Thursday, April 17, 2008

SAP Overview

Topics Covered:
1. Data Warehousing
2. Evolution of ERP
3. SAP
4. SAP Offering – At a Glance
5. SAP Architecture & Hardware Base ( Network Technology )
6. Hardware Partners
7. Terminology
8. SAP R /3 System—The ERP Backbone
9. SAP R/3 Enterprise
10. SAP R/3 Enterprise Architecture
11. SAP R/3 ERP Availability
13. SAP Solutions

Data Warehousing

In essence, data warehousing is intended to provide an architectural model of the flow of data from operational systems to decision support environments. It attempted to address the various problems associated with this flow, and the high costs associated with it. In the absence of such architecture, there usually existed an enormous amount of redundancy in the delivery of management information. In large corporations it was typical for multiple decision support projects to operate independently, each serving different users but often requiring much of the same data. The process of gathering, cleaning and integrating data from various sources, often legacy systems, was typically replicated for each project. Moreover, legacy systems were frequently being revisited as new requirements emerged, each requiring a subtly different view of the legacy data.

Based on analogies with real life warehouses, data warehouses were intended as large scale collection/storage/staging areas for legacy data. From here data could be distributed to “retail stores” of “data marts” which were tailored for access by decision support users. While the data warehouse was designed to manage the bulk supply of data from its suppliers, and to handle the organization and storage of this data, the retails stores of data marts could be focused on packaging and presenting selections of the data to end-users, often to meet specialized needs.

Evolution of ERP:

The costs of data warehousing projects are usually high considering the collection, cleaning & integrating of data from different sources – often legacy systems. The exercises are inevitably labour-intensive and time consuming. Many companies have been instituting enterprise resource planning software to coordinate the common functions of the enterprise having central database as hub, allowing applications to share and reuse data more efficiently than previously permitted by separate applications. Existence of a central ERP database has created the opportunity to develop enterprise data warehouses for manipulating that data for analysis.

Enterprise Resource Planning - ERP is an industry term for integrated, multi-module application software packages that are designed to serve and support multiple business functions. An ERP system can include software for manufacturing, order entry, accounts receivable and payable, general ledger, purchasing, warehousing, transportation and human resources. Evolving out of the manufacturing industry, ERP implies the use of packaged software rather than proprietary software written by or for one customer. ERP modules may be able to interface with an organization's own software with varying degrees of effort, and, depending on the software, ERP modules may be alterable via the vendor's proprietary tools as well as proprietary or standard programming languages.


In 1972, five former IBM employees launch a company called SAP Systems Analysis and Program Development in Mannheim, Germany with the vision - to develop standard application software for real-time business processing. One year later, the first financial accounting software is complete, forming the basis for the continuous development of other software components in what later came to be known as the "R/1 system." "R" stands for real-time data processing. By the end of the decade, intensive examination of SAP's IBM database and dialog control system leads to the birth of SAP R/2.

The SAP R/2 system attains the high level of stability of the previous generation of programs. Keeping in mind its multinational customers, SAP designs SAP R/2 to handle different languages and currencies. With this and other innovations in SAP R/2, SAP sees rapid growth. By the middle of the decade, SAP founds its first sales organization outside Germany, in Austria. The company makes its first appearance at the CeBIT computer fair in Hanover, Germany.

In August 1988, SAP GmbH becomes SAP (System, Application & Products in Data Processing) AG. The client-server concept, uniform appearance of graphical interfaces, consistent use of relational databases, and the ability to run on computers from different vendors meets with overwhelming approval. With SAP R/3, SAP ushers in a new generation of enterprise software - from mainframe computing to the three-tier architecture of database, application, and user interface.

With the Internet, the user becomes the focus of software applications. SAP develops mySAP Workplace and paves the way for the idea of an enterprise portal and role-specific access to information. SAP is the world's third-largest independent software vendor. Today, based on Enterprise Services Architecture and the underlying integration and application platform, SAP is providing its customers with solutions for end-to-end business processes. With SAP NetWeaver, companies can integrate people, information, and processes within the company and beyond.

SAP Offering – At a Glance:

SAP has been traditionally involved in helping customers modernize their back-office operations by integrating business processes, mostly with its standard enterprise resource planning software called SAP R/3.The traditional SAP R/3 ERP system offers transaction and reporting functionality in the areas of financial, logistics and human resource applications enabling the exchange of data between a company’s various business units or divisions. The standard-business-process-fits all approach of SAP R/3 often required business process reengineering to meet the business needs. Because this could only address a limited portion of the market’s needs. SAP began offering industry specific solutions and extended ERP solutions including managing supplier relationships with supply chain management, managing the distributors, resellers and customer with customer relationship management (CRM) solutions, and managing the knowledge assets with business intelligence (BI) solutions. In the traditional ERP world, companies first focused on getting their own in-house business processes under control and integrated. Business communication (such as placing orders or transferring financial data) within a company usually happened with SAP’s Application Link Enabling protocol (ALE). Business communication with outside partners usually happened with Electronic Data Interchange (EDI) or in worst case per fax. This ALE or EDI communications was with known and established business partners, because these links had to be set up for each channel. In any case, these ERP systems were not as open to the outside world as the Internet has now enabled. Yet, they are the first implementation step needed before exposing the in-house business processes to the outside internet world.

The evolving customer centric internet business world, with its HTTP & XML communication protocols and need to de business anywhere and at any time, has enabled business collaboration to take place. Instead of communicating with known and established business partners, now an entire electronic community can perform business transactions among each other in electronic marketplace portals. In response, SAP introduced and the four main SAP internet strategy elements: Marketplace Workplace Business Applications Application Hosting

The electronic communities and marketplace portals will enable the evolution from traditional ERP to extended ERP, leading to a value collaboration network. Finding innovative ways to collaborate with partners is quickly becoming a business requirement for companies that want to stay competitive in the new internet economy. By building the web-extended enterprise, businesses are able to achieve maximum value from their people and networks – by integrating processes with those of their partners and suppliers to better respond to customer needs.

The initiative is totally repositioning SAP AG and its business application products to establish a unique business software ecosystem for the interconnected world. The traditional SAP R/3 application software is now one of several business application components in the offering, along with the extended ERP application components, web-enabled marketplaces and workplaces. This new application components model results in increasing server, storage and network infrastructure requirements. Business Scenarios combines intra- and inter-enterprise services, information, and application components. These form collaborative business scenarios in the areas of e-Commerce, Customer Relationship Management, Supply Chain Management, Business Intelligence, and Enterprise Resource Management.

The entire gamut of solutions is grouped in three main categories:
Cross-Industry Solutions
Industry Solutions
Infrastructure and Services Solutions
The functionality of each of these solutions is delivered through their underlying technical components, such as SAP R/3, SAP BW, and SAP APO.
SAP NetWeaver is the application and integration platform to unify and align people, information and business processes across technologies and organizations. SAP NetWeaver currently consists of the following products:
· Web Application Server
· Enterprise Portal
· Business Information Warehouse
· Exchange Infrastructure
· Knowledge Management
· Mobile Infrastructure
· Master Data Management
· Composite Application Framework
· Life Cycle Management

SAP Architecture & Hardware Base ( Network Technology )
The SAP R/2 system runs on mainframes like IBM, BS 2000 (Seimens machines) or Amdahl. The next version, SAP R/3 client/server software system has been designed for open systems like UNIX. Recent developments involve splitting complex applications into increasingly many pieces, commonly including such components as the following:
· Database Server
Data resides within a relational database system.
· Presentation Server (often called the ‘client')
The user interacts with this server
· Transaction Processor (or TP Monitor)
This provides a proxy that manages updates to the database. A user may ask to update information about an invoice; the TP Monitor manages ensuring that all of the resulting database updates are performed.
· Application Server
This is an execution environment where one can run application code, typically involving the business logic for things like reports or batch processing.
It is somewhat preferable for this ``tier'' to be able to run on a variety of sorts of hardware, which would encourage the use of platform-independent systems such as Java.
Alternatively, or perhaps in combination, it makes sense to use standardized `application splitting' schemes such as CORBA (Common Object Request Broker Architecture) whereby the application would be split into object components that communicate through an Object Request Broker (ORB).Quite a lot of application server systems are available for Linux.
· Print/Output Server
· Message Server, Lock Server

SAP's R/3 system is one of the more sophisticated such multi-tier systems. The only component of those listed above that it does not really visibly separate out as a separate component is the TP Monitor.

Presentation server: Local PC that has SAPGUI.
Application server: The application server is used to run the business application programs in the R/3 client/server concept. The application modules are loaded from the data base server to the application server as required. Thus the application server requires only storage capacity to accommodate UNIX, Swapping and the SAP runtime environment.
Database server: The data base server stores the SAP application programs and data in the R/3 client/server concept. It also handles the SAP update program and batch jobs. SAP has established a partnership with IBM which provides a wide choice of servers, operating systems and databases for implementing R/3. These servers provide scalability, performance, high availability and investment protection needed to support a successful R/3 implementation.
RS/6000 for UNIX, AS/400 Advanced Series for integrated server and database platform, PC servers for reliable Microsoft NT solutions, S/390 database servers and DB2 family for database support. IBM Netfinity 7000 and IBM PC Server 330 and 704 provide the reliable foundation you need for SAP R/3 applications for Microsoft NT. The platforms offered by IBM provide latest Pentium Pro technology, Ultra fast throughput, Storage flexibility and upgradable system components. SAP R/3 runs on a variety of databases such as Oracle, Informix, Online, ADABAS-A, DB2 for UNIX, DB/400, Microsoft SQL Server 6 and on an experimental version on DB2 for MVS. SAP R/3 is based on various hardware and software architectures. It scales very well on SMP systems and MPP architectures. The latest version of R 4.1 which is still in the developmental stage provides the Internet compatible business application package.

Hardware Partners

Since there are so many different platforms available in today's market, compatibility between SAP and the customer's platform, Hardware partners play a very important role. Hardware partners are leading hardware vendors who provide the computing hardware necessary to meet a customer's system requirements. Working with both SAP and customers, hardware partners continually develop and optimize products to meet the running business applications with SAP software. Hardware partners have developed organizations to provide strong SAP support, from product selection to system set-up, installation and ongoing performance tuning.
Some of the hardware partners are Amdahl, IBM, Bull, NCR, Compaq, NEC, Data General, Sequent, Dell, Tandem, Digital, Siemens Nixdorf, Fujitsu, Sun, Hewlett-Packard, Sun, Unisys, Hitachi and Intergraph.

Mainframe: Mainframe is an industry term for a large computer, typically manufactured by a large company such as IBM for the commercial applications of Fortune 1000 businesses and other large-scale computing purposes. Historically, a mainframe is associated with centralized rather than distributed computing. Today, IBM refers to its larger processors as large servers and emphasizes that they can be used to serve distributed users and smaller servers in a computing network.

Client/Server Model: Client/server describes the relationship between two computer programs in which one program, the client, makes a service request from another program, the server, which fulfills the request. Although the client/server idea can be used by programs within a single computer, it is a more important idea in a network. In a network, the client/server model provides a convenient way to interconnect programs that are distributed efficiently across different locations. Computer transactions using the client/server model are very common. For example, to check bank account from computer, a client program in computer forwards the request to a server program at the bank. That program may in turn forward the request to its own client program that sends a request to a database server at another bank computer to retrieve account balance. The balance is returned back to the bank data client, which in turn serves it back to the client in personal computer, which displays the information.
The client/server model has become one of the central ideas of network computing. Most business applications being written today use the client/server model. So does the Internet's main program, TCP/IP. In marketing, the term has been used to distinguish distributed computing by smaller dispersed computers from the "monolithic" centralized computing of mainframe computers. But this distinction has largely disappeared as mainframes and their applications have also turned to the client/server model and become part of network computing.

In the usual client/server model, one server, sometimes called a daemon, is activated and awaits client requests. Typically, multiple client programs share the services of a common server program. Both client programs and server programs are often part of a larger program or application. Relative to the Internet, your Web browser is a client program that requests services (the sending of Web pages or files) from a Web server (which technically is called a Hypertext Transport Protocol or HTTP server) in another computer somewhere on the Internet. Similarly, your computer with TCP/IP installed allows you to make client requests for files from File Transfer Protocol (FTP) servers in other computers on the Internet.

Other program relationship models included master/slave, with one program being in charge of all other programs, and peer-to-peer, with either of two programs able to initiate a transaction.

Database: A database is a collection of information that is organized so that it can easily be accessed, managed, and updated. In one view, databases can be classified according to types of content: bibliographic, full-text, numeric, and images.

In computing, databases are sometimes classified according to their organizational approach. The most prevalent approach is the relational database, a tabular database in which data is defined so that it can be reorganized and accessed in a number of different ways. A distributed database is one that can be dispersed or replicated among different points in a network. An object-oriented programming database is one that is congruent with the data defined in object classes and subclasses.

Computer databases typically contain aggregations of data records or files, such as sales transactions, product catalogs and inventories, and customer profiles. Typically, a database manager provides users the capabilities of controlling read/write access, specifying report generation, and analyzing usage. Databases and database managers are prevalent in large mainframe systems, but are also present in smaller distributed workstation and mid-range systems such as the AS/400 and on personal computers. SQL (Structured Query Language) is a standard language for making interactive queries from and updating a database such as IBM's DB2, Microsoft's Access, and database products from Oracle, Sybase, and Computer Associates.

Relational Database: A relational database is a collection of data items organized as a set of formally-described tables from which data can be accessed or reassembled in many different ways without having to reorganize the database tables. The relational database was invented by E. F. Codd at IBM in 1970.

The standard user and application program interface to a relational database is the structured query language (SQL). SQL statements are used both for interactive queries for information from a relational database and for gathering data for reports. In addition to being relatively easy to create and access, a relational database has the important advantage of being easy to extend. After the original database creation, a new data category can be added without requiring that all existing applications be modified.

A relational database is a set of tables containing data fitted into predefined categories. Each table (which is sometimes called a relation) contains one or more data categories in columns. Each row contains a unique instance of data for the categories defined by the columns. For example, a typical business order entry database would include a table that described a customer with columns for name, address, phone number, and so forth. Another table would describe an order: product, customer, date, sales price, and so forth. A user of the database could obtain a view of the database that fitted the user's needs. For example, a branch office manager might like a view or report on all customers that had bought products after a certain date. A financial services manager in the same company could, from the same tables, obtain a report on accounts that needed to be paid.

When creating a relational database, you can define the domain of possible values in a data column and further constraints that may apply to that data value. For example, a domain of possible customers could allow up to ten possible customer names but be constrained in one table to allowing only three of these customer names to be specifiable.
The definition of a relational database results in a table of metadata or formal descriptions of the tables, columns, domains, and constraints.

SQL: SQL (Structured Query Language) is a standard interactive and programming language for getting information from and updating a database. Although SQL is both an ANSI and an ISO standard, many database products support SQL with proprietary extensions to the standard language. Queries take the form of a command language that lets you select, insert, update, find out the location of data, and so forth.
R/2 is a set of coordinated business applications from SAP, gained popularity until the mid-1990s, when it was superseded by the more capable R/3 product, later updated by Now more than 20 years old, R/2 continues to be supported by SAP, although support is expected to decline. Using Application Link Enabled (ALE) technology, R/2 systems can share data with R/3 and systems. However, SAP says that it may more cost-effective to migrate to R/3 rather than to stay with R/2, because of the improved support and expanded features available with the current product.

R/3 is the comprehensive set of integrated business applications from SAP, in business application software. R/3 uses the client/server model and provides the ability to store, retrieve, analyze, and process in many ways corporate data for financial analysis, production operation, human resource management, and most other business processes.
A recent release of R/3 makes it possible to get to the R/3 database and applications through Internet access and Web browsers. A sales representative can initiate the workflow for a sales order by filling out an electronic form on a laptop that will be "translated" into input for the R/3 system. Other interfaces such as Lotus Notes can also be used. The Web implementation adheres to the Workflow Client API standard of the Workflow Management Coalition (WfMC). A more recent version of R/3 adds features designed to speed product delivery by helping to manage the supply chain.

SAP applications, built around their latest R/3 system, provide the capability to manage financial, asset, and cost accounting, production operations and materials, personnel, plants, and archived documents. The R/3 system runs on a number of platforms including Windows 2000 and uses the client/server model. The latest version of R/3 includes a comprehensive Internet-enabled package.

ABAP: ABAP (Advance Business Application Programming) is a programming language for developing applications for the SAP R/3 system, a widely-installed business application subsystem. The latest version, ABAP Objects, is object-oriented programming. SAP will run applications written using ABAP/4, the earlier ABAP version, as well as applications using ABAP Objects.

SAP's original business model for R/3 was developed before the idea of an object-oriented model was widespread. The transition to the object-oriented model reflects an increased customer demand for it. ABAP Objects uses a single inheritance model and full support for object features such as encapsulation, polymorphism, and persistence.

SAP R /3 System—The ERP Backbone

The SAP Enterprise Resource Planning (ERP) system, SAP R/3, is built as an integrated system where all functionality necessary to run an enterprise is provided by one system. The main benefits of this approach are the workflow and seamless integration of the different business processes within an enterprise. The integration is what ensures the consistency of the business information.

The functionality within SAP R/3 is split into modules dedicated to the business functions in an enterprise. The core modules include hundreds of business processes to address the needs of an enterprise. They can be categorized under financials, logistics, and human resources management. Each of these, in turn, consists of multiple sub-modules. For instance, logistics includes general logistics, material management, plant maintenance, and production planning, among others. All modules are available on the installation media; customers are free to decide what modules should be implemented.

SAP Financials
Every company must care about and manage money to survive. Therefore, most enterprises start their SAP implementation with SAP Financial Accounting (FI) and SAP Controlling (CO), the fundamental bookkeeping modules. SAP financial modules give enterprises the whole array of accounting functionality with extensive reporting support, especially with the controlling module. An important aspect of the financial accounting system is the real-time generation of the current balance. The needs of globalization are addressed with support for multiple currencies, units, and languages, as well as national tax and legal regulations (R /3 can address US-GAAP, German HGB, IAS, and other accounting standards). The related modules are SAP Enterprise Controlling
(EC) providing an executive management system (EIS),as well as financial consolidation for subsidiaries in countries with different legal regulations, and the SAP Treasury (TR) module.

SAP Logistics
Logistics and production is the most extensive area of SAP R/3 and contains the largest number of modules. The logistic modules manage all processes involved in the internal supply chain, from raw material procurement to final customer delivery and billing. These functions interact with virtually every SAP R/3 module, from financial to human resources (considered work-flow). The main logistic-related modules are Sales & Distribution (SD), Production Planning (PP), and Materials Management (MM). SAP Sales & Distribution (SD) is the second most deployed module. SD covers the complete sales cycle from ordering and quotations over shipping and transportation to billing and customer payment processing. SD supports EDI, fax, mail, and so on. Other useful features include immediate product availability and delivery schedule information by integration with MM and PP. Due to seamless integration with FI and CO (and connections with bank accounts), receivables and revenues are immediately updated. SD generates a much higher load than FI because of the many steps to process a business case and the data exchange necessary with other modules. Depending on the functionality in use, high performance load can quickly arise. Prominent examples of such performance hot spots are online availability check and online price finding. To help keep the response times on the remaining application servers acceptable, it is possible to set up a dedicated server to perform the availability to promise (ATP) calculation within the standard SAP R /3 system.

SAP Material Management (MM) comprises all activities related with material acquisitions (purchasing) and control (inventory, warehousing). The warehouse management (LE-WM) module manages complex warehouse structures, storage areas, and transportation routes. Stock is always controlled because every material movement is immediately recorded. SAP Production Planning (PP) provides a whole palette of production methods ranging from make-to-order production to repetitive manufacturing/mass production for discrete, batch oriented, and continuous production. This business area is a very complex part of SAP R/3, extensively integrated with SD and MM. The capacity requirements planning (CRP) and material requirements planning (MRP) batch processing runs create a significant load on the system (hot spots). Related modules are Plant Maintenance (PM), Quality Management (QM) & the Project System (PS).

SAP Human Resources
The SAP human resources (HR) area includes business processes for personnel administration (applicant screening, payroll accounting, travel expenses, etc.) & personnel development (workforce planning, seminar management, etc.). The business processes associated with the HR modules are very country-specific to adhere to national laws concerning employment, tax, benefits, and so forth. Because these laws are subject to change frequently, many enterprises deploy a dedicated HR system separate from the other systems to restrict the downtime necessary when implementing legal patches to the HR department.

Other Functions
Cross-application modules provide general-purpose functionality independent of specific modules. Applications include, among others, business workflow automation, EDI support, document management system (DMS) with an archive link and product data management (PDM) including CAD integration. However, the most essential functionality is Application Link Enabling (ALE). ALE automates the data exchange between independent systems (R /3, R /2® or external).
This way, ALE provides the ability to synchronize the databases of distributed SAP systems. Reflecting the customer business needs, the scenarios reach from systems distributed around the globe to physical consolidation in one or a few data centers. ALE is the technological basis for the coupling of components discussed later in this chapter. ALE also can be used for replicating a system to another location. ALE has an impact on the CPU and memory utilization, so it must be accounted for on the server(s) that is sending documents. The SAP Computing Center Management System (CCMS) is a built-in management system.
CCMS is delivered with the installation CDs free of charge (no other ERP vendor has a similar solution). As visited earlier, SAP develops enterprise solutions with the vision - to provide standard application software for real-time business processing. To address the latest technology trend, the ERP applications are developed and enhanced from system – SAP R/1, SAP R/2 to current client/server SAP R/3. The product / system functionality are enhanced and upgraded to the newer version regularly. Over & above, a complete product portfolio is offered to address entire gamut of business requirement.

Following are the current SAP ERP solution / product offering with overwhelming response.

SAP R/3 Enterprise

In August 1988, SAP GmbH becomes SAP (System, Application & Products in Data Processing) AG. The client-server concept, uniform appearance of graphical interfaces, consistent use of relational databases, and the ability to run on computers from different vendors meets with overwhelming approval. With SAP R/3, SAP ushers in a new generation of enterprise software - from mainframe computing to the three-tier architecture of database, application, and user interface. SAP R/3 products / solutions are upgraded from the version 3.1I – 3.1H – 4.OB – 4.5B– 4.6B– 4.6C with the latest release SAP R/3 Enterprise Release 4.70 (March 2004).
(Upgrade version wise release notes are available on

Enterprise ERP functionality is a fundamental building block of all e-business solutions. SAP leads the market for enterprise centric solutions, developed from years of industry experience with thousands of customers using SAP R/3. SAP R/3 Enterprise is the successor to the current release: SAP R/3 4.6C. SAP R/3 Enterprise provides enterprise functionality with a new technological foundation that provides SAP R/3 customers with additional benefits whether they are simply following an ERP path or implementing a complete e-business platform in a heterogeneous landscape. SAP R/3 continues to play a central role in the overall strategy of More than 17,000 SAP customers have implemented SAP R/3, which allows them to reliably and efficiently run their business processes.

Benefits of SAP R/3 Enterprise

Based on the customer feedback and requirement for continuously improved functions: a simpler, more flexible upgrade path; and an easy transition to collaborative e-business processes.

* Continuity and New Functionality: As in the past, legal requirements, customer requirements, and new internal business processes are included in new versions of SAP R/3. All functions currently included in SAP R/3 4.6C are available in SAP R/3 Enterprise, and processes supported in SAP R/3 4.6C can be performed in SAP R/3 Enterprise. Furthermore, SAP R/3 Enterprise contains additional enhancements to business process functionality. New developments within SAP R/3 Enterprise are provided in encapsulated objects called SAP R/3 Enterprise Extensions. This technology enables companies to implement new functions step-by-step as required.

* Flexibility and Optimization: SAP R/3 Enterprise allows a more dynamic and flexible upgrade strategy going forward because new functional enhancements can be deployed as needed. This provides an easier upgrade path to and simpler additions to ERP functionality. In addition, SAP has made several improvements to the infrastructure of SAP R/3 enterprise Core, such as Unicode compliance and performance optimization.

* Innovative Technology: SAP R/3 Enterprise is based on SAP Web Application Server (SAP Web AS). SAP Web Application Server provides the underlying runtime infrastructure for all solutions. This enables both seamless integration of systems running SAP R/3 with solutions, as well as use of new concepts for integrating heterogeneous application landscapes and electronic marketplaces.
SAP R/3 Enterprise Architecture

Previous releases of SAP R/3 followed a certain series of steps:

(1) The newest SAP Basis release ( SAP technologies including development environment, ABAP, Data Dictionary, and so on) was deployed.

(2) The prior application release was used as the basis from which to begin development. For example, if we were starting development of SAP R/3 4.5, then the application from the previous release, SAP R/3 4.0, was used as the basis of development.

(3) The development took place in all areas regardless of whether the feature under development was functional in nature, such as new payment program to support credit card handling, or part of the infrastructure, such as performance enhancements in the processing speed of the payment program. All parts of the system could be laid bare for additional development.

The SAP R/3 Enterprise strategy follows a more structured approach from both a technical and functional perspective. From a technical perspective, the newest version of mySAP Technology was taken as the foundation for SAP R/3 Enterprise. Specifically, this is SAP Web AS 6.20. This not only includes all existing SAP Basis technologies with their latest enhancements, but it also includes the other advantages and new features of SAP Web AS. From a functional perspective, the previous application release was taken as the application basis for SAP R/3 Enterprise, in this case SAP R/3 4.6C. This is the same as with previous development, but instead of laying the system bare to all types of development in all areas, developments for SAP R/3 Enterprise are separated into purely functional and infrastructure developments. Infrastructure developments (such as performance or continuous improvement) and legally required changes are made in SAP R/3 Enterprise Core. Functional developments now take place separately in SAP R/3 Enterprise Extensions.

Essentially, the main differences between the SAP R/3 Enterprise strategy and the previous SAP R/3 strategy can be summed up in the following way:

New technologies have become available.
New features can be optionally deployed.
More flexibility will be available in future upgrade strategies.

SAP R/3 Enterprise architecture address major upgrade concern in mainly following three criteria.

SAP R/3 Enterprise Core

The functionality of SAP R/3 Enterprise Core is based on the current SAP R/3 release: SAP R/3 4.6C. Enhancements to the core include optimization and stabilization of existing processes. It has been assigned the release number 4.70. This signifies its similarity to SAP R/3 4.6C and indicates that the core can be independently upgraded and maintained. SAP R/3 Enterprise Core supports the packaging concept, business configuration sets, Unicode compliance, and requirements lay out in section 508 of the United States Rehabilitation Act of 1973.

SAP R/3 Enterprise Extension

SAP R/3 Enterprise Extensions are selectively deployable and have their own release cycles. The name of each SAP R/3 Enterprise Extension reflects its relevant application area. For example, the SAP R/3 Enterprise Financials Extension includes all newly developed functions in the financial accounting and controlling areas. SAP R/3 Enterprise Extensions will be delivered in an SAP R/3 Enterprise Extension Set. The following SAP R/3 Enterprise Extensions are available in the first release of SAP R/3 Enterprise (in the SAP R/3 Enterprise Extension Set 1.10)

SAP R/3 Enterprise Human Resources (HR) Extension
SAP R/3 Enterprise Travel Extension
SAP R/3 Enterprise Product Lifecycle Management (PLM) Extension
SAP R/3 Enterprise Supply Chain Management (SCM) Extension
SAP R/3 Enterprise Financials Extension

When customers upgrade to a higher level of an extension, they must upgrade the extension set. For example, say a customer deploys the SAP R/3 Enterprise Core plus the SAP R/3 Enterprise Extensions 1.10 for human resources, supply chain management, and financials. Later, the customer wants to deploy SAP R/3 PLM Extension 2.00. The customer must upgrade all the extensions to the 2.00 release level. This reduces the number and complexity of extension combinations that will prevent both support and delivery problems due to unfettered multiple versions.

SAP R/3 Enterprise Core and the SAP R/3 Enterprise Extensions are maintained through scheduled support package tracks. There were two support package tracks in previous SAP R/3 releases, but SAP R/3 Enterprise follow separate support package tracks, as indicated below:

SAP R/3 Enterprise Core: Non-HR Core Support Package
SAP R/3 Enterprise Core: HR Core Support Package
SAP R/3 Enterprise Extension: Non-HR Support Package
SAP R/3 Enterprise Extension: HR Support Package

SAP R/3 Enterprise - New Functionality:


The following financial functions have been introduced / updated in SAP R/3 Enterprise:

* Process Improvements
· Accrual Accounting
· Cross Application Time Sheet
· Easy Cost Planning
· Electronic bank statement processing
· Formula Planning
· Internal Service Request
· Payments via Orbian and usage of IBAN
· Stock Option Accounting

* Valuation and Legal Improvements
Actual Cost Component Split
Alternative valuation run
Country version India
Country version South Korea
Depreciation Japan
Handling of inventory differences
Valuation Improvements for WIP and Cost of Good Sold

* Technical Improvements
BAPI’s and BADI’s
Data Medium Exchange Engine
Intracompany Web Services
Periodic Processing
Reporting via XBRL
Tax Reporting via XML

Human Resources:

The following human resources functions have been introduced / updated in SAP R/3 Enterprise:

* Benefits and compensation
* Concurrent employment
* Electronic data interchange (EDI) for official reporting in Germany
* Enabling for hosting or application service provision (ASP)
* GASB 34
* Long-term incentives in compensation management
* Major enhancements in the country version for France
* Management of global employees
* Mobile computing
* New country versions for China, Finland, India, and Korea
* Payroll
* Time management

Product Lifecycle Management:

The following product life-cycle management functions have been introduced / updated in SAP R/3 Enterprise:

* Asset life-cycle management
* Assigned personnel and planned costs in open PS
* Change control in maintenance planning via change documents and exception logs
* Computer-aided design (CAD) desktop
* Cost integration for claims
* Easy Web transactions to create and maintain documents
* E-procurement of maintenance, repair, and operations (MRO) parts
* Expediting and monitoring dates
* Improved search for spare parts and equipment
* Input conversion routine for inspection results
* Life-cycle data management enhancements
* Mobile defects recording
* New Business Application
* Notification framework
* Product replication
* Program and project management
* Programming Interfaces (BAPIs) to load or change orders and confirmations
* Project-oriented material management (Proman)
* Recording consumption for fleet objects
* Retrofit of the mySAP PLM capabilities for environment, health & safety
* Stability studies

Supply Chain Management:

The following supply chain management functions have been introduced / updated in SAP R/3 Enterprise:

* Advanced warehouse interface
* Business application add-ins (BADIs)
* Country version for India
* Cross-system flow of goods
* Document change management for purchase orders
* Event management for manufacturing execution
* Interfaces and extractors
* SAP BW extractors for supply chain analytics
* Task and resource management

For an overview on the new functions of SAP R/3 Enterprise, visit
For detailed information on the new functions and where they are reside (in the extensions or core of SAP R/3 Enterprise), visit
SAP Web Application Server
SAP R/3 Enterprise is built on SAP Web Application Server and integrates seamlessly with the enterprise portal and exchange infrastructure. SAP Web AS is a scalable and reliable component platform that supports the development, implementation, and provisioning of easy-to-use Web applications and Web services. SAP Web AS is the common infrastructure for all components, including SAP R/3 Enterprise. The first release of SAP R/3 Enterprise is delivered on SAP Web AS 6.20.
SAP Web AS provides a homogeneous infrastructure for both Java 2 Enterprise Edition (J2EE) and ABAP-based applications. This brings the benefits of SAP’s proven infrastructure – reliability, scalability, software logistics, change management, platform independence and business knowledge – to the J2EE world. It provides integration services and connectivity to both the portal infrastructure and the exchange infrastructure. SAP Web AS is the natural evolution of SAP Basis and incorporates its functions. SAP Web AS 6.20 incorporates all the features of existing SAP Basis and Web application servers, such as the development workbench, transport management system, monitoring, versioning, and the business object repository.Additional enhancement relevant for SAP R/3 Enterprise in the areas of technology and infrastructure:

Package Concept - The package concept of SAP Web AS allows the decoupling of application functionality. SAP R/3 Enterprise uses the package concept for the SAP R/3 Enterprise Extensions, which are decoupled from SAP R/3 Enterprise Core. Customers and partners can use the package concept for new developments for flexible deployment and easier maintenance. All kinds of application functionality can be included within a package. The package concept ensures that all communication with the package is done exclusively through well-defined interfaces without modifying SAP R/3 Enterprise Core. This prevents dependencies on the inner workings of a package, and it eases maintenance. The package concept also allows separate transportability of objects, which helps to integrate and maintain partner software easily.

Global Parameterization with Business Configuration Sets - Business configuration sets are sets of configuration settings of an application component that allow easy parameterization of SAP R/3 Enterprise and other components. With this technology, customizing configuration is grouped according to logical business management criteria. Business configuration sets can be transported to other systems to support a global rollout or scenario build-up in test systems, for example. They can also be used for documentation, quality assurance, and reuse purposes. Business configuration sets become available for the first time with SAP R/3 Enterprise.

Unicode - SAP is committed to incorporating new technologies, such as Java, Extensible Markup Language (XML), Lightweight Directory Access Protocol (LDAP), and Wireless Markup Language (WML), into to offer the most advanced business applications available. All of these technologies use Unicode. Unicode uniquely defines every character – no matter what the platform, program, or language. This is especially important for communication between systems that use multiple languages. SAP R/3 Enterprise offers Unicode compliance. ABAP source code in SAP Web Application Server fully complies with Unicode standards, and the same ABAP source code runs on both Unicode and non-Unicode systems. Unicode-compliant programs can therefore be used in both Unicode and non-Unicode components. Customers can select either a pure Unicode installation or combine Unicode and non-Unicode components according to their specific needs.

Accessibility - SAP Web AS addresses the requirements of Section 508, an amendment to the United States Rehabilitation Act of 1973.Section 508, which went into effect in June 2001, mandates that all information technology that is procured by U.S. government agencies must be accessible to people with disabilities. In addition, any information technology, such as Web applications, that the U.S. government makes available to citizens must also be accessible to people with disabilities.
SAP R/3 ERP Availability

SAP R/3 Enterprise is available to customers since the second half of 2002. Above figure 10 shows the availability of SAP R/3 Enterprise and the maintenance schedules of other SAP R/3 releases. All SAP R/3 releases prior to SAP R/3 4.6C that are currently covered by maintenance are expire in August 2003. SAP R/3 4.6C will have continuous maintenance coverage until 2006. SAP R/2 will expire entirely at the end of 2004.

SAP has been traditionally involved in helping customers modernize their back-office operations by integrating business processes, with standard Enterprise Resource Planning (ERP) software SAP R/3. The traditional SAP R/3 ERP system offers transaction and reporting functionality in the areas of financial, logistics and human resource applications, enabling the exchange of data between a company’s various business units or divisions. The standard business process fits all approach of SAP R/3 often required business process reengineering to meet the business needs. Because this could only address a limited portion of the market’s needs, SAP began offering industry-specific solutions and extended ERP solutions, including managing supplier relationships with supply chain management (SCM) solutions, managing the distributors, resellers and customers with customer relationship management (CRM) solutions, and managing the knowledge-assets with business intelligence (BI) solutions. In the traditional ERP world, companies first focused on getting their own in-house business processes under control and integrated. In any case, these ERP systems were not as open to the outside world. The evolving customer-centric internet business world, with its HTTP and XML communication protocols and need to do business anywhere and at any time, has enabled business collaboration to take place. Instead of communicating with know and established business partner now an entire electronic community (manufacturers, distributors and customers) can perform business transactions among each other in electronic marketplace portals. The latest global business trend of Collaboration, Integration & Empowerment is addressed by introduction of , which is:

“A family of software and services that empowers customers, partners, and employees to collaborate successfully - anywhere, anytime.” delivers these benefits through four key components: Marketplaces: The Marketplace is SAP’s portal for e-communities. It is a personalized internet desktop and middleware layer. The business applications are the core business processing component, which allows organizations to create, test, implement and host solutions online. Marketplace is Internet hubs that enable bilateral and multilateral collaboration between and among enterprises. Marketplaces provide services ranging from stock quotes and news to discussion forums, business directories, and hosted applications - for example, e-commerce, collaborative forecasting and collaborative engineering etc. Marketplaces may be purchased by organizations that want to build and operate marketplaces either on their own or in a joint venture with SAP and/or other companies. SAP also offers Marketplaces as a service that can be used by participating organizations for a fee. Examples of such marketplaces are at, which went live in October 1999, and the marketplaces for Chemicals/ Pharmaceuticals and for Oil & Gas, which open their doors this year. Marketplaces: The Workplace provides and intranet portal that supplies users with role-based, personalized web access to all systems, functions and services that they require to accomplish their tasks. Users perform roles t participate in particular business scenarios (For example create invoice) that are provided by numerous components and external systems. The workplace provides the user with an integrated, personalized working environment that offers access to all the functions and information required accomplishing the tasks related to his or her specific role. The role determines the visual appearance of a user’s workplace. It is used to structure the Launch Pad and the display of the Mini-Apps. A user’s role determines the transactions, information and services that he or she may access via the workplace. To implement the workplace, the desktop PCs need a compatible HTTP browser, and then at least one server is needed, as well as the Workplace Middleware. Business Scenarios: Business Scenarios combines intra- and inter-enterprise services, information, and application components. These form collaborative business scenarios in the areas of e-Commerce, Customer Relationship Management, Supply Chain Management, Business Intelligence, and Enterprise Resource Management.

The entire gamut of solutions is grouped in three main categories:
Cross-Industry Solutions
Industry Solutions
Infrastructure and Services Solutions
The functionality of each of these solutions is delivered through their underlying technical components, such as SAP R/3, SAP BW, and SAP APO. These technical components bear the prefix SAP to distinguish them from the solutions. Application Hosting: Application Hosting reduces the risk, time, and investment needed to participate in collaborative business processes. An application service provider ensures that a whole software solution, or parts of it, is provided to a company as a service over the Internet; the enterprise does not need to run the software itself and consequently saves investments in hardware, maintenance, and system management.

SAP Solutions

To address unique business needs, currently following are the business solutions offered by SAP.
(For detailed solution, refer


mySAP ERP Financials
mySAP ERP Human Capital
mySAP ERP Operations
mySAP ERP Corporate Services

mySAP Business Suite.
mySAP Customer Relationship Management
mySAP Product Lifecycle Management
mySAP ERP Supplier Relationship Management
mySAP Supply Chain Management
SAP xApps.
SAP xApp Cost and Quotation Management (SAP xCQM)
SAP xApp Emissions Management (SAP xEM)
SAP xApp Integrated Exploration and Production (SAP xIEP)
SAP xApp Product Definition (SAP xPD)
SAP xApp Resource and Portfolio Management (SAP xRPM)
SAP Global Trade Services (SAP GTS)
SAP Manufacturing.
SAP NetWeaver.
· Web Application Server
· Enterprise Portal
· Business Information Warehouse
· Exchange Infrastructure
· Knowledge Management
· Mobile Infrastructure
· Master Data Management
· Composite Application Framework
· Life Cycle Management
Solutions for Small & Midsize Business.
SAP Business One
mySAP All-in-One
Solution for Mobile Business.
Analytic Application.

1 comment:

Jenice said...

Useful post. I am extremely happy that I found this article which provides an excellent overview of SAP. I have been searching around for this information so that I can understand about this software application. Thanks for this awesome share.
sap testing