Introduction to SAP

Renuka Aradhey

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 1. What is SAP?
SAP stands for Systems, Applications, and Products in Data Processing. It's a German
multinational software corporation that makes enterprise software to manage business
operations and customer relations. SAP is particularly well-known for its ERP (Enterprise
Resource Planning) software, which helps companies integrate various business processes
such as accounting, human resources, supply chain management, and procurement into
one system. SAP's software is used by a wide range of industries and businesses of all sizes
around the world.

2. When was SAP was introduced and who are the founding members?
SAP was founded in 1972 by five former IBM engineers: Dietmar Hopp, Hasso Plattner,
Claus Wellenreuther, Klaus Tschira, and Hans-Werner Hector. They initially started SAP as
a company developing software for enterprise resource planning (ERP) in Walldorf,
Germany. The company's first product was called SAP R/1, which was launched in 1973.
Since then, SAP has grown to become one of the largest software companies in the world,
with its products used by thousands of businesses globally.

3. What is Erp Software?

ERP stands for Enterprise Resource Planning. ERP software is a type of business
management software that integrates various core business processes and functions into a
single system. These processes typically include:
1. Finance and Accounting: Modules for managing financial transactions, budgeting,
accounts payable and receivable, general ledger, and financial reporting.
2. Human Resources: Modules for managing employee data, payroll, benefits
administration, recruitment, performance evaluation, and training.
3. Supply Chain Management: Modules for managing procurement, inventory, order
processing, manufacturing, distribution, and logistics.
4. Customer Relationship Management (CRM): Modules for managing customer
data, sales automation, marketing campaigns, customer service, and support.
5. Project Management: Modules for planning, scheduling, resource allocation, and
tracking of projects and tasks.
By integrating these functions into a single system, ERP software enables companies to
streamline their operations, improve efficiency, and make more informed decisions based
on real-time data. It provides a centralized database that allows different departments to
share information and collaborate more effectively. ERP systems are scalable and
customizable to meet the specific needs of different industries and organizations.
4. List of ERP Service Providers
• SAP • Salesforce

• Oracle • Baan

• Tally • Abas

• Sage • Plex

• . Net • IFS

• Infor Cloud Suite

❖ SAP S/4 HANA currently supports 44 Languages.

❖ SAP Services available in 190+ Countries.
 5. Modules Present in SAP

SAP S/4HANA is a modular ERP (Enterprise Resource Planning) system that encompasses
various functional modules designed to support different aspects of business operations.
The specific modules available in SAP S/4HANA can vary depending on the version and
configuration, as well as the industry-specific needs of the organization. However, some of
the core modules commonly found in SAP S/4HANA implementations include:

1. Finance (FI) 13. Warehouse Management

(WM)
2. Controlling (CO)
14. Transportation Management
3. Materials Management (MM)
(TM)
4. Sales and Distribution (SD)
15. Extended Warehouse
5. Production Planning (PP) Management (EWM)

6. Quality Management (QM) 16. Customer Relationship

Management (CRM)
7. Plant Maintenance (PM)
17. Advanced Planning and
8. Project System (PS)
Optimization (APO)
9. Asset Management (AM)
18. Product Lifecycle
10. Human Capital Management Management (PLM)
(HCM)
19. Environment, Health, and
11. Supplier Relationship Safety (EHS)
Management (SRM)
20. Governance, Risk, and
12. Enterprise Asset Management Compliance (GRC)
(EAM)

These are just some examples of the modules available in SAP S/4HANA. Depending on the
organization's requirements and the version of SAP S/4HANA being used, there may be
additional modules or variations in module names and functionalities.
 6. What is FICO stands for?

1. Finance (FI): The Finance module, often abbreviated as FI, is one of the core
modules in SAP S/4HANA. It handles all financial transactions within the organization
and provides tools for financial accounting and reporting. Key functionalities of the FI
module include:

• General Ledger (GL): Recording all financial transactions of the company,

such as revenue, expenses, assets, and liabilities.

• Accounts Payable (AP): Managing payments to vendors and suppliers,

including invoice processing, payments, and reconciliation.

• Accounts Receivable (AR): Managing incoming payments from customers,

including invoice generation, credit management, and collections.

• Asset Accounting: Tracking and managing fixed assets, including

acquisition, depreciation, retirement, and valuation.

• Financial Reporting: Generating financial statements such as balance

sheets, income statements, and cash flow statements to provide insights
into the financial health of the organization.
2. Controlling (CO): The Controlling module, abbreviated as CO, complements the
Finance module by providing tools for internal reporting, analysis, and decision-
making. It helps management monitor and control costs, analyze profitability, and
plan for future business activities. Key functionalities of the CO module include:

• Cost Element Accounting: Classifying and tracking costs according to cost

elements, such as materials, labor, and overhead.

• Cost Center Accounting: Allocating costs to different cost centers within the
organization to track expenses and analyze performance.

• Profit Center Accounting: Analyzing the profitability of different business

segments or units within the organization.

• Internal Orders: Managing and controlling costs associated with specific

projects, investments, or activities.

• Product Costing: Calculating the cost of goods manufactured or services

provided, including direct materials, labor, and overhead costs.
Together, the Finance and Controlling modules in SAP S/4HANA provide comprehensive
tools for managing financial processes, controlling costs, and analyzing the financial
performance of the organization.
 7. High Level Architecture of SAP
Technical architecture of SAP refers to a systematic arrangement of elements that are
needed for deploying and running SAP Software. It involves the Hardware, Software and
network component carefully to ensure better integration, scalability and optimal
performance.
SAP Application Layer: This layer consists of the SAP applications themselves, such as
SAP ERP, SAP S/4HANA, SAP CRM, etc. These applications handle business processes like
finance, sales, procurement, manufacturing, etc.
1. Database Layer: SAP applications typically run on top of a database management
system (DBMS) such as SAP HANA, Oracle, Microsoft SQL Server, or IBM Db2. The
database layer stores and manages the data used by SAP applications.
2. Application Server: SAP systems utilize application servers to process business
logic and serve requests from clients. The application server hosts the SAP software
and manages communication between the SAP applications and the database.
3. Presentation Layer: This layer includes the user interface components through
which users interact with the SAP system. It could be SAP GUI (Graphical User
Interface), SAP Fiori (for a more modern and responsive user experience), or other
interfaces.
The specific architecture of an SAP system can vary depending on factors such as the SAP
products being used, the size and complexity of the implementation, deployment model
(on-premises, cloud, hybrid), and organizational requirements.

8. Platform Independent Architecture & System Landscape

1. Platform Independent Architecture

In SAP, the term "platform-independent architecture" refers to the design principle that SAP
software can run on various hardware and operating system platforms. This architecture
enables SAP applications to be deployed on different environments without significant
modifications to the underlying codebase.
In terms of system landscape, SAP defines different system environments for managing the
lifecycle of SAP applications, from development to production. The typical SAP system
landscape includes:
 1. Development System: Also known as the DEV system, this environment is used by
developers to customize and develop SAP applications. It is where new
functionalities are developed, tested, and refined before being deployed to other
environments.
2. Quality Assurance/Test System: The QA system is used for testing changes and
developments made in the development environment. It allows for thorough testing
of new functionalities, configurations, and system integrations before promoting
them to the production environment.
3. Production System: The PROD system is the live environment where the SAP
application is used for day-to-day operations. It hosts the official version of the SAP
application and stores the organization's critical business data.
4. Training System: Some organizations also maintain a separate system for training
purposes. This environment allows end-users to familiarize themselves with the SAP
application without affecting the development, testing, or production environments.
The system landscape can vary depending on organizational requirements, with some
organizations having additional systems for specific purposes such as sandbox
environments for experimentation or disaster recovery systems for business continuity.

ASAP Methodology

The ASAP (Accelerated SAP) methodology is a framework for effectively implementing SAP
software solutions in an organization. It provides a structured approach to manage the
entire lifecycle of an SAP implementation project, from planning and preparation to post-
implementation support. The ASAP methodology is designed to accelerate the
implementation process, minimize risks, and ensure the successful deployment of SAP
solutions.
Here are the key phases of the ASAP methodology:
1. Project Preparation: In this phase, the project team is assembled, project goals
and objectives are defined, and the project plan is created. This phase also involves
identifying stakeholders, establishing project governance, and setting up project
infrastructure.
2. Business Blueprint: The Business Blueprint phase involves gathering and
documenting the business requirements of the organization. This includes
conducting workshops with key stakeholders to understand current business
 processes, identifying gaps between existing processes and SAP best practices, and
defining the future state business processes to be supported by SAP.
3. Realization: In this phase, the focus shifts to configuring the SAP system to meet
the requirements defined in the Business Blueprint. This involves customizing SAP
modules, developing custom enhancements, and integrating SAP with other
systems as necessary. End-user training and testing activities also take place during
this phase.
4. Final Preparation: The Final Preparation phase involves conducting end-to-end
testing of the SAP system to ensure that it meets the requirements and is ready for
deployment. This includes performing system integration testing, user acceptance
testing, data migration, and finalizing the cutover plan for transitioning to the new
system.
5. Go-Live and Support: The final phase of the ASAP methodology involves deploying
the SAP system into production and providing support to end-users during the initial
period after go-live. This includes monitoring system performance, addressing any
issues that arise, and providing training and support to end-users as needed.