What is SAP?

SAP is the leading Enterprise Information and Management Package worldwide. Use of this package makes it possible to track and manage, in real-time, sales, production, finance accounting and human resources in an enterprise.

History of SAP

In 1972, five systems analysts began working nights and weekends to create standard software with real time data processing. Twenty-five years later their vision is a reality: SAP is the world’s market and technology leader in business application software.

On April 1, 1972 five former IBM employees founded SAP as Systemanalyse und Programmentwicklung (“Systems Analysis and Program Development”) in Mannheim, Germany. Their vision was to develop and market standard enterprise software which would integrate all business processes. The idea came to them through their work as systems consultants for IBM when they noticed that client after client was developing the same, or very similar, computer programs. The second part of their vision was that data should be processed interactively in real time, and the computer screen should become the focal point of data processing.

From a start-up software vendor to global market leader

Over the course of twenty-five years, their vision has transformed SAP from a small regional enterprise into a world-class international company. Today, the SAP Group is the global market leader in enterprise resource planning software, and has subsidiaries, affiliates and branch offices in nearly every industrial nation in the world. Important milestones in the company's corporate history include its conversion to a GmbH (a closely-held corporation) in 1977, the opening of the company's headquarters in Walldorf, and its conversion into a publicly-held corporation whose shares are listed on several stock markets.

By changing its structure to a publicly-held corporation, SAP significantly strengthened its capital base and laid the foundations for its employees to enjoy more of a share in the company's success. In the end, it is SAP’s employees – currently more than 9,000 of them - whose know-how, motivation and performance have nurtured the company’s progress. And it is their commitment and innovative drive which will pace the company’s future success and keep it ahead of the competition.

Over one million R/3 users

Products have played the central role in SAP's success story. In this area, two milestones stand out: first, the development and 1979 market release of the R/2 software system for mainframes, and, second, the R/3 client/server software system introduced in 1992. Since its debut, the R/3 System use has grown explosively and now accounts for the lion's share of SAP product sales. At present, more than one million end users around the world work with the R/3 System.

The development of SAP products has continually benefited from major advances in the hardware sector. Back in 1972, the limited storage capacity of computers posed one of the biggest challenges. In those days, mainframes only had 500 kilobytes of storage

capacity. Slow data input and output meant that only partial applications with a limited data volume were feasible. It was against this technological background that SAP signed its first customer, the German ICI subsidiary in Östringen.

With the successful implementation of its initial project, SAP had nine employees and, at the end of its first fiscal year, posted a profit on revenues of DM 620,000. In the second year of operation, two local businesses – the tobacco and cigarette manufacturer Roth-Händle and the pharmaceutical company Knoll - selected the newly developed SAP Financial Accounting (RF) System. This system quickly earned a reputation as an excellent standard package and installations expanded to 40 customers. But product development did not slow on this success, and a second standard product, the Materials Management (RM) System, with modules for purchasing, inventory management and invoice verification, soon followed. The benefits of SAP's integration philosophy showed through, with data from Materials Management flowing straight into Financial Accounting.

SAP moves to Walldorf

In its fifth year of operations, SAP became a GmbH (a closely-held corporation) and took on a new name: Systeme, Anwendungen, Produkte in der Datenverarbeitung ("Systems, Applications, Products in Data Processing"). Revenues were now close to DM 4 million, and the number of employees had grown to 25. In 1977, SAP moved its offices and headquarters to Walldorf. In the same year, it signed its first two foreign customers, two companies from Austria. Just one year later, the customer base had grown to 100 and the number of employees stood at 50. SAP had also introduced another central module of the SAP System – Asset Accounting (RA). At the same time, through the development of a French version of the accounting module, SAP made additional steps toward the international markets.

By the end of the 1970s, new generations of powerful computers provided the framework for a comprehensive software system, and a major step in the development of SAP software - the R/2 System – was taken in 1978. In the same year, as sales headed toward the DM 10 million milestones, SAP began operation of its own computer center in Walldorf which, when completed in 1980, united development teams under one roof. That year SAP’s software became even more attractive with the addition of order history to the product range. At the end of 1980, 50 of the 100 largest industrial companies in Germany were SAP customers.

R/2 System goes international

SAP’s close relationships with customers led to continuous enhancements in the existing program modules, while important new additions were made, such as the Cost Accounting (RK) System. The R/2 System was now ready for the international market. New computers with drastically improved price/performance ratios helped expand the customer base, and SAP raised its profile still further by appearing at the Systems trade fair in Munich - the company's first-ever presence at an industry trade show.

In 1982, SAP celebrated its tenth anniversary, with sales soaring 48% to over DM 24 million. By the end of the year, 236 companies in Germany, Austria and Switzerland were working with the SAP standard programs. Sales continued to climb in the following year, increasing by 45%.

In 1984 SAP took additional steps into the international arena with the founding of SAP (International) AG in Switzerland, whose focus was to increase sales of the R/2 System in

international markets. Development teams began work on two new applications, Personnel Management and Plant Maintenance, while the Production Planning and Control System was installed at its first pilot customers.

1985 was characterized by further expansion. The Walldorf headquarters had grown to 10,000 square meters of space, while at the Swiss subsidiary a new headquarters was occupied. SAP systems were now in use in most European countries, and SAP began to penetrate markets outside Europe - with customers in South Africa, Kuwait, Trinidad, Canada and the US.

The DM 100 million sales mark exceeded

SAP continued to pursue international growth with the founding in 1986 of SAP’s Austrian subsidiary SAP Österreich Ges.m.b.H. in Vienna. At the parent company, SAP GmbH, the capital stock was increased from DM 500,000 to DM 5 million. The largest single hardware investment to date was made in Walldorf with the installation of an IBM mainframe costing DM 7 million. The year's sales topped DM 100 million, and SAP exhibited at CeBIT, the world's largest IT trade fair, for the first time.

The 15th year of the company's history was again characterized by powerful growth. Branch offices were opened in Munich and Hamburg, and subsidiaries established in four European countries - the Netherlands, France, Spain and the UK. Staff grew to 750, and sales more than doubled to DM 245 million, with 850 companies now using SAP's software systems. In 1987, SAP announced its strategy for a new generation of software, and the R/3 System was born.

SAP goes public

SAP continued to grow in 1988 with the international sales network strengthened by the establishment of subsidiaries in Denmark, Sweden, Italy and the US. Other events included: the founding of SAP Consulting GmbH as a joint project between SAP and the consulting firm Arthur Andersen; the opening of an International Training Center in Walldorf; and the welcoming of Dow Chemical as SAP’s 1,000th customer. However, the most significant events of the year were the increase of SAP’s capital stock from DM 5 million to DM 60 million, the subsequent conversion of SAP GmbH into a stock corporation, SAP AG, and the flotation of SAP shares on the stock market. SAP shares were quoted on the securities exchanges in Frankfurt and Stuttgart.

During the next year, 1989, SAP shares began trading on the Zurich stock exchange. SAP expanded its alliance and strategic cooperation approaches by taking a majority investment in TOS GmbH in Freiberg. Through the "International User Conference" in Lausanne, Switzerland, and the first "SAPPHIRE" user conference in North America, SAP demonstrated its solid commitment to direct international customer contact. This crucial commitment was to become more and more important to SAP’s success in the coming years.

Over 1,000 employees SAP (International) soon grew to twelve subsidiaries, including Canada, Singapore and Australia. SAP's growing profile in 1989 was evidenced by a number of events: the large number of participants attending the first Annual Stockholders' Meeting, the strong employee growth to more than 1,000, and the expansion of the customer base. Recognizing this success manager magazin named SAP "Company of the Year" – a distinction SAP would receive twice more in the next few years.

In 1990, SAP's capital stock was expanded to DM 85 million with the issue of preference shares. SAP strengthened its commitment to small- and medium-sized businesses by an investment in the software company Steeb and the acquisition of software vendor CAS. In the same year, SAP and Siemens Nixdorf founded SRS GmbH in Dresden, gaining a firm foothold in the East German market. Sales grew strongly to over DM 500 million, and the number of staff grew to 1,700.

SAP develops Russian R/2 version Strong growth continued unabated in 1991. The acquisition of Steeb GmbH was completed and its activities were merged with CAS to form STEEB-CAS GmbH, creating a high-caliber software company with an attractive product offering for the small- and medium-sized company market. With SAP’s Eastern European business developing quickly, SAP collaborated with a local Russian software company to develop an R/2 version in Russian. The first Japanese installation of SAP software was successfully completed. At the end of the fiscal year, the SAP Group boasted 2,225 customers in 31 countries and sales of more than DM 700 million – an increase of over 40 percent. The company had more than 2,500 employees.

In its twentieth year, SAP opened a new Development and Sales Center in Walldorf. The two-year project cost roughly DM 140 million and represented the company's largest single investment to date. In preparation for additional development, SAP’s share capital was expanded by DM 15 million to DM 100 million through the issue of 300,000 preference shares. SAP was now firmly established as a global company, with South Africa, Malaysia and Japan the newest additions to its 15 subsidiary companies. By 1992, almost half of the DM 831 million in product revenues were being generated outside Germany, and the availability of the software in 14 different languages was adding significantly to its attractiveness.

Shipment of the client/server system R/3

With the R/3 System release in mid-1992, SAP began to penetrate the mid-size market, and into branches and subsidiaries of large companies. The release of the R/3 client/server system was the most significant event in SAP’s history and started a record of growth that even SAP’s most optimistic planners had not predicted.

SAP took top position among German software vendors in 1993. On an international scale, the company moved to 7th place among software companies, establishing a clear lead in the global business applications software market. Sales surpassed the important DM 1 billion mark for the first time in 1993, and the global customer base stood at 3,500 companies. SAP made an investment in iXOS Software GmbH with the aim of developing and marketing graphical user interfaces and optical archiving of documents.

New development center in Foster City, California Releases 2.0 and 2.1 provided R/3 users with even more functionality. With the R/3 System already running on six hardware platforms, SAP and Microsoft signed an agreement to port R/3 to Windows NT. Other events included: the founding of SAP’s 18th subsidiary in the Czech Republic, the establishment by SAP America of a development center in Foster City in Silicon Valley, California, and the introduction by SAP Japan of a Kanji version of R/3.

1994 was yet another record-breaking year with sales jumping 66% to over DM 1.8 billion. By the end of the year, SAP employed more than 5,000 staff worldwide, and 200 of the more than 4,000 customers were using the R/3 System in production operation. A Swiss customer was the first customer to go live with R/3 on Microsoft’s Windows NT – a mere four months after the platform became available. Since its rollout in 1992, R/3 had now been installed

more than 1,000 times. SAP development received ISO 9000 certification, and R/3 Release 2.2 was completed on schedule and included a wide range of enhancements in Logistics. SAP continued to expand its sales organization and strategic alliances. In Germany, SAP acquired a 52% stake in DACOS Software GmbH with the aim of developing an integrated software solution for the retail industry. The 19th subsidiary opened in Mexico City.

The Annual Stockholders' Meeting agreed to a DM 400 million capital increase out of retained earnings, bringing total capital to DM 500 million. The resulting 1:4 stock split was positively received by the market and led to a significant increase in stock price levels.

Microsoft chooses R/3 More than 6,000 companies of all sizes were among SAP customers in 1995, some two-thirds of which solved their IT tasks using the R/3 System. During the year Microsoft joined IBM as an R/3 customer from the high-tech sector.

In 1995, R/3 became the largest source of overall revenues, with a DM 1.7 billion share of total sales of DM 2.7 billion. Growth prospects were strengthened still further with the new R/3 Release 3.0, a functional and technical milestone in R/3 development. With this version the important areas of production planning and control were now comprehensively covered. Another technical addition was the availability of R/3 on the widely used IBM AS/400 platform.

The indirect sales channel concept was introduced in Germany, with SAP forming partnerships with value-added resellers so as to better support small- and medium-sized businesses. A new Service and Support Center opened in Walldorf with room for some 750 employees. SAP now employed more than 7,000 staff.

Global profile: SAP represented in 40 countries In 1995, SAP further increased its international activities with new subsidiaries formed in China, Argentina, Brazil, Korea, Poland, Russia and Thailand. SAP was now represented in over 40 countries by subsidiaries, branch offices or partner companies. An industry solution for the process industry (eg., chemicals, pharmaceuticals, food and beverage industry, and semiconductors) was announced in the US.

With 1,400 stockholders and guests, the number of attendees to the 1995 Annual Stockholders' Meeting was more than triple the 1994 figure, and the ASM approved changing the par value of SAP shares from DM 50 to DM 5. Shortly thereafter SAP entered the German stock index (DAX). Both events had a positive effect on share prices.

Sales reach DM 3.7 billion in SAP's anniversary year

SAP's success continued into its 25th year of operations, with sales exceeding DM 3.7 billion. Over the course of its 25-year history, SAP showed that business processes can be modeled in a standard way across and within industry sectors. When the IT industry developed flexible and cost-effective client/server architecture, SAP provided its customers with the right product at the right time - the R/3 client/server system.

R/3 becomes Internet-enabled The success of R/3 has propelled SAP to the top of the global software market. IT is undergoing yet another revolution with the advent of the Internet, and SAP is again there with a solution: the latest version of R/3 provides the first comprehensive, Internet-enabled

business application package. Release 4.0, which is already in development, further increases the attractiveness of the R/3 System by making it more user-friendly. Small and mid-sized businesses should especially welcome this development. The R/3 System is here to stay, and users can look forward to its continuing enhancement

SAP Systems

SAP markets two main products: R/2 and R/3. The two products share many features and provide similar functionality such as:

Provide an integrated suite of software application modules. The modules cover the requirements of most companies who can purchase those components which they require.

Provide real-time database update for integrated applications. Thus when a business transaction such as the receipt of inventory occurs, the entry into the system will immediately be affected in the Inventory Reports and in the Financial Ledger.

Support organizations with multiple companies in different locations. Support any number of currencies within the organization. If item is posted to the system

in foreign currency, it is also entered into the system in the company’s local currency. Support multiple languages. The user specifies their native language when signing on to

the system and subsequent screens appear the chosen language. Suitable to wide range of industries and organizations. The software can be tuned to

practically any company’s' requirements through configuration and customization.

The applications' programs are driven by table entries which are configurable by the client. Extensive customization is also possible with the provision of the SAP programming language ABAP. A large part of the software is written in ABAP and is available for modification. ABAP is most widely used for reports; however it is also used for interface programs, database updates, and for new online transactions. If the standard software does not provide the required functionality, it is possible to write a whole new application with ABAP.

SAP's major criticism has been the cost of it's software and implementation. SAP and various consulting companies have addressed the issue of implementation costs by creating industry-specific templates.

R/2 System

R/2 is the SAP mainframe solution and has been around for many years. The current version is 6.0. The hardware required limits it's suitability to large and very large companies.

It consists of the following modules:

RS Basis System (includes ABAP/4 programming language) RF Financial Accounting RA Asset Accounting RK Cost Accounting RK-P Project Costing RM-INST Plant Maintenance RM-MAT Materials Management RM-PPS Production Planning and Control RM-QSS Quality Assurance RP Human Resources RV Sales and Distribution

The architecture is such that the applications and database reside on one mainframe computer. Users who are remote from the mainframe may establish a dial-in connection or be permanently connected through a leased line. Having a centralized mainframe computer system can have distinct advantages to a large company.

Consolidation for Groups is made easy due to all relevant data residing on the one system. Particularly attractive to such companies is the fact that all transactions of regional offices can be reflected in the Group's Consolidation Reports immediately.

Reports from regional offices can follow a standard format. i e. The same reporting programs can be used with all users conforming to the same Chart of Accounts. They are not subject to manipulation and can offer a true comparison of performance.

New corporate policy can be implemented throughout all offices by changing the configurations of the centralized SAP system. For example, a new transaction may install that requires purchases over $1000 to attain Head Office approval before an Order can be placed in the system.

Mainframe systems currently retain greater processing power over client-server machine although the gap is closing.

Centralized mainframe systems have the following disadvantages: High setup costs. Typically costs associated with components are higher with

mainframes. Mainframe system tends to proprietary-based which reduces competition and inevitably raises prices.

High maintenance costs. Mainframe systems will typically require an operations team to perform ongoing technical tasks (such as initiating batch jobs, restarting printers and fine tuning performance)

Communications problems are more likely for a mainframe if regional offices are far away from the mainframe. The cost of these connections can also be high.

Less user-friendly interface possible with Mainframe terminals. R/2 is also available with a front-end interface called "CUA". This is installed on PC Workstation which can connect as a mainframe terminal. CUA provides a Windows-type interface based on the interface provided by SAP R/3.

R/3 System

R/3 is the SAP client-server solution and has been around for approximately five years. The current version is 3.1. It has proved hugely popular in many countries. Demand in the United States is particularly high at present. The solution is available to many more companies than R/2 as a mainframe is not required.

It consists of the following modules:

BC Basis (includes ABAP/4 Programming Language) AM Asset Management CO Controlling FI Financial Accounting HR Human Resources IS Industry Specific Solutions PM Plant Maintenance PP Production Planning PS Project System QM Quality Management SD Sales and Distribution MM Materials Management WF Business Work Flow

The architecture consists of application servers and database servers with PC users established as clients of these servers on the network. The applications servers provide the application software while the database servers handle the update of document and master file databases. The system can support any number of servers in many different hardware configurations. There is no restriction on numbers of users as it is always possible to link more servers to the network. This makes R/3 scalable and suitable to many different types and sizes of organization.

A decentralized client server solution can provide the following advantages:

Possible to achieve near instant response times. Greater available time to users. The mainframe solution requires regular batch jobs to be

run without users logged on to the system making. R/3 still requires batch jobs but is possible to achieve a greater window of available time.

A friendlier user interface is possible with PC workstations as opposed to dumb mainframe terminals.

The architecture promotes open systems, where components and peripherals can be used from multiple vendors thus promoting competition and reducing hardware costs.

Eight Reasons to Use SAP R/3 Global Basis Faster Speed Flexibility for Changes (Business & IT) Agility Extended Supply Chain Management Reach New Opportunity Knowledge Sharing Creativity Focus

Facts about SAP

Founded by five former IBM employees in 1972 Walldorf, Germany. Leading global provider of client/server business software solutions. Number one vendor of standard business application software, with a

worldwide market share of 31%. Fourth-largest independent software supplier in the world. Available in 14 languages. 34% of SAP's customers worldwide are under $200 million. 10 out of the top 10 US companies with the highest market value use SAP

software. 8 of the top 10 largest US corporations use SAP software. 8 of the top 10 highest profit US companies use SAP software. More than 7500 customers in over 90 countries have chosen SAP. Reported revenues of DM 6 billion in the most recent fiscal year, a 62-percent

increase over 1996 revenues. SAP is not any longer a one-product-company

What Makes SAP different?

Traditional computer information systems used by many businesses today have been developed to accomplish some specific tasks and provide reports and analysis of events that have already taken place. Examples are accounting general ledger systems. Occasionally, some systems operate in a "real-time" mode that is, have up to date information in them and can be used to actually control events. A typical company has many separate systems to manage different processes like production, sales and accounting. Each of these systems has its own databases and seldom passes information to other systems in a timely manner.

SAP takes a different approach. There is only one information system in an enterprise, SAP. All applications access common data. Real events in the business initiate transactions. Accounting is done automatically by events in sales and production. Sales can see when products can be delivered. Production schedules are driven by sales. The whole system is designed to be real-time and not historical.SAP structure embodies what are considered the "best business practices". A company implementing SAP adapts it operations to it to achieve its efficiencies and power. The process of adapting procedures to the SAP model involves "Business Process Re-engineering" which is a logical analysis of the events and relationships that exist in an enterprise's operations.

SAP Application Modules

SAP has several layers. The Basis System is the heart of the data operations and should be not evident 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:

FI Financial Accounting--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.

CO Controlling--represents the company's flow of cost and revenue . It is a management instrument for organizational decisions. It too is automatically updated as events occur.

AM Asset Management--designed to manage and supervise individual aspects of fixed assets including purchase and sale of assets, depreciation and investment management.

PS Project System--is designed to support the planning, control and monitoring of long-term, highly complex projects with defined goals.

WF Workflow--links the integrated SAP application modules with cross-application technologies, tools and services

IS Industry Solutions--combine the SAP application modules and additional industry-specific functionality. Special techniques have been developed for industries such as banking, oil and gas, pharmaceuticals, etc.

HR Human Resources--is a complete integrated system for supporting the planning and control of personnel activities.

PM Plant Maintenance--In complex manufacturing process maintenance means more than sweeping the floors. Equipment must be services and rebuilt. These tasks affect the production plans.

MM Materials Management--supports the procurement and inventory functions occurring in day-to-day business operations such as purchasing, inventory management, reorder point processing, etc.

QM Quality Management--is a quality control and information system supporting quality planning, inspection, and control for manufacturing and procurement.

PP 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.

SD Sales and Distribution--helps to optimize all the tasks and activities carried out in sales, delivery and billing. Key elements are; pre-sales support, inquiry processing, quotation processing, sales order processing, delivery processing, billing and sales information system.

Each of these Modules may have sub-modules designed for specific tasks as detailed below.

System-Wide Features

SAP uses certain system wide features that should be understood at the outset. These are used to logically, safely and flexibly organize the data in a business enterprise.

Customizing-- is the configuring of the system to represent your organization's legal structure, reporting requirements and business processes. Internal reporting is a managerial tool in the daily operations. External reporting is required by governmental units controlling the legal structure of the corporation, such as, the IRS state taxing authorities, SEC etc.

Organizational Elements o Financial--

client is a legal and organizationally independent unit at the highest level in SAP

company is an independent legal entity within a client business areas are used to produce profit and loss statements and

balanced sheets across marketing lines o Materials Management

Purchasing units Plants

o Sales and Distribution Sales Organization Distribution channel Division

Master Data is records that remain in the database over an extended period of time. Examples:

o Customer Master o Vendor Master o Material master o Account Master

This structure eliminates redundant data and is shared by all SAP Modules. It is a critical aspect of the robustness of the system.

Employee Self Service--your employees have access to the own HR records over the Internet.

Classification is the assignment of object s to a class. Each class has standard characteristics.

Match codes are query tools used to find specific information using search methods. Security is administered for objects, profiles and authorizations. Users are only

authorized to see or change the parts of the system required by their job responsibilities.

Business Processes and SAP Functionality

In order to understand a system like SAP a thorough understanding of the events and relationships that take place in a business is required. It is not enough to just realize the Sales, Production, Finance and Accounting have jobs to do in a business. The exact details of each action, the timing of that action and its interrelationships with every other process must be understood. In many large operations there may be no person that has a complete grasp of the situation. Before an operation can be automated or computerized a thorough study of the business must be undertaken. This task is called Business Process Engineering.

Sequential Walk Through Sales

o Pre-sales activity--planning and availability support for the sales personnel o Sales Order--The actual entry of the sales order into the system done by the

salesperson at the point of sales perhaps using a PC and Internet connections. o Determining where the most efficient source of the ordered product is in

inventory and shipping it. o Delivery o Customer Billing o Customer Payment

Production o Sales and Operations Planning SOP where the sales forecasts are used in a

production planning model to check feasibility. o Master Production Scheduling MPS--The actual plan for the whole production

process o Material Requirements Planning MRP--Where the production plan is actually

converted into raw materials input requirements. o Planned Order--When materials are available and capacity exists this plan is

created and then converted into a o Production Order. o Shop Floor Control where the actual production takes place and is registered into

the system as finished goods. o Purchasing

Requisition--Once the Production manager plans to manufacture something a requisition for the raw materials required but not on hand must be prepared.

Vendor Selection--made by the purchasing department Purchase order sent goods receipt increasing inventory Invoice verification as it is received from vendor Payment to vendor.

Finance and Accounting

Sales events must be captured at the proper time into the ledger system Inventory must be adjusted to match goods shipped Inventory must be adjusted to match raw materials received Inventory must be adjusted to move value from raw materials to work in

process Inventory must be adjusted to increase finished goods when they are

produced Accounts Payable must be set up for purchases Accounts Receivable must reflect goods billed but not yet paid for

Business Process Engineering must not only identify all these steps but must also find the most efficient way to minimize redundant actions. For example, when sales are made, inventory and manufacturing plans should be automatically updated. When manufacturing plans are updated raw materials should be automatically ordered from vendors. When finished goods are shipped customers should be automatically billed at the same instant. Real situations are far more complex than the simple explanation above.

Quick Tour of the SAP User Interface

The SAP R/3 system presents a Windows interface with several of the familiar Windows functions for screen manipulation. The apparent simplicity of the interface hides the power of the menus residing within the menu bar at the top of the screen. The initial screen shows a menu bar with the following selections. The first level sub menus are listed below to give you an idea of where to start:

o Office Workplace Telephone Integration Appointment Calendar Room Reservations Start Workflow Business Documents

o Logistics Materials Management Sales/distribution Logistics Execution Production Production-process Plant Maintenance Customer Service Quality Management Project Management Environment Health & Safety Central Functions

o Accounting Financial Accounting Treasury Controlling Enterprise Control Investment Mgt. Project management Real Estate

o Human Resources Managers Desktop Personnel admin. Time management Payroll Training and Event Management Organizational Management Travel Information system

o Information Systems Executive Information Systems Logistics Accounting Human Resources Project System Ad Hoc Reports General Report System

o Tools ABAP/4 Workbench Accelerated SAP Administration ALE Business Communication Business Documents Business Framework Business Workflow CCMS Web Development SAP Script Hypertext Find

R/3 System Overview

INTEGRATION Integrated Processes

o Operational. financial, and managerial principles are satisfied simultaneously o Common Database

Application Integration o One point of data entry o Consistency across all user applications

Technical Integration o On-line interactive edit and update o Elimination of redundant data\ o Data Integrity

Designed for all Types of Business Provides a complete business solution across all business functions. System addresses critical business processes and provides an enterprise-wide solution:

o One system supports global business and accounting practices. o Standardized business processes across the organization, yet tailoring by

individual business units is allowed.

o Supports multiple business structures per business process to accommodate differences between business units

Worldwide Usage Comprehensive multi-currency translation Multiple language support Customized reporting and document generation for individual countries Multi-company support Local support in most major industrialized countries Country specific functionality

REAL-TIME PROCESSING Transactions within system update the underlying databases immediately

Open System R/3 allows the interplay and portability of applications, data and user interfaces Based on international standards for interfaces, services and data formats Architecture is aligned with recognized open systems standards

FLEXIBILITY Customers can customize business modules to realize best business practices System provides necessary interfaces to incorporate external software. Scalability, accommodates acquisitions and growth System can be configured the way you want to do business in the future Allows customized screens processing and reports System runs on multiple hardware platforms

STRUCTURE

Application Models System consists of application models that support all of a company's business

transactions and are integrated in real time A change in one application module results in an automatic update of the data in

the other application modules All applications have the same "look and feel"

Modules Grouping Financials:

o FI Financial Accounting o CO Controlling o AM Asset Management o PS Project Systems

Common Systems o WF Workflow

o IS Industry Solutions Logistics

o PM Plant Maintenance o QM Quality Management o PP Production Planning o MM Materials Management o SD Sales and Distributiono HR Human Resourceso The Basis System

SYSTEM WIDE PROCESSING CAPABILITIES Workflow Archiving Reporting Conditions Batch Input Output

SYSTEM INTEGRATION

SUMMARY