analysis and other transactions into one application. SAP applications thus provide an environment where "transactions are synchronized throughout the entire systems." With 56,000 installations serving 10 million users at 18,800 organizations in 120 countries across the globe, SAP ranks as the world's third-largest independent software provider. So far, there have been 3 systems developed by SAP. namely, R/1, R/2, R/3.
ERP is not new to the marketplace. In fact, SAP created ERP over 30 years ago. 30 years ago the private sector was looking to streamline the business process, eliminate redundancy and frankly reduce the number of systems required to run the business. ERP was the answer. Many organizations we able to significantly reduce systems, cycle time, reconcilation processes etc. With ERP, we were able to reduce cost, simplify the IT landscape, and most importantly impact the operation of the business. During those times, most organizations were able to achieve headcount reduction, inventory reduction, reduction of close time etc. In the late 80’s and into the 90’s companies started to embrace decision support. Many companies embraced the data warehouse concept. It was primarily used for reporting. Sap initially embedded many reports into our solution set. Today, not only is operational excellence and decision support necessary to survive but we must do more. In fact, we must create value in order to survive and effectively compete. Today, organizations are focused on business performance, collaboration and innovation. Look at the President Bush’s management agenda. Technology can not only reduce cost but it can definitely impact the operation. ERP is part of the solution In fact, we have many choices for efficiency and control – business process outsourcing, hosting etc. Yet we know that the data captured in our transactional systems is the exact data that is needed to provide transparency across the enterprise. It is the analysis of this data that gives organizations the opportunity to make much better decisions. Not only can we make those decisions but we can see the impact on the business and the performance of the business.
SAP is the inventor of REAL TIME ERP solutions. This is what originally made SAP unique, and it is still a major strength. SAP became the industry standard; we have remained the yardstick ever since. In the 90‘s, dot.com madness took over and the spotlight fell on eBusiness for a while. Now the spotlight is firmly on ERP. And SAP is becoming the standard for collaborative business applications.
SAP stands for “Systems, Applications & Products in data processing”. Head-quartered in Waldorf, Germany, SAP is the recognized leader in providing collaborative business solutions for all types of industries and for every major market Over the course of three decades, SAP has evolved from a small, regional enterprise into a world-class international company. Today, SAP is the global market leader in collaborative, inter-enterprise business solutions. SAP Snapshot: 1.1 Leader in providing collaborative e-business solutions 1.2 Solutions for all types of industries and for every major market 1.3 Greater market-share than any other business software organization 1.4 Strong ecosystem allows for continued growth, thought leadership and ability to meet all customer requirements
The picture here illustrates a typical R/3 system. Multiple presentation layers from multiple computers communicate with the application servers over the local or wide area network. For a single R/3 system, there may be multiple application servers in order to balance the operational load. All these application servers interact with a single database server. And as the picture illustrates, the database server acts as the interface between the external RDBMS and the application servers. A single database, the R/3 database server that accesses it and the set of one or more application servers and their processes, that govern the business administration and the data sent and received from the database server… all these components that constitute a logically single R/3 system, is called as an R/3 instance.
Overview of Presentation & Database Servers Let us now have a very brief overview of the presentation layer and the database server. The presentation server is simply a GUI that is running at the user’s workstation. It is a very light component, called as a thin client in common terminology. It is capable of sending requests to the application server, receiving the requests back and displaying the screen back to the user. Multiple instances of presentation servers can execute in the same work station. And generally the presentation layers are, to a good extent, downward compatible with the application servers, in terms of the version. For e.g., A “4.6 C” version GUI would be able to communicate with a “4.5 B” version application server. The messages exchanged between the presentation layer and the application server are in a SAP proprietary format. The presentation layer is capable of accepting the screen information sent from the application server, format and generate the screens appropriately for the platform it is running on. The database server, as we saw earlier, acts as an interface between the application server and the RDBMS. As we know already, the R/3 system does not include the RDBMS. In other words, R/3 is independent of the RDBMS. R/3 is operational on a number of commercial RDBMSs. The vendor specific DB driver resides in the database server.
SAP R/3 Conceptual Areas The R/3 system, as an application, is conceptually divided into 3 areas. Namely the application area, the basis area and the development area. This is in being synonymous to the 3 main type of users. Viz., the application users or the end users, the admin users, popularly called as the basis people and the developers. The application area is where users initiate and execute transactions of the various functional areas of R/3 like Accounting, Human Resources, Logistics etc. The basis area is where the basis people or the admin users execute transactions that are used for monitoring the R/3 system like performance, database administration, scheduling etc. The development area is where tools and transactions are available for developers and programmers to create and test ABAP/4 programs. This is referred to as a developer’s workbench.
Basic SAP R/3 and ABAP/4 concepts We will now brush through a few basic concepts of the R/3 System The Logon Client The term “logon client” has nothing to with the Client/Server terminologies. A client in R/3, is a 3 digit number which enables one to maintain multiple independent sets of data within the same R/3 system. Within the same R/3 system we can have client with range 000 to 999. The client id is also supplied along with user id and password at the time of login. This means that each client will have an independent set of data. For e.g., when a person logs into client 800, the data he sees, for e.g., purchase orders or vendor details etc., will not be available when he logs into client 700. Client mechanism and handling The client concept is implicitly handled within the same R/3 system. In the figure illustrated, when a user logs on to client 800 and runs a program that selects the field LIFNR from the table LFA1, the result of that selection would only be two rows though there are 6 rows available in the table. Similarly, had the user logged on to client 700, the selection would have yielded only 4 rows. As we see, the client concept is handled using an extra field MANDT in the table to store the client. We need to note here that the table illustrated here is client-dependent. Which means that the data stored within the table is dependent on the logon client. But however, an R/3 table can also be client independent i.e., the MANDT field would not be present in the table and the data contained in the table is same across all clients. The SAP client concept allows you to map each customer to one client, without having to install and administer a separate systems for each customer. This makes it possible for the provider to install a small number of SAP Systems, but still cater to a large number of customers. Costs are not only saved by sharing hardware and software, multiple customers also use the same application solution, including administration and support. But however, to guarantee the secure and reliable co-existence of customers under a common system umbrella, certain rules and guidelines must be followed.
Clients are used to divide data in a SAP System into various data areas for various purposes. If a company, for example, wants to use its SAP System for both test and training purposes, a client is created for each purpose. A client is identified via a three character code. Data can be moved via transports and corrections from one client to another. When logging on to the system, the user has to select a client in which he/she wants to work. The user can then only access data in this client.
3 When you use R/3, you are free to choose your technical infrastructure. You determine which hardware, operating systems, or databases you want to use. The entire gamut of offerings from the leading international vendors is open to you; you can even plan your IT strategy with various systems from different manufacturers. Most importantly, the openness of R/3 protects your investment for the long term. As your company grows, R/3 grows with you. And if you change your hardware environment, R/3 stays with you on your path of change without jeopardizing your software investment. Infinitely expandable The number of workstations you include with the R/3 in your client/server solution is determined solely by your individual need. R/3 is infinitely expandable, and can be used just as well in client/server architectures with 30 seats as in installations with 3,000 end-users. This scalability ensures that R/3 can always grow with your requirements. We offer total solutions for qualified client/server information processing that combines a variety of products and services in a smoothly functioning communication network. R/3 incorporates not only system management, database recovery, and print management, but also network administration and backup solutions. Our partnerships with hardware manufacturers, database providers, and technology and service companies play a significant role here. Everything is possible... The benefit: Cooperative client/server processing distributes applications and computing capabilities almost at will across a number of levels, and systematically takes advantage of the strengths of different hardware and software components. Whether you use R/3 in two- or three-tier client/server architectures, locally or worldwide,
Platforms and Databases supported by R/3 The R/3 Application server can be installed on multiple operating systems including Solaris HP – Unix, Windows NT and OS/400. And for each of these operating systems, multiple hardware platforms are also supported. The presentation layer GUI is also supported in many operating system which includes Win 95, Win NT, OS/2 and Macintosh. The R/3 database server can also be implemented of various RDBMS including DB/2, Informix, Oracle and SQL Server.
The R/3 System architecture allows you to separate application from the presentation and the database. This is the prerequisite for distributing load onto several application servers in client/server configurations. Therefore, the system can be distributed, in hardware terms, at three different levels. This architecture means that the installed host service can be adjusted without any problems ( scalability ), especially where load profiles have changed as a result of increasing user numbers, or because additional components have been used. R/3 System scalability provides you with flexibility when choosing hardware and software. Examples of R/3 System scalability: . Brewery - 20 users . Small Telecom company - 415 users . Large Software Company - 2000 users . Oil & Gas Company - 2500 users . Large Engineering Company- 3200 users . Large Telecom Company- 5800 users
Let us see a few of the R/3 Modules in brief Financial Accounting Financial Accounting is designed for automated management and external reporting of general ledger, accounts receivable, accounts payable and other sub-ledger accounts with a user defined chart of accounts. As entries are made relating to sales production and payments journal entries are automatically posted. This connection means that the "books" are designed to reflect the real situation. Controlling Controlling represents the company's flow of cost and revenue. It is a management instrument for organizational decisions. It is also automatically updated as events occur. Assets Management Asset Management is designed to manage and supervise individual aspects of fixed assets including purchase and sale of assets, depreciation and investment management. Sales and Distribution Sales and Distribution helps to optimize all the tasks and activities carried out in sales, delivery and billing. The key elements are; pre-sales support, inquiry processing, quotation processing, sales order processing, delivery processing, billing and sales information system. Materials Management Materials Management supports the procurement and inventory functions occurring in day-to-day business operations such as purchasing, inventory management, reorder point processing, etc. Production Planning Production Planning is 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 Quality Management Quality Management is a quality control and information system supporting quality planning, inspection, and control for manufacturing and procurement. Plant Maintenance In a complex manufacturing process, maintenance means more than sweeping the floors. Equipment must be services and rebuilt. These tasks affect the production plans. Plant Maintenance module supports and supervises these maintenance. Warehouse Management Warehouse Management provides flexible, automated support to assist in processing all goods movements and in maintaining current stock inventories in the warehousing complex. Human Resources Human Resources is a complete integrated system for supporting the planning and control of personnel activities. Workflow Workflow is a solution which has been integrated fully in the R/3 System and which enables customer-specific business process flows to be coordinated and controlled on a cross-application and cross-workplace basis. Project System Project System is designed to support the planning, control and monitoring of long-term, highly complex projects with defined goals.
Industry solution is the latest value proposition of SAP to customer. Industry solutions are aimed at addressing the specific business process areas of different industries differently, hence pre-customizing the package for generic industry purpose. Through its industry solutions, SAP addresses the unique core processes of more than 25 distinct industries. Combined with industry-specific applications and best business practices, all industry solution sets use and build upon mySAP™ Business Suite solutions, powered by the SAP NetWeaver™ platform. SAP currently around 27 Industry solutions. Some of the key verticals are listed below: 1. Manufacturing Industries SAP for Automotive SAP for Chemicals SAP for Consumer Products SAP for Engineering, Construction & Operations (SAP for EC&O) SAP for High Tech SAP for Oil & Gas (SAP for O&G) 2 Service Industries SAP for Media SAP for Professional Services SAP for Retail SAP for Telecommunications SAP for Utilities 3 Public Services SAP for Healthcare and SAP for Public Sector 4 Financial Services SAP for Banking, SAP for Financial Service Providers and SAP for Insurance
Business partner master data is the building block for the whole customer interaction cycle. Business partner master data is not restricted to customers but reflects also competitors, partners and employees that may be involved in the sales or service cycle.
Description of each offereing and what this means Please do not clutter the slides....
It is a comprehensive integration and application platform, SAP NetWeaver works with your existing IT infrastructure to enable and manage change. With SAP NetWeaver, you can flexibly and rapidly design, build, implement, and execute new business strategies and processes. The platform enables you to drive innovation throughout your organization by recomposing existing systems while maintaining a sustainable cost structure. You can also add innovative, industry-specific business processes with reduced risk to existing systems and a strong return on investment. SAP NetWeaver unifies integration technologies into a single platform and is preintegrated with business applications, reducing the need for custom integration. The platform is based on industry standards and can be extended with commonly used development tools such as Java 2 Platform, Enterprise Edition (J2EE); Microsoft .NET; and IBM WebSphere. SAP NetWeaver makes change sustainable by helping you contain costs and reduce risk as you evolve your business. The platform is the technical foundation of mySAP Business Suite solutions, SAP xApps composite applications, partner solutions, and custom-built applications -- including composite applications -- providing the best way to integrate all systems running SAP or non-SAP software. It also enables Enterprise Services Architecture, SAP's blueprint for service-oriented business solutions. Finally, SAP NetWeaver is the technology foundation that powers SAP solutions.
Business Scenario: Business-related grouping of business processes localized in a specific organizational area that share some similar goals in an enterprise, such as purchasing, services, balance sheet preparation, production, personnel administration, and so on. Organizational Unit: Organizational grouping of enterprise areas which, for legal reasons or for other specific business-related reasons or purposes, are grouped together. Organizational units include legal company entities, sales offices, and profit centers. Master Data: Data which is used long-term in the R/3 System for several business processes. Examples include customers, materials, and vendors. Transactions: Application programs which execute business processes in the R/3 System such as creating a customer order, posting an incoming payment, or approving a leave request. Document: A data record that is generated when a transaction is carried out. Reports: Program which reads certain data elements and displays them in a list.
Client : - In commercial, organizational and technical terms, a self-contained unit in an R/3 System with separate master records and its own set of tables. Company code : - The smallest organizational unit of Financial Accounting for which a complete self-contained set of accounts can be drawn up for purposes of external reporting. This includes recording of all relevant transactions and generating all supporting documents required for financial statements. Plant : - In Logistics a plant is an organizational unit for dividing an enterprise according to production, procurement, maintenance, and materials planning. A place where materials are produced, or goods and services are provided. Controlling Area : - An organizational unit within a company, used to represent a closed system for cost accounting purposes. A controlling area may include single or multiple company codes that may use different currencies. These company codes must use the same operative chart of accounts. All internal allocations refer exclusively to objects in the same controlling area. Sales Area : - A combination of sales organization, distribution channel, and division Purchasing Organization :- An organizational unit in Logistics, subdividing an enterprise according to the requirements of Purchasing. Purchasing Organization : - A purchasing organization procures materials and services, negotiates conditions of purchase with vendors, and is responsible for such transactions. You specify the form of procurement by assigning purchasing organizations to company codes and plants. Possible forms are: Enterprise-wide: One purchasing organization procures for all the company codes of a client - that is, for all companies belonging to a corporate group Company-specific: One purchasing organization procures for one company code Plant-specific: One purchasing organization procures for one plant Mixed forms are possible. These are replicated in the system using reference purchasing organizations. A purchasing organization can access and use the most favorable conditions and centrally agreed contracts of the reference purchasing organization assigned to it. Personnel Area :- An organizational unit representing an area in an enterprise delimited according to personnel administration, time management, and payroll accounting criteria.
A company code is an independent accounting entity (the smallest organizational element for which a complete self-contained set of accounts can be drawn up). An example is a company within a corporate group. It has a unique, four character key. The general ledger is kept at the company code level and is used to create the legally required balance sheets and profit and loss statements. A company code designation is required for every financially based transaction entered into R/3. This is done either manually or automatically by deriving the company code from other data elements.
The highest-level element of all organizational units is the client. The client can be an enterprise group with several subsidiaries. All of the enterprise data in an R/3 System implementation is split into at least the client area, and usually into lower level organizational structures as well. Flexible organizational units in the R/3 System enable more complex enterprise structures to be represented. If there are many organizational units, the legal and organizational structure of an enterprise can be presented in different views. By linking the organizational units, the separate enterprise areas can be integrated and the structure of the whole enterprise represented in the R/3 System.
An enterprise is structured in the SAP R/3 System according to business functions that must correspond to the functionality assigned to the organizational units. Examples: . A Company Code is a unit included in the balance sheet of a legally-independent enterprise. It is the central organizational element of Financial Accounting. . The Controlling Area is the business unit where Cost Accounting is carried out. Usually there is a 1:1 relationship between the controlling area and the company code. For the purpose of companywide cost accounting, one controlling area can handle cost accounting for several company codes in one enterprise. . In the context of Sales and Distribution, the Sales Organization is central organizational element that controls the terms of sale to the customer. Distribution Channel is the element that describes through what channel goods and/or services will be distributed to the customer. . In the context of Production Planning and Control, the Plant is the central organizational unit. A plant is the place of production or simply a collection of several locations of material stocks in close physical proximity. A Storage Location is a storage area comprising warehouses in close proximity. Material stocks can be differentiated within one plant according to storage location (inventory management).
An enterprise structure is mapped to SAP applications using organizational units. Organizational units handle specific business functions. Organizational units may be assigned to a single application (such as a sales organization assigned to Sales and Distribution, or to several applications (such as a plant assigned to Materials Management and Production Planning).
The client is the highest level in the R/3 system hierarchy. Specifications or data which shall be valid for all organizational units in all R/3 applications are entered at the client level, eliminating the need to enter this information more than once (e.g. exchange rates). Each client is a self-contained unit which has separate master records and a complete set of tables and data. Users must enter a client key and have a user master record in the client in order to log on to the system. Main FI-units: . Company: A group of statutory entities for consolidating results . Company code (external purposes) A Company Code represents an independent balancing/legal accounting entity. An example would be a company within a corporate group. Balance sheets and profit/loss statements required by law, can be created at the company code level. Therefore, a company code is the minimum structure necessary in R/3 FI. In an international business, operations are often scattered across numerous countries. Since most government and tax authorities require the registration of a legal entity for every company, a separate company code is usually established per country. . Business area (internal purposes) Business areas represent separate areas of operation within an organization and can be used across company codes. They are balancing entities which are able to create their own set of financial statements for internal purposes. The use of business areas is optional.
Organizational unit Client Obligatory Company Optional Company code Obligatory
Plant The site at which value addition to the production happens and stocks are handled. A Plant is a place where either materials are produced or goods & services are provided Storage Location A location where a group of materials are physically handled Purchasing Organisation Unit responsible for procurement of materials and services and negotiates with vendors Purchase Groups Buyers responsible for purchases who handles specific group of materials or vendors
External: Sales Organisation - represents the unit responsible for selling Distribution Channel – defines different ways of reaching customer Division – Segment responsibility of products Sales Area – the combination of Sales Org/DC/Division Credit Control Area - Area of an organization grouped from credit perspective Internal: Sales District – Sales territories in an organisation Sales Office – method of representing internal subdivions Sales Groups – further internal divisions of people in sales office Sales Employee - an employee carrying out sales Shipping Point – location in a plant from where deliveries happen Loading Point – Part of a shipping point where physical delivery is handled
The R/3 System is a client system . The client concept enables the joint operation, in one system, of several enterprises that are independent of each other in business terms. During each user session you can only access the data of the client selected during the logon. A client is, in organizational terms, an independent unit in the R/3 System. Each client has its own data environment and therefore its own master data and transaction data, assigned user master records and charts of accounts, and specific customizing parameters. A user master record linked to the relevant client must be created for users to be able to log on to the system. To protect access, a password is required for logon. The password is hidden as you type (you only see asterisks). n SAP systems are available in several languages. Use the Language input field to select the logon language for each session. Multiple logons are always logged in the system beginning with Release 4.6. This is for security as well as licensing reasons. A warning message appears if the same user attempts to log on twice or more. This message offers three options: . Continue with current logon and end any other logons in the system . Continue with current logon without ending any other logons in the system (logged in system) . Terminate current logon
SAP Easy Access is the standard entry screen displayed after logon. Using the menu path Extras® Set start transaction you can select a transaction of your choice to be the default entry screen after logon. You navigate through the system using a compact tree structure that you can adapt to your own specific requirements. Use the menu path Extras® Settings to change your view of the tree structure. You can use this to display technical names (transaction codes). You can also create a Favorites list of the transactions, reports, files and Web sites you use most. You can add items to your favorites list using the Favorites menu option or by simply dragging & dropping them with the mouse.
Command field: You can use the command field to go to applications directly by entering the transaction code. You can find the transaction code either in the SAP Easy Access menu tree (see next slide) or in the relevant application under System® Status . Menu bar: The menus shown here depend on which application you are working in. These menus contain cascading menu options. Standard toolbar: The icons in the system function bar are available on all R/3 screens. Any icons that you cannot use on a particular screen are dimmed. If you leave the cursor on an icon for a moment, a small flag will appear with the name (or function) of that icon. You will also see the corresponding function key. The application toolbar shows you which functions are available in the current application. Title bar: The title bar displays your current position and activity in the system. Check boxes: Checkboxes allow you to select several options simultaneously within a group. Radio buttons: Radio buttons allow you to select one option only. Status bar: The status bar displays information on the current system status, for example, warning and error messages. A tab provides a clearer overview of several information screens. Options: You can set your font size, list colors, and so on here.
You can select system functions in the following ways: Use the mouse to choose . Menu options . Favorites . Other options in the tree structure (tree control) Use the keyboard (ALT + the underlined letter of the relevant menu option) Enter a transaction code in the command field : . A transaction code (T-Code) is assigned to each function in R/3 (not each screen). . You can access the assigned transaction code from any screen in the R/3 System. . You can find the transaction code for the function you are working in under the Status option of the System menu. . For example, to display Accounts receivable master data, enter “/n” and the appropriate transaction code (in this case “/nfd03”). . Other possible entries: “/n” ends the current transaction. “/i” ends the current session. “/osm04” creates a new session and goes to the transaction specified (SM04). . You can also use the keyboard to get to the command field. Use the CTRL + TAB key combination to make the cursor move from one (input) field group to the next. Use TAB to move between fields within a group.
A role describes a set of logically linked transactions. These transactions represent the range of functions users typically need at their workstations. Activity groups (user roles) have to be set up using the Profile Generator so that users of the SAP System can work with user-specific or position-related menus. The authorizations for the activities listed in the menus are also assigned to the users using activity groups. With Release 4.6, predefined activity groups (user roles) from all application areas are included in the standard system. Users who have been assigned to an activity group can choose between the user menu and the SAP standard menu. The above screen shows the role -based user menu for the “Accounts Receivable Supervisor” as an example. You can find other roles that are supplied in the standard SAP System with the corresponding activity groups using the Other menu pushbutton in the SAP Easy Access initial screen.
Use F1 for help on fields, menus, functions and messages. F1 help also provides technical information on the relevant field. This includes, for example, the parameter ID, which you can use to assign values to the field for your user. Use F4 for information on what values you can enter. You can also access F4 help for a selected field using the button immediately to the right of that field. If input fields are marked with a small icon with a checkmark, then you can only continue in that application by entering a permitted value. You can flag many fields in an application to make them either required entry fields or optional entry fields. You can also hide fields using transaction or screen variants or Customizing.
The variant principle is a widely used method in R/3 to assign special properties to one or more R/3-objects. For example using creating a company code as an example; 1. Define the variant: K4 is our fiscal year variant 2. Populate the variant with values: we define the properties of K4 to be “calendar year” 3 Assign the variant to R/3 objects: we assign K4 to multiple company codes that use that calendar The main advantage for using variants is that it is easier to maintain properties which are common among several business objects.
Introduction to SAP Package 200 - FICO - Infosys 1
PP contactsCustomersBusiness without ERP Purchasing for raw material 4 Purchasing Customer Calls to 1 place order for a Car Sales office/Inventory contacts PP Production Planning 3 3 Sales office contacts Inventory 2Sales Inventory
Business without ERP (Contd..) Lets add some more Business Processes
Where is my What is this Business without ERP (Contd..) car Customers confusion What to manufactur e?? Whom to Production contact for Planning status? What is Cost andSales Shop floor profit Finance Purchasing Vendors Inventory
Lets Deliver the end product to I did not ordercustomer.. for a TRUCK!!!! Dear Sir, Your Order… Sales
Business without ERP (Contd..) I AM NOT TAKING DELIVERY AND WILL NEVER DEAL WITH YOU! We are SORRY Sir Sales
Overall Picture Vendors Sales Purchasing General Ledger A/PCustomers A/R Production Planning Inventory Shop Floor Execution
Why Enterprise Architecture ? Why Enterprise Architecture Numerous disparate information systems Integrating the data becomes costly Time Money Resources Inconsistencies and duplication of data Lack of timely information
Enterprise Structure – IntegratingBusiness Payroll FA Marketing HR GL Treasury Partner Shop Floor AP Systems Purchasing PP Sales AR Plants Mfg.
Enterprise Architecture - BenefitsEliminates the duplication, discontinuity and redundancy indataIncreases the return on investment made on ITimplementationsDelivers quality information designed for the Enterprise as awholeFaster and cheaperDelivers quality information to produce a quality enterpriseSatisfying Partners/CustomersP ERReducing required manpower
Quiz TimeWhat is the full form of SAP?When was SAP founded?
Quiz Time What is the full form of SAP?Systems Applications and Products in Data Processing When was SAP founded?Founded in 1972 by Wellenreuther, Hopp, Hector, Plattner and Tschira Renamed in 1977
History of SAPSystems Applications and Products in Data Processing German : Systeme, Anwendungen, Produkte in der DatenverarbeitungFounded in 1972 by Wellenreuther, Hopp, Hector, Plattner andTschira Renamed in 1977 Before 1977 : Systems Analysis and Program Development (German : Systemanalyse und Programmentwicklung)SAP is both the name of the Company as well as their ERPProduct
Steps to Strategic ERP Enterprise Resource Planning is evolved through these Inter-Enterprise Enterprise Resource Planning stages … Co-operation Collaborative Business Create Strategic Value Total Efficiency andCompany Control Value Automation 80’s R/2 90’s R/3 Today mySAP ERP Evolution of ERP
3 Tier Client / Server ArchitectureThe SAP R/3 architecture is based on a 3-tierclient/server principle Presentation Server Application Server Database ServerDedicated Servers are linked by Communication
Overview of Presentation &Database ServersThe Presentation Server GUI only At workstation Very light Sends requests to application server Obtains screens from application server and displaysThe Database Server Interface between application server and RDBMS Also holds the vendor specific DB driver
SAP R/3 Conceptual Areas SAP Conceptual Areas Basis Area Development AreaApplication Area (The technical (1. A developer’s (Initiate and execute workbench administration of SAP transactions) 2. Create & Test the system) ABAP/4 programs) (Functional) (Authorizations/Ids/etc) (Technical)
Transport RequestSystems in R3Development Quality Production System System System (DC) (QC) (IC) Client 110 100 etc..
Clients in R/3The Logon Client 3 digit number ( 000 to 999) Helps maintain independent sets of data within the same R/3 systemClient mechanism and handling
Hardware R/3 Technology Environment UNIX Systems Bull/Zenith Digital NCR Bull IBM Compaq HP (Intel) Sequent IBM IBM Digital SNI Data General IBM (Intel) SNI AS/400 S/390 HP SUN ...Operating AIX Reliantsystems Digital UNIX UNIX (SINIX) Windows NT OS/400 OS/390 HP-UX SOLARISDatabases ADABAS D ADABAS D DB2 for AIX MS SQL Server DB2 for DB2 for INFORMIX-OnLine INFORMIX-OnLine OS/400 OS/390 ORACLE ORACLE Dialog Windows 3.1, Windows 95, Windows NT, SAPGUI OSF/Motif *, OS/2 Presentation Manager (PM), Macintosh *, JavaLanguages ABAP/4, C, C++, HTML, Java
Platforms and Databases supportedby R/3 Operating Supported Supported Front Supported Systems Hardware ends Databases AIX SINIX IBM SNI SUN Win 3.1/ 95 / NT DB2 for AIXSOLARIS HP-UX Digital HP OSF / Motif Informix – Online Digital Unix Bull OS/2 Oracle 7.1 Macintosh ADABAS D Windows NT AT&T Compaq Win 3.1 / 95 / NT Oracle 7.1 Bull / Zenith OSF / Motif SQL Server 6.0 HP (Intel) SNI OS/2 ADABAS D IBM (Intel) Macintosh Digital (Intel) Data-General OS/400 AS/400 Win 95 OS/2 DB2/400
SAP Modules SD – Sales and Distribution FI – Financial Accounting MM – Materials SD FI CO – Controlling Management MM CO PP – Production Planning AM – Asset Management PP AM SAP R/3 QM HRQM – Quality Management PM WF HR – Human Resources PM – Plant Maintenance WM PS WF – Workflow WM – Warehouse PS – Project System Management
SAP R/3 Application ModulesFinancial accounting (FI)Controlling (CO)Asset management (AM)Materials management (MM)Sales and Distribution (SD)Production Planning (PP)Quality management (QM)Plant maintenance (PM) & Customer Service (CS)
Module Functionalities MM PP SD Material Procurement BOM/Work Center/Routing Inquiry processing Inventory Management MRP Sales Order Processing Batch Management Capacity Evaluations Delivery Processing Goods inspection Production Orders Billing Invoice Verification QM in production FI CO General Ledger Cost Center Accounting Accounts Payable Product Costing Accounts receivable Order Contribution Analysis Cash management
Match the followingQuiz TimeFinancial InventoryAccounting ManagementControlling Shop Floor ControlMaterials FinancialManagement ReportingSales & Profit centerDistribution AccountingProduction Billing
Match the followingQuiz TimeFinancial AssetAccounting Management & Financial ReportingControlling Profit center AccountingMaterials InventoryManagement ManagementSales & Billing
Module FI – Financial Accounting • External reporting of • General ledger • Accounts receivable/payable • Sub-ledger accounts with a user-defined Chart of Accounts • Key elements • General ledger • Accounts payable • Accounts receivable • Asset Management • Special Purpose Ledger (FI-SL) • Legal consolidation • Accounting Information System
Financial Accounting Management Bank Foreign exchange of secureties management and loansFinance information Cash managementsystem and forecast Accounts Accounts payable receivable Bank accounts Payables Receivables General Ledger Extended General Ledger Credit Invoice verification management Consolidation
Module CO – Controlling • Represents the flow of cost and revenue • Instrument for organizational decisions • Key elements of the CO application module include : • Cost center accounting • Product cost Planning • Product Costing • Profitability analysis • Profit center accounting • Activity based costing • Enterprise controlling
Module SD – Sales and Distribution • Optimize tasks/activities in • Sales • Delivery • Billing • Key elements of the SD application module include : • Pre-sales support • Inquiry processing • Quotation processing • Sales order processing • Delivery processing • Warehouse management • Billing • Credit Management • Sales Information system
Sales Sales Support and Distribution Processing SalesSALES INFORMATION SYSTEM activity MATERIALS MANAGEMENT Sales Inquiry Quotation Contract Delivery Subsequent Sales Scheduling USD free of delivery free Returns order agreement charge of charge Shipping Delivery Billing Debit memo Invoice Credit memo FINANCIAL ACCOUNTING
Module MM – Materials Management• Supports • Procurement • Inventory• Key elements • Materials procurement (purchasing) • Inventory management • Invoice verification • Material valuation • Vendor evaluation • External Services management • Purchasing Information System (PurchIS) • Inventory Controlling Information system
Materials ManagementBASIC DATAMaterial PURCHASING Purchase requisition MRP SD Third-party order Special stock Batch Direct requisition Release procedures PP Requirements Purchasing information systemVendor/one-time customer RFQ/Quotation Material/service PM Service/ Price comparisons Spare Parts Vendor evaluationPurchasing info record Price comparison list Service /Service Purchasing QM spare parts lot Inspection specifications Purchase orders Outline agreements G/L accountsWorkflow Scheduling agreements FI Cash management and forecastOptical archive INVENTORY MANAGEMENT Goods receipt/issue AM Fixed assetsTexts Transfer posting Mail Quantities and values Communication Physical inventory Cost center / Storage bins COClassification BudgetDocuments INVOICE VERIFICATION Check and post PS ProjectConditions Price update
Module PP – Production Planning • To plan and control the manufacturing activities • Key elements • Bill of Material (BOM) • Routings • Work Centers • Sales and Operations planning (SOP) • Master Production Scheduling (MPS) – Capacity Planning • Materials Requirement Planning (MRP) • Shop Floor Control (SFC) • Production orders • Product costing, activity-based costing • Work in process • Kanban • Production planning for process industries (PP-PI) • Repetitive Manufacturing
Production Planning SD PP PS SD Sales and Operations Project Planning Networks Customers Demand management / SD MPS PM SD Sales Material requirements Maintenance Shipping planning Repairs Billing Plant maintenance Detailed Schedeling and Planning Vendors MM SD Capacity planning QM SD Purchasing Shop floor control Inbound Raw Warehouse Costing Material Invoice Information system verification Finished GoodsFI CO HR Financial Cost Human accounting accounting resources
Module QM – Quality Management• Supports • Quality planning • Inspection • Control for manufacturing • Costing • Procurement• Key elements • Quality planning • Quality during procurement, production, distribution • Quality Management Information - Quality inspection • Information System (QMIS)
Module PS – Project System & HR – Human Resource• PS – Project Systems • Support planning, control, & monitoring of long term highly complex projects with defined goals • Key elements • Project WBS – Plan • Budget & Monitor • Network Management • Activity monitoring, Material Planning, Milestones, Capacities Scheduling • Project Management Information System• HR – Human Resource • Key elements • Recruitment • Payroll & Time management • Travel Expense accounting & Benefits • Workforce planning & Training administration • Organization management
Quiz TimeIs Industry solutions an SAP module like FI/CO/MMetc?True/False PP Supports procurement and Inventory FI Handles project budgeting and monitoring
Quiz Time solutions a module like FI/CO/MM Is SAP - Industry etc? NO True/False PP Supports procurement and Inventory (False – MM Supports these functions) FI Handles project budgeting and monitoring (False – PS handles these functions)
IS – Industry Solutions • Combines SAP R/3 application modules to additional industry- specific functionality • Result of the research by industry Centers expertise (ICOE)
mySAP Industry Solutions (Some SAP for Aerospace &Examples) Defense SAP for Media SAP for Healthcare SAP for Automotive SAP for Public Sector SAP for Mill Products SAP for High Tech SAP for Banking SAP for Retail SAP for Mining SAP for Higher Education & SAP for Chemicals Research SAP for Oil & Gas SAP for Service Providers SAP for Consumer Products SAP for Industrial Machinery & Components SAP for Pharmaceuticals SAP for Telecommunications SAP for Engineering, Construction & Operations SAP for Insurance
Evolution of SAP products Solutions mySAP CRM mySAP mySAP SCM Business mySAP HR Suite mySAP ERP mySAP PLM ……….. R/3 Enterprise R/3 SAP NetWeaver Web AS •Easing Upgrade Plans & Providing Transition Options •Bringing benefits of SAP Netweaver into installed base •New Customers have more entry options & receive world –class ERP
Evolution of SAP products my SAP my SAP SAP R/3 Business Solutions Suite
SAP R/3 Financials HR Corporate Services Operations
my SAP Business Suite mySAP PLM mySAP SCMmySAP mySAP Financials mySAPSRM CRM mySAP HR Corporate Services OperationsSAP NetWeaver Application Platform ( Web As) People Integration (Portal) Information Integration( BI,MDM) Process Integration (XI)
Where does a CRM solution fit? Who Marketing Sales Service Executives What Service Use a CRM Engage Solution to complete the Cycle Fulfill Transact Workplace Which way Internet Mobile Telephony How Operational Analytical Collaborative
mySAP.com CRM Component LandscapePortal Users OLTP R/3 System CRM System BW As one big logical boxInternet Telephone APO Callers Mobile Clients
CRM Internet SalesEnterprise B2C Scenario Consumer Internet- selling BBP Scenario Business Partner B2R Scenario Reseller
Service Planning within CRM• Service module • Proactively engage customers with the correct resources at the most beneficial times• Customer Care • Provide customer with 24/7 accessibility from all communication channels with precise and consistent informationon• Installed Base Management • Maintain an accurate, up-to-date record of a customer’s
MobileofSales module within of the Suite tools tailored to the needs CRM offline mobile sales force Provides an integrated view of customers, prospects, products, services, competitors, activities, opportunities, quotations, orders, etc. Heavy cross-referencing for easy navigation Facilitates the sales process by Effectively managing customers and prospects Providing appropriate customer, product and competitive information
Quiz TimeWhat is the latest version of mySAPCRMName the three service modules with inCRM
Quiz TimeWhat is the latest version of mySAP CRM(Version 5.0)Name three service modules with in CRM Service Planning Customer care
My SAP Supplier RelationshipManagement (SRM) Package 200 - FICO - Infosys 72
Key Components of mySAP SRM• Strategic Sourcing •Sourcing analytics: Helps provide analytics based on supplier location, line of business •Supplier evaluation: Helps you evaluate the supplier base within the organization systems and external market places to identify and select supplier to ensure reliable & uninterrupted supply •Request for quotation and auctions: Provides electronic auctioning and bidding tools to compress sourcing cycle times •Contract management: Helps create and manage value and quantity contracts • Operational Procurement •Self-service procurement: Enables decentralizing procurement process within organization, without diluting the control •Plan-driven procurement: Enables automatic purchase order generation for stock materials across the integrated supply chain •Services procurement: Enables service procurement process to be managed online
Key Components of mySAP• SRM….Contd. Supplier Enablement •Supplier portal: Provides portal features for suppliers to manage their product data and orders •Supplier connectivity: Provides capability to connect multiple suppliers through XM_- based document exchange • Content Management •Content consolidation: Provides capability to consolidate product and vendor information •Catalog content management: Provides capability to manage OCI compatible catalog with tools for data import, data edit and a search engine
Quiz TimeName any one key component of mySAPSRM Solution map
Quiz TimeName any one key component of mySAP SRMSolution map Following are the three key components of mySAP SRM
My SAP Supply Chain Management(SCM) Package 200 - FICO - Infosys 79
mySAP SCM SAP APO (Advanced Planning and Optimizing) Flexible and Adaptive Planning, Integration with CRM, SRM and PLM SAP ICH (inventory Collaboration Hub) Collaboration with Suppliers SAP EM (Event Management) Monitor, alert and resolve exceptions
Typical SAP SCM Solution-scape SAP SCM SAP R/3 Dominant source of Transaction Data Planning system where Master Data in SAP selective Master data SCM, destination of maintained and sourced Core Interface transaction data like from R/3 planning outputs orAvailability Checks for Master Data Execution systems Module includea Demand Planning, SNP & Deployment, PPDS, GATP, TPVS and TLB Core interface Planning Outputs include Forecasts, SNP SAP CRM, or PPDS Planned SAP SRM Orders, Stock Legacy Transfers and and BAPI Production Orders SAP PLM Systems
One-on-One comparison i2 SAP SCM ORACLE APS Manugistics Technologies (Networks (Tradematrix SCM) SCM)Forecasting Demand Demand Oracle Demand Demand Planner/Deman Planner Planner Management d ManagementATP and Demand SAP GATP Oracle GOP FulfillmentFulfillment Fulfillment (Global ATP) (Global Order Management Promising)Material and Supply Chain SAP SNP Oracle ASCP MasterResource Planning (Supply (Advanced Planningplanning Network SCP) Planning)Manufacturing Factory PP/DS Oracle ManufacturingPlanning Planning (Production Manufacturing Planning and Planning and Scheduling Scheduling Detailed
Integration is the Key Challenge Business Drivers Extended Value Network Document Mgmt Increased Market Dynamics Call Center Market Analysis Integration costs are high Long integration projects SCM IT environments become increasingly rigid Lots of heterogeneous systemsERP E-sales Pressure on IT increases Must leverage existing investmentsTrading Must support new business processes quicker E-procurement Must reduce total cost of ownership (TCO) Technical systems PLM
How to Address the Integration Challenge Reduce Complexity • Minimize the number of connections through hubs Document Mgmt Market •Use only one platform to integrate all Call Center Analysis people, information, and systems Reduce Cost Integration SCM ERP •Deliver .NET and J2EE interoperability •Deliver adaptors for ISV products •Deliver products, not projects Increase company E-sales performance •Increase ease of use, scalability and adaptabilityTrading E-procurement •Increase business process flexibility Technical by using an Enterprise Services systems Architecture PLM
The fundamental Web services standardsare supported by the Web ApplicationServer (Web AS), which is the basis for allother NetWeaver components
Theintegration and application platform forlower TCO Unifies and aligns people, information and business processes Integrates across technologies and organizational boundaries A safe choice with full .NET and J2EE interoperability The Business foundation for SAP and partners Powers business-ready solutions that reduce custom integration It’s Enterprise Services Architecture increases business process flexibility
SAP NetWeaver in Detail (SAP Internal View)SAP Mobile Infrastructure Product components and killer features NetWeaverTight coupling and alignment with SAP business solutionsSAP Enterprise Portal SAPBusiness packages People IntegrationCollaboration Multi-channel Access Composite Application FrameworkSAP Business information Warehouse Portal CollaborationBusiness content Life cycle ManagementTight integration to Sap Information IntegrationOpen architecture (Crystal, Accential ) Bus. Intelligence Knowledge Mgmt Master Data ManagementMaster Data ManagementComing in 2003 Process IntegrationSAP Exchange Infrastructure Integration Business ProcessProxy generation and mapping tools Broker ManagementIntegration directorySAP’s ability to execute Application Platform J2EE ABAPSAP Web Application Server Multi-channel AccessProven, scalable, comprehensive toolsetsLeverage existing infrastructure/skillets
NetWeaverBusiness content makes the businessfoundation
SAP Organizational units Package 200 - FICO - Infosys 96
Organizational Structure in SAP Production Planning Financial Accounting Company Plant Code Controlling Human Resources Client Controlling Personnel Area Area Sales and Distribution Materials Management Sales Purchasing Area Organization
SAP Organizational Structure: Cardinality Client Chart of AccountsPurchasing Group Company CodePurchasing Sales Plant Organ. Org. Shipping Storage Distribution Sales Sales Point Channel Office Group Location Loading Division Point
Quiz TimeWhich is not a part of SAP Business Scenario mainElements Master Data Organizational Unit Transaction Document All the aboveAnswer True or False
Quiz Time Which is not a part of SAP Business Scenario main Elements Master Data Organizational Unit Transaction Document All the above Answer True or False One Chart of accounts can be assigned to many Company Codes
Organizational Elements in FICO Package 200 - FICO - Infosys 107
Quiz TimeState True/False Company is obligatory in an organization structureFill in the blank Unit responsible for procurement of materials/services and negotiating with vendors is called ____________.
Quiz TimeState True/False Company is obligatory in an organization structure (False – Company code is obligatory)Fill in the blank Unit responsible for procurement of materials/services and negotiating with vendors is called Purchasing Organization
Organizational Elements in Sales Package 200 - FICO - Infosys 116
Quiz TimeFill in the blanks Sales area is a combination of _____________, ________________ and _______________.
Quiz TimeFill in the blanks Sales area is a combination of Sales Organization, Division and Distribution Channel
Logging on to SAP System Logon pad with different systems
Adding to favorites Steps to add transaction to favorites Step I: Select the transaction you want to add to favorites Step II: Right click on the transaction you want to add to favorites Step III: Select Add to favorites.
General Settings Package 200 - FICO - Infosys 134
Global Settings (at Country level)VariantsCalendar Public Holidays Holiday Calendar Factory CalendarUnit of MeasurementsCurrencies Currency codes Conversions (quotations)
Define Public HolidaysCalendarDefine Holiday Calendar A combination of a yearly 12-month calendar and a list of all public holidays that fall within a calendar year. Gives an overview of all working days and all days off for a calendar year. It can be created to cover a validity period of several years. Can be defined according to the country or region in which they are to be implemented, and adapted to suit individual business requirements
Calendar Calendar Define Factory Calendar in which working days are numbered sequentially. Defined on the basis of a public holiday calendar. Validity period of a factory calendar must be within the validity period of the public holiday calendar. The weekdays that are working days must also be specified in this calendar. Examples: Monday through Friday are working days. Saturday, Sunday and public holidays are non-working days.
• Unit of measurement Enables calculations with quantities and physical units.• Units of measurement are needed for internal conversions (such as kilogram <-> gram, but also centimeter <-> inch).• The international system of units (SI) is used for this.• UOMs are held centrally in the SAP System for all applications.
CurrenciesLegal means of payment in a country.You can manage ledgers in two parallel currencies inaddition to the local currency
Currency codesCurrency settings SAP maintains about 187 currencies. If any transaction in a new currency will happen for the organization, that currency to be maintained Standard quotation Can specify direct or indirect quotation. System by default will take direct quotes. Conversion factors
Exchange Rate Type is used for differentExchange Rate Typebusiness purposes where multiple rates can bemaintained for a pair of currenciesThe following exchange rate types exist Buying rate (G) Bank selling rate (B) Average rate (M) Historical exchange rate Key date exchange rateDefault exchange rate types can be maintained
Exchange Ratethe system for the following Exchange rates in purposes Posting and Clearing To translate amounts posted or cleared in foreign currency, or to check a manually entered exchange rate during posting or clearing. Exchange Rate Differences To determine gains or losses from exchange rate differences. Foreign Currency Valuation
Quiz TimeFill in the blank The difference between ____________ and ____________ is called spread. SAP maintains ___________ number of currencies.
Quiz TimeFill in the blank The difference between Buying rate and Selling rate is called spread. SAP maintains 187 number of currencies.