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ERP History in DepthThe evolution of the systems dates back to the year 1960 as per ERP history. The systems in
the yesteryears were designed to assist the manufacturing process. The first software that
was developed in this process happens to be MRP (material Resource Planning) in the year
1975.This was followed by another advanced version namely MRP2 which is the acronym forManufacturing Resource planning. None of them yielded the benefit of ERP.
Drawback of MRP Systems
These software were helpful in manufacturing process. Their benefits did not extend to
other Sectors. ERP was developed as multifaceted software that gradually stretched its
limits into other areas like human resource, finance, marketing and so on. Moreover ERP
offered operational convenience and large reduction in costs coupled with other
benefits when compared with earlier soft wares.
MRP solutions attained more fame. In fact it became a hallmark of the manufacturing
setups. The MRP solutions did not render the expected results due to exorbitant
costs and practical work problems.Inaddition it also called for a huge pool of
technical expertise in terms of manpower and machines.
Advent of ERP
ERP came into being with effect from 1990 though the fact remained that many people are
of the opinion that ERP existed from the year 1960 in the form of MRP1 and MRP 2. IN Fact
MRP II was more or less an ERP except for its inability to coordinate departments other than
marketing. The whole period from the year 1960 is denoted as the age of ERP.The benefit of
ERP was slowly felt from this stage onwards.
Companies
Sap ERP history contains detailed study of SAP's association with ERP.Global ERP leader SAP
technologies were established in the year 1972 by five engineers. This was followed by
invention of larson software which was a built in model. It was meant to replace the market
practice of designing soft wares as per individual business needs. Some more companies
namelyOracle and Baan Corporation were included in the fray in 1970 and 1980's.This was
followed by the invention of People soft and their software on Human Resource Management
in the years 1987 and 1988 respectively. Baan Corporation specialized in rendering financial
and management consultation services. Oracle was the first ever company ever to offer
commercial and relational database management systems.
Operating Systems
The operating systems that were in vogue during the period are important in understanding
the history of ERP. JD Edwards Co Founder of moniker (in the year 1977) made use of IBM
Systems/38.Baan Corporation utilized UNIX.
Market Information on Companies
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Sap holds the privilege of being the world's largest enterprise company. JD Edwards and
Oracle enjoy a whooping customer base of 4700(in 100 countries) and 41000 customers
around the globe. People soft controls more than a half of the human resource market and
has offices in many nations.
Web friendlyWhile ERP is a technological innovation in itself its efficiency is multiplied by several times
with the help of latest inventions. Nowadays ERP is tuned to make use of the internet. This is
to make sure that the buyers anywhere can have access to the database of the seller by a
mouse click and that too by sitting anywhere in the world. This has become the mantra in
the 21st century. The latest ERP tool which is becoming the order of the day is ERPII which is
discussed in detail as separate links in the website. SAP Erp History and ERP history are vital
in understanding the origin of the subject matter.
Advantages and Disadvantages of ERP
The advantages and disadvantages of ERP is an interesting Study. The foremost advantage
of an ERP system is bringing down the costs and saving the valuable time which would have
otherwise been wasted in procedural maneuvers and unwanted delays. Different software
programs maintained in the departments were proving to be a great hurdle. Since ERP is a
uniform platform it ensures that there in no discrepancy in the information that is
processed.
Industry wise advantages
Manufacturing Sector--------------------Speeding up the whole process.
Distribution and retail Stores-----------Accessing the status of the goods
Transport Sector---------------------------Transmit commodities through online transactions.
Project Service industry-----------------Fastens the compilation of reports.
The advantage and disadvantage of ERP is best understood by studying them under
different categories. Hence the next paragraph presents information on corporates as a
whole because the advantage of ERP systems in a company is different when compared
industry wise.
Advantages in a corporate entity
The accounts department personnel can act independently. They don't have to be behind
the technical persons every time to record the financial transactions.
Ensures quicker processing of information and reduces the burden of paperwork.
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Serving the customers efficiently by way of prompt response and follow up.
Disposing queries immediately and facilitating the payments from customers with
ease and well ahead of the stipulated deadline.
It helps in having a say over your competitor and adapting to the whims andfancies of the market and businessfluctuations. The swift movement of goods to rural
areas and in lesser known places has now become a reality with the use of ERP.
The database not only becomes user friendly but also helps to do away with unwanted
ambiguity.
ERP is suitable for global operations as it encompasses all the domestic jargons, currency
conversions, diverse accounting standards, and multilingual facilities .In short it is the
perfect commercial and scientific epitome of the verse "Think Local. Act Global".
ERP helps to control and data and facilitates the necessary contacts to acquire the same.
Disadvantage
Inspite of rendering marvelous services ERP is not free from its own limitations. ERP calls for
a voluminous and exorbitant investment of time and money. The amount of cash required
would even be looming on the management given the fact that such an outlay is not a
guarantee to the said benefits but subject to proper implementation, training and use. In the
ever expanding era of information theft ERP is no exception. It is alarming to note the time
taken to implement the system in the organization. These means large amounts of workers
have to shun their regular labor and undertake training. This not only disturbs the regular
functioning of the organization but also runs the organization in the huge risk of losing
potential business in that particular period. There are great benefits rendered by thesystem. On the other hand when one thinks of this information reach in the hands of
undeserving persons who could do more than misuse ,it is evident that there is no way of
ensuring secrecy of information and larger chances of risk will be generated as long as they
are in the public domain.
Conclusion
ERP is recommended in an organization not only because the advantages outnumber the
disadvantages but also by keeping in mind the ways to overcome the disadvantages. An
organization has to correctly weigh the advantages and disadvantages of ERP before going
for them.
What is ASAP Methodology
ASAP: Accelerated Systems Application and Products in Data Processing
All implementation projects have the the following phases:
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Scoping - What is to be implemented i.e. which submodules are to be implementedsome clients may not require credit management for example. Look at the projectscope document carefully it will tell you what SAP sub-modules in SAP you should be
prepared for. Usually the sales people along with project manager do it.
As is - Here you understand the existing business processes of the client . YourBPOcollect all the ISO-documentation (if client is ISO certified), reports and forms at
this stage and you analyse how and when the reports/forms are generated, where thedata is coming from. You also do a Level -2 training for your BPO so he is made
aware of all the required transactions in SAP.
Once this is over BPO can start learning with the consultants help more about SAP.
This is crucial because if you miss out any transactions the BPO may forget aboutsome of his Business processes which may come up later. It is a good practice to ask
the BPO to make flow charts to explain business processes.
To-Be - Parallely you map these processes to SAP.Processes that you are not surerocesses that you are not sure of as to whether they are present in SAP or not you try to do a configuration of thosef as to whether they are present in SAP or not you try to do a configuration of those processes, and along with therocesses, and along with theBPOPO (Business process owner he is the clientsemployee who knows about the clients business processes probably a middle
management guy, ther can more than one), BPO involvement is required as he may beable to tell you his requirements better. Once you do the business modeling you
will also be made aware of the gaps between as-is and to-be , here decisons have tohere decisons have to be made as to wether a ABAP development/system modification is required or not andbe made as to wether a ABAP development/system modification is required or not and
so on.so on. Involve the BPO as much as possible and document everything it is goodpractice do not be lazy about it.
Business blueprint:Here the as-is and to-be and gap analysis is explained.. ThisThisis the document that you will be using to do your configuration in the realizationis the document that you will be using to do your configuration in the realization phase.phase.
Realization phase:Here you do the configuration in the development server(there are three clients -development,quality, production). You alsodecide on the master data format, so that BPO can go collect the master data. Youalso gove ABAP specifications for forms, reports etc, system modifications etc. Unit
testing: Your BPOs and a few key users sit down and test your configuration in yourmodule only. It is good to test the BDCs that you need for uploading data at this stage
so you have more realistic data and your BDCs are tested.
Integration testing:Once all modules unit testing is over then the configuration is trasported to theQuality server, where testing for all the modules is done by BPOs and end user, this
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is to check if any problems are there in integration between various modules. Onceall is okay from the QA server config is transported to the production server.
Go live preparationData uploading: The collected master data is checked and the uploaded into
production server(sever and client I have used interchangeably). Now you are readyfor go live i.e. users can now use the production server.
ASAP methodoligy means nothing but standard process for implementation of
SAP, It consists of5 phases.
1. Project preperation - consists of identifying team members and developing strategyas how to go.
2. Business Blue print - consists of identifying the client current process, reqeirement
and how SAP provides solution.
Consists of detailed documentaion
3. Realization -The purpose of this phase is to implement all the business and process
requirements based on theBusiness Blueprint.
4. Final Preparation - The purpose of this phase is to complete testing, end-user
training,
5. Go Live and Support
All the functinal consultatns need good rapo with Abapers. right from uploading of
legacy data, devoloping customised reports, BDC's, Forms etc, here functinalconsultatns need to give guidence as to get the requried data for reports and all.. like
the table name, fields etc
What is baseline configuration in sap?
Base line and Final config is the third phase in ASAP methadology. The purpose of
this phase is to implement all the business & process requirements based on businessblue print. You customize the system step by step in 2 work packages: Base Line
Configuration & Final Configuration.
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- Base Line Configuration: this phase comprises the priority requirements of theenterprise, ensuring that they can be implemented quickly. This phase can be
completed without programming or enhancements to SAP systems.
- Final Configuration: in this phase you confirm that all your requirements are met inthe R/3 system. Final configuration is a transportation process that expands that base
line solution.
What is AS-IS study & TO-BE Process? who will be prepared the this
process.
As-Is study means studying the business process of the client. The SAP consultantgoes to the client's place and gets this document. Once the As is document is readythe
consultant based on the client's requirement prepares the To-Be document which meanshow the business of the client must be. This whole process takes place in the Second phaseof ASAP which is the Blueprint Phase.
While doing biz blue printing, SAP Consultant goes to the client and understands theirbusiness model, how are they working and what they have been doing, how are they
working, is calledAS - IS.
TO BE is a plan SAP consultant will present them which will enable them to improve theirservice, operations and controlling while keeping the costs to their minimum. (PostImplementation)
AS IS study is the one of the most Important & begins of the SAP Implementationproject. The Consultant has to go to the client place and has to
gather all the details provided by the client. There after only consultant can prepare
Business Blue Print which will come under second head of the ASAP ie To BEprocess.
AS IS study help the project in such a way that ex - how many modules that are used fromSAP, how many teams required for project, schedule date for go live & project etc.so its utmost important
this is very very imp foundation stage the consultant is mapping the following theasethings
u have to ask the following questions to clientWhat, how, when, where the process is going to happens1) Planning-RM Planning
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-production planning-special Business process planning (eg-rewark, salveging etc)2) Executionall as above
What Is an SAP Workflow?
SAP is an Enterprise Resource Management (ERP) software system. ERP systems are softwareand hardware systems that help businessesmanage and control manufacturing and production
processes. They often integrate supply chains, to help ensure timely delivery of parts both within
a company and from outside vendors. A key component to the smooth functioning of the systemis business workflows that define business processes, the steps of those processes and what
needs to happen with each step. The terms "SAP" and "SAP system" can refer to the software
provided by SAP Global and also refer to the integrated system of software, hardware and
business processes used in a company.
Existing Processes
1. A mature SAP system is built around existing processes and workflows. For example,a company manufacturing extruded plastic would have a workflow for their as-isbusiness processes. As-is processes are business processes as they were when theinitial SAP system was implemented, before any business process engineering isapplied. These as-is business processes and workflows were what defined the way inwhich the SAP software was installed and configured.
The SAP Business Workflow System
2. Many large businesses are run using business processes. A business process is adocumented way of completing a task or a series of tasks. At times, either anexisting business process will need changes or a new process may need to bedeveloped. For a company using SAP to manage their businesses, these processesneed to be integrated into an existing SAP installation. Integration includesdocumenting the process and analyzing how it will work with other existing businessprocesses.
SAP's Business Workflow System is a way to begin building these new workflows andlooking at how they affect other documented business process. SAP BusinessWorkflow integrates closely with other SAP software, making it easier to see how thenew or revised processes might affect other areas of the business.
Workflows in Management
3. Workflows define and clarify the processes and tasks the must be completed for aparticular business process. For example, a workflow for a purchasing decision mightroute paperwork through the proper internal approval process before sending it to asupplier. This could result in fewer problems with unauthorized purchases.
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Manufacturing Workflows
4. A manufacturing workflow documents and defines all of the steps in manufacturingor making products. For example, an aerospace workflow might start with the inputof a raw material, like sheet aluminum. The workflow would then help a machinistthough the process of cutting the metal into defined shapes for use in different parts
of the airplane. SAP systems help implement manufacturing workflows for a numberof industries.
Features of SAP Workflows
5. SAP workflows can be built as an object oriented system. For example, if there is aworkflow in a bicycle manufacturer for making a frame, a separate workflow formaking the front wheel, and a separate workflow for making the rear wheel, thesethree workflows can be integrated into an overall work flow for making a bicycle.
Read more: What Is an SAP Workflow? | eHow.com
http://www.ehow.com/about_6467719_sap-workflow_.html#ixzz1ANdiVtn2
Enterprise resource planning(ERP) integrates internal and externalmanagement information
across an entire organization, embracingfinance/accounting, manufacturing, sales and service,etc. ERP systems automate this activity with an integrated computer-based application. Its
purpose is to facilitate the flow of information between all business functions inside the
boundaries of the organization and manage the connections to outside stakeholders. [1]
ERP systems can run on a variety of hardware and network configurations, typically employinga database to store its data.[2]
ERP systems typically include the following characteristics:
An integrated system that operates in (next to) real time, without relying on periodic
updates.[citation needed]
A common database, that supports all applications.
A consistent look and feel throughout each module.
Installation of the system without elaborate application/data integration by theInformation Technology (IT) department.[3]
History
Origin of "ERP"
In 1990 Gartner Group first employed the acronym ERP[4] as an extension of (material
requirements planning(MRP), latermanufacturing resource planning[5] [6] ) andcomputer-
integrated manufacturing. Without supplanting these terms, ERP came to represent a largerwhole, reflecting the evolution of application integration beyond manufacturing.[7] Not all ERP
packages were developed from a manufacturing core. Vendors variously began with accounting,
http://www.ehow.com/about_6467719_sap-workflow_.html#ixzz1ANdiVtn2http://www.ehow.com/about_6467719_sap-workflow_.html#ixzz1ANdiVtn2http://en.wikipedia.org/wiki/Management_informationhttp://en.wikipedia.org/wiki/Financehttp://en.wikipedia.org/wiki/Accountinghttp://en.wikipedia.org/wiki/Accountinghttp://en.wikipedia.org/wiki/Manufacturinghttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-0http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-1http://en.wikipedia.org/wiki/Wikipedia:Citation_neededhttp://en.wikipedia.org/wiki/Wikipedia:Citation_neededhttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-2http://en.wikipedia.org/wiki/Gartner_Grouphttp://en.wikipedia.org/wiki/Acronym_and_initialismhttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-3http://en.wikipedia.org/wiki/Material_requirements_planninghttp://en.wikipedia.org/wiki/Material_requirements_planninghttp://en.wikipedia.org/wiki/Manufacturing_resource_planninghttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-4http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-4http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-5http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-5http://en.wikipedia.org/wiki/Computer-integrated_manufacturinghttp://en.wikipedia.org/wiki/Computer-integrated_manufacturinghttp://en.wikipedia.org/wiki/Computer-integrated_manufacturinghttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-6http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-6http://www.ehow.com/about_6467719_sap-workflow_.html#ixzz1ANdiVtn2http://www.ehow.com/about_6467719_sap-workflow_.html#ixzz1ANdiVtn2http://en.wikipedia.org/wiki/Management_informationhttp://en.wikipedia.org/wiki/Financehttp://en.wikipedia.org/wiki/Accountinghttp://en.wikipedia.org/wiki/Manufacturinghttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-0http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-1http://en.wikipedia.org/wiki/Wikipedia:Citation_neededhttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-2http://en.wikipedia.org/wiki/Gartner_Grouphttp://en.wikipedia.org/wiki/Acronym_and_initialismhttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-3http://en.wikipedia.org/wiki/Material_requirements_planninghttp://en.wikipedia.org/wiki/Material_requirements_planninghttp://en.wikipedia.org/wiki/Manufacturing_resource_planninghttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-4http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-5http://en.wikipedia.org/wiki/Computer-integrated_manufacturinghttp://en.wikipedia.org/wiki/Computer-integrated_manufacturinghttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-68/7/2019 concept of sap
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maintenance and human resources. By the mid-1990s ERP systems addressed all core functionsof an enterprise. Beyond corporations, governments and non-profit organizations also began to
employ ERP systems.[8]
Enterprise resource planning(ERP) integrates internal and externalmanagement informationacross an entire organization, embracingfinance/accounting, manufacturing, sales and service,
etc. ERP systems automate this activity with an integrated computer-based application. Its
purpose is to facilitate the flow of information between all business functions inside theboundaries of the organization and manage the connections to outside stakeholders. [1]
ERP systems can run on a variety of hardware and network configurations, typically employing
a database to store its data.[2]
ERP systems typically include the following characteristics:
An integrated system that operates in (next to) real time, without relying on periodicupdates.[citation needed]
A common database, that supports all applications.
A consistent look and feel throughout each module.
Installation of the system without elaborate application/data integration by theInformation Technology (IT) department.[3]
History
Origin of "ERP"In 1990 Gartner Group first employed the acronym ERP[4] as an extension of (material
requirements planning(MRP), latermanufacturing resource planning[5] [6] ) andcomputer-
integrated manufacturing. Without supplanting these terms, ERP came to represent a largerwhole, reflecting the evolution of application integration beyond manufacturing.[7] Not all ERP
packages were developed from a manufacturing core. Vendors variously began with accounting,
maintenance and human resources. By the mid-1990s ERP systems addressed all core functionsof an enterprise. Beyond corporations, governments and non-profit organizations also began to
employ ERP systems.[8]
Materials requirements planning
MRP was the precursor to ERP. Large companies found great value in creating a common
foundation for automating information management for their manufacturing processes. Success
with MRP projects led companies and vendors to consider expanding to other functional areas.[citation needed]
http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-7http://en.wikipedia.org/wiki/Management_informationhttp://en.wikipedia.org/wiki/Financehttp://en.wikipedia.org/wiki/Accountinghttp://en.wikipedia.org/wiki/Accountinghttp://en.wikipedia.org/wiki/Manufacturinghttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-0http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-1http://en.wikipedia.org/wiki/Wikipedia:Citation_neededhttp://en.wikipedia.org/wiki/Wikipedia:Citation_neededhttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-2http://en.wikipedia.org/wiki/Gartner_Grouphttp://en.wikipedia.org/wiki/Acronym_and_initialismhttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-3http://en.wikipedia.org/wiki/Material_requirements_planninghttp://en.wikipedia.org/wiki/Material_requirements_planninghttp://en.wikipedia.org/wiki/Manufacturing_resource_planninghttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-4http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-4http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-5http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-5http://en.wikipedia.org/wiki/Computer-integrated_manufacturinghttp://en.wikipedia.org/wiki/Computer-integrated_manufacturinghttp://en.wikipedia.org/wiki/Computer-integrated_manufacturinghttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-6http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-6http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-7http://en.wikipedia.org/wiki/Wikipedia:Citation_neededhttp://en.wikipedia.org/wiki/Wikipedia:Citation_neededhttp://en.wikipedia.org/wiki/Enterprise_resource_planninghttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-7http://en.wikipedia.org/wiki/Management_informationhttp://en.wikipedia.org/wiki/Financehttp://en.wikipedia.org/wiki/Accountinghttp://en.wikipedia.org/wiki/Manufacturinghttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-0http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-1http://en.wikipedia.org/wiki/Wikipedia:Citation_neededhttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-2http://en.wikipedia.org/wiki/Gartner_Grouphttp://en.wikipedia.org/wiki/Acronym_and_initialismhttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-3http://en.wikipedia.org/wiki/Material_requirements_planninghttp://en.wikipedia.org/wiki/Material_requirements_planninghttp://en.wikipedia.org/wiki/Manufacturing_resource_planninghttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-4http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-5http://en.wikipedia.org/wiki/Computer-integrated_manufacturinghttp://en.wikipedia.org/wiki/Computer-integrated_manufacturinghttp://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-6http://en.wikipedia.org/wiki/Enterprise_resource_planning#cite_note-7http://en.wikipedia.org/wiki/Wikipedia:Citation_needed8/7/2019 concept of sap
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Expansion
ERP systems experienced rapid growth in the 1990s because theyear 2000 and theEuro
disrupted legacy systems. Many companies took this opportunity to replace such systems withERP. This rapid growth in sales was followed by a slump in 1999 after these issues had been
addressed.
[9]
ERP systems initially focused on automatingback office functions, indicating thatcustomersand
the general public were not directly involved.Front officefunctions such as customerrelationship management (CRM) dealt directly with customers, ore-businesssystems such as e-
commerce, e-government, e-telecom, and e-finance, orsupplier relationship management(SRM)
became integrated later, when the Internet simplified communicating with external parties.[citation
needed]
"ERP II" was coined in the early 2000s. It describes web-based software that allows both
employees and partners (such as suppliers and customers) real-time access to the systems.
"Enterprise application suite" is an alternate name such systems.
[citation needed]
Components
Transactional database
Management portal/dashboard
Business intelligence system
Customizable reporting
External access via technology such as web services
Search
Document management
Messaging/chat/wiki
Workflow management
Best practices
Best practices are incorporated into most ERP systems. This means that the software reflects thevendor's interpretation of the most effective way to perform each business process. Systems vary
in the convenience with which the customer can modify these practices.[10]Companies that
implemented industry best practices decreased mission-critical project tasks such as
configuration, documentation, testing and training. In addition, best practices reduced risk by
71% when compared to other software implementations.[11]
The use of best practices eases compliance with requirements such asIFRS,Sarbanes-Oxley, or
Basel II. They can also help industry standard functions such aselectronic funds transfer. This is
because the procedure can be readily codified within the ERP software, and then replicated withconfidence across multiple businesses who share that business requirement.[citation needed]
Modularity
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Most systems are modular simply for the flexibility of implementing some functions but notothers. Some common modules, such as finance and accounting are adopted by nearly all
companies implementing enterprise systems; others however such as human resource
management are not needed by some companies and therefore not adopted. A service company
for example will not likely need a module for manufacturing. Other times companies will not
adopt a module because they already have a system they believe to be superior. Generallyspeaking, the greater the number of modules selected, the greater the integration benefits, but
also the increase in costs, risks and changes involved. [citation needed]
Connectivity to plant floor information
ERP systems connect to real-time data and transaction data in a variety of ways. These systems
are typically configured bysystems integrators, who are able to bring in their unique knowledge
on process, equipment, and vendor solutions.
Direct integrationERP systems connectivity (communications to plant floor equipment) as
part of their product offering. This requires the ERP system developers to offer specific supportfor the variety of plant floor equipment that they want to interface with. ERP Vendors must be
expert in their own products, and connectivity to other vendor products, often those offered bycompetitors.
Database integrationERP systems connect to plant floor data sources through a staging table
in a database. Plant floor systems deposit the necessary information into the database. The ERP
system takes the information from the table. The benefit of staging is that ERP vendors do notneed to master the complexities of equipment integration. Connectivity becomes the
responsibility of thesystems integrator.
Enterprise appliance transaction modules (EATM)These devices communicate directly withplant floor equipment and with the ERP system via methods supported by the ERP system.EATM can employ a staging table, Web Services, or systemspecific program interfaces (APIs).
The benefit of an EATM is that it offers an offtheshelf solution.
Customintegration solutionsMany system integrators offer custom solutions. These systems
tend to have the highest level of initial integration cost, and can have a higher long term cost interms on maintenance and reliability. Long term costs can be minimized through careful system
testing and thorough documentation. Custom-integrated solutions typically run on workstation
or server class computers.
Standard protocolsCommunications drivers are available for plant floor equipment andseparate products have the ability to log data to relational database tables. Standards exist
within the industry to support interoperability between software products, the most widely
known being OPC, managed by the OPC Foundation.
Implementation
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ERP's scope usually implies significant changes to staff work practices.[12] Generally, three typesof services are availableconsulting, customization, and support.[12] Implementation time
depends on the size of the business, the number of modules, the extent of customization, the
scope of the changes to business processes, and the willingness of the customer to take
ownership for the project. ERP systems are modular, so they can be implemented in stages. The
typical project consumes about 14 months and requires around 150 consultants .[13]
Small p canrequire months; multinational and other large implementations can take years.[citation needed]
Extensive customization can substantially increase implementation times.[13]
Implementing ERP software can overwhelm technicians who lack explicit experience with it. Asa result, hiring professionally trained consultants to implement these systems is common.[citation
needed] Consulting firms typically provide three areas of professional services: consulting,
customization, and support. The client organization can also employ independentprogrammanagement,business analysis,change management, andUATspecialists to ensure their
business requirements remain a priority during implementation.[citation needed]
Process preparation
Implementing ERP can require changing existing business processes to the "best practice"
approach that the software embodies.[14]Neglecting to understand the needed process changesprior to starting implementation is a main reason for project failure.[15] It is therefore crucial
that organizations thoroughly analyze business processes before selecting a vendor. This
analysis can identify opportunities for process modernization. It also enables an assessment of
the alignment of current processes with those provided by the ERP system. Research indicatesthat the risk of business process mismatch is decreased by:
linking current processes to the organization's strategy;
analyzing the effectiveness of each process;
understanding exising automated solutions.[16][17]
ERP implementation is considerably more difficult (and politically charged) in decentralized
organizations, because they often have different processes, business rules, data semantics,
authorization hierarchies and decision centers.[18]This may require that some business unitsremain outside the ERP system, delaying implementation to work through the necessary changes
for each unit, reducing integration (e.g. linking viaMaster data management) or customization
to meet each unit's needs.[citation needed]
A potential disadvantage is that adopting "standard" processes can lead to a loss of competitiveadvantage. While this has happened, losses in one area area often offset by gains in other areas,
increasing overall competitive advantage.[19][20]
Configuration
Configuring an ERP system is largely a matter of balancing the way you want the system to
work with the way the system lets you work. ERP systems typically build many changeableparameters that modify the operation of the system. For example, an organization can select the
type of inventory accountingFIFO or LIFOto employ, whether to recognize revenue by
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geographical unit, product line, or distribution channel and whether to pay for shipping costswhen a customer returns a purchase.[citation needed]
Customization
When the system doesn't offer a particular feature, the customer can re-write part of the code, orinterface to an existing system. Both options add time and cost to the implementation process
and can dilute system benefits. Customization inhibits seamless communication between
suppliers and customers who use the same ERP system uncustomized.[citation needed]
Key differences between customization and configuration include:
Customization is always optional, whereas the software must always be configuredbefore use (e.g., setting up cost/profit center structures, organisational trees,purchase approval rules, etc.)
The software was designed to handle various configurations, and behavespredictably
The effect of configuration changes on system behavior and performance ispredictable and is the responsibility of the ERP vendor. The effect of customization isthe customer's responsibility and increases testing activities.
Configuration changes survive upgrades to new software versions. Somecustomizations (e.g. code that uses pre-defined "hooks" that are called before/afterdisplaying data screens) survive upgrades, though they will still need to be retested.Others (e.g. those involving changes to fundamental data structures) are overwrittenduring upgrades and must be reimplemented.
Customization can be expensive and complicated, and can delay implementation. Nevertheless,
customization offers the potential to obtain competitive advantage vis a vis companies using only
standard features.
Extensions
ERP systems can be extended with third-party software. ERP vendors typically provide access to
data and functionality through published interfaces. Extensions offer features such as: [citation needed]
archiving, reporting and republishing;
capturing transactional data, e.g. using scanners, tills orRFID
access to specialized data/capabilities, such as syndicated marketing data andassociated trend analytics.
Data migration
Data migration is critical to implementation success and requires significant planning.
Unfortunately, since migration is one of the final activities before the production phase, it often
receives insufficient attention. The following steps can structure migration planning:[21]
1. Identify the data to be migrated2. Determine the timing of data migration3. Generate the data templates
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4. Freeze the tools for data migration5. Decide on migration-related setups6. Decide on data archiving
Consultants
Many organizations do not have sufficient internal skills to implement ERP. Typically, anoutside consulting team is responsible for the ERP implementation including:[citation needed]
1. selecting2. planning3. training4. configuring/customizing5. testing6. implementation7. delivery
Examples of other services include writing process triggers and custom workflows; specialist
advice to improve how the ERP is used in the business; system optimization; custom reports;complex data extracts or implementingBusiness Intelligence.[citation needed]
For mid-sized companies, the cost of the implementation typically ranges from 1-2x thesoftware's list price. Large companies, and especially those with multiple sites or countries, may
spend 3-5x.[citation needed]
Unlike most single-purpose applications, ERP packages typically include source code and a
vendor-supporteddevelopment environmentfor customizing and extending the delivered code.[citation needed]
Materials requirements planning
MRP was the precursor to ERP. Large companies found great value in creating a common
foundation for automating information management for their manufacturing processes. Success
with MRP projects led companies and vendors to consider expanding to other functional areas.[citation needed]
Expansion
ERP systems experienced rapid growth in the 1990s because theyear 2000 and theEurodisrupted legacy systems. Many companies took this opportunity to replace such systems with
ERP. This rapid growth in sales was followed by a slump in 1999 after these issues had beenaddressed.[9]
ERP systems initially focused on automatingback office functions, indicating thatcustomersand
the general public were not directly involved.Front officefunctions such as customer
relationship management (CRM) dealt directly with customers, ore-businesssystems such as e-
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commerce, e-government, e-telecom, and e-finance, orsupplier relationship management(SRM)became integrated later, when the Internet simplified communicating with external parties.[citationneeded]
"ERP II" was coined in the early 2000s. It describes web-based software that allows both
employees and partners (such as suppliers and customers) real-time access to the systems."Enterprise application suite" is an alternate name such systems
SAP Net Weaver Application Server
SAP NetWeaver Application Serveris a component of theNetWeaversolution which works as a
web application server to SAPsolutions. From theSAPpoint of view the Web AS is the
foundation on which most of their product range runs.
All ABAP application servers including the message server represent the application layer of the
multi-tier architecture of an ABAP-based SAP System. These application servers execute ABAPapplications and communicate with the presentation components, the database, and also with
each other, using the message server
Architecture
The architecture of SAP Web Application Server can be separated into 5 areas:
Presentation layer
In the presentation layer, the user interface can be developed withJava Server Pages
(JSP), Business Server Pages (BSP), or with Web Dynpro technology. The underlying
business layer provides the business content in Java or ABAP.
Business layer
The business layer consists of a J2EE certified run-time environment that processes
the requests passed from the ICM and dynamically generates the responses. The
business logic can be written either in ABAP or in Java based on the J2EE standard.
Developers can implement business logic and persistence with Enterprise JavaBeans
(EJB) using the J2EE environment. Developers can also access the business objects of
applications running in the ABAP environment to benefit from their business logic and
persistence.
Integration layer
The local integration engine is an integral part of SAP Web AS and allows instant
connection toSAP XI. The local integration engine provides messaging services that
exchange messages between the components that are connected in SAP XI.
Connectivity layer
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The Internet Communication Manager (ICM) dispatches user interface requests to the
presentation layer and provides a single framework for connectivity using various
communication protocols. Currently, modules are available forHypertext Transfer
Protocol (HTTP), HTTPS (extension of HTTP running under the Secure Socket Layer
(SSL)), Simple Mail Transfer Protocol (SMTP), Simple Object Access Protocol (SOAP),
and Fast Common Gateway Interface (FastCGI).
Persistence layer
The persistence layer supports database independence and scalable transaction
handling. Business logic can be developed completely independent of the underlying
database and operating system. Database independence is also made possible by
support for open standards. The database interface ensures optimized data access
from within the ABAP environment through Open SQL. SAP propagates the
outstanding capabilities of Open SQL for ABAP to Open SQL for Java and offers a
variety of standardApplication Programming Interfaces (APIs) to application
programmers, such asSQLJ. Other technologies, such asJava Data Objects (JDO) and
container managed persistence (CMP) for EJB, or the direct use of theJava DatabaseConnectivity(JDBC) API, are also supported.
Security
Authentication
The SAP NetWeaver AS can accept multiple forms of authentication:
SAP Logon Ticketwith appropriate configuration [1].
Othersingle sign-on technology that utilizesx.509 certificates and the combinationofSecure Network Communications (SNC) andSecure Socket Layer(SSL) for onestandardize authentication platform.
Communications
The SAP NetWeaver Application Server's connectivity layer supportsHTTPSwhich is required
for encrypted communications viaSecure Socket Layer. It is possible to enable SSL using theSAP Cryptographic Library[2] . If a company is running with traditional SAP systems that only
usesRFCandDIAG protocols, Secure Network Communications is required for encrypted
communications as well[3]
SAP R/3SAP R/3 is the former name of the main enterprise resource planning software produced by
SAP AG. It is an enterprise-wide information system designed to coordinate all the
resources, information, and activities needed to complete business processes such as order
fulfillmentorbilling[1].
History of SAP R/3
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The first version ofSAP's flagship enterprise software was a financial Accounting system namedR/1 called as YSR. This was replaced by R/2 at the end of the 1970s. SAP R/2was in a
mainframe basedbusiness application software suite that was very successful in the 1980s and
early 1990s. It was particularly popular with large multinational European companies who
required soft-real-time business applications, with multi-currency and multi-language
capabilities built in. With the advent of distributedclientservercomputing SAP AG brought outa clientserver version of the software called SAP R/3 (The "R" was for "Real-time data
processing" and 3 was for3-tier). This new architecture is compatible with multiple platformsand operating systems, such as Microsoft Windows orUNIX. This opened up SAP to a whole
new customer base.
SAP R/3 was officially launched on 6 July 1992. It was renamedSAP ERPand later again
renamedECC(ERP Central Component). SAP came to dominate the large business applicationsmarket over the next 10 years. SAP ECC 5.0 ERP is the successor of SAP R/3 4.70. The newest
version of the suite is
Releases
SAP R/3 Release 3.1I
SAP R/3 Release 4.0B Release Date June 1998
SAP R/3 Release 4.5B Release Date March 1999
SAP R/3 Release 4.6A Release Date 1999
SAP R/3 Release 4.6B Release Date Dec 1999
SAP R/3 Release 4.6C Release Date April 2001
SAP R/3 Enterprise Release 4.70 Release Date March- Dec 2003 [2]
SAP R/3 Enterprise Edition 4.7
SAP R/3 Enterprise Central Component 5.0
SAP R/3 Enterprise Central Component 6.0(ECC6) SAP R/3 Enterprise Portal 7.0
Organization
SAP R/3 was arranged into distinct functional modules, covering the typical functions in place inan organization. The most widely used modules were Financials and Controlling (FICO),
Human Resources (HR), Materials Management (MM), Sales & Distribution (SD), and
Production Planning (PP)[citation needed].
Each module handled specific business tasks on its own, but was linked to the others where
applicable. For instance, an invoice from the billing transaction of Sales & Distribution wouldpass through to accounting, where it will appear in accounts receivable and cost of goods sold.
SAP typically focused on best practice methodologies for driving its software processes, butmore recently expanded into vertical markets. In these situations, SAP produced specialized
modules (referred to as IS or Industry Specific) geared toward a particular market segment,
such as utilities or retail.
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Technology
SAP based the architecture of R/3 on a three-tier client/server
1. Presentation Server(GUI)
2. Application Server3. Database Server
SAP allows the IT supported processing of a multitude of tasks, accruing in a typical company
or bank. SAP ERP is differing from R/3 mainly because it is based on SAPNetWeaver: corecomponents can be implemented inABAPand inJava and new functional areas are mostly no
longer created as part of the previous ERP system, with closely interconnected constituents, but
as self-contained components or even systems.
Presentation Server
The presentation server is actually a program named sapgui.exe. It is usually installed on auser's workstation. To start it, the user double-clicks on an icon on the desktop or chooses a
menu path. When started, the presentation server displays the R/3 menus within a window. This
window is commonly known as the SAPGUI, or the user interface (or simply, the interface). Theinterface accepts input from the user in the form of keystrokes, mouse-clicks, and function keys,
and sends these requests to the application server to be processed. The application server sends
the results back to the SAPGUI which then formats the output for display to the user.
Application Server
An application server is a collection of executables that collectively interpret the ABAP/4
(Advanced Business Application Programming / 4th Generation) programs and manage theinput and output for them. When an application server is started, these executables all start at
the same time. When an application server is stopped, they all shut down together. The number
of processes that start up when you bring up the application server is defined in a singleconfiguration file called the application server profile. Each application server has a profile that
specifies its characteristics when it starts up and while it is running. For example, an
application server profile specifies:
Number of processes and their types
Amount of memory each process may use
Length of time a user is inactive before being automatically logged off.
The Application layer consists of one or more application servers and a message server. Each
application server contains a set of services used to run the R/3 system. Not practical, only oneapplication server is needed to run an R/3 system. But in practice, the services are distributed
across more than one application server. This means that not all application servers will provide
the full range of services. The message server is responsible for communication between theapplication servers. It passes requests from one application server to another within the system.
It also contains information about application server groups and the current load balancing
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within them. It uses this information to choose an appropriate server when a user logs onto thesystem.
The application server exists to interpret ABAP/4 programs, and they only run there-the
programs do not run on the presentation server. An ABAP/4 program can start an executable on
the presentation server, but an ABAP/4 program cannot execute there. If your ABAP/4 programrequests information from the database, the application server will format the request and send
it to the database server.cvb
Database Server
The database server handles the user's request for addition, retrieval and modifications in
the data.
Security
Server-to-server communications can be encrypted with the SAP cryptographic library[3].
However, the SAP cryptographic library does not cover client-to-server encrypted
communications; an external technology coveringSecure Network CommunicationsandSecure Socket Layerwould have to be provided[4]
What is SAP Landscape?
Landscape is like a server system or like a layout of the servers or some may even call it the
architecture of the servers viz. SAP is divided into three different landscape DEV, QAS and
PROD.
- DEV would have multiple clients for ex: 190- Sandbox, 100- Golden, 180- Unit Test.- QAS may again have mutiple clients for ex: 300- Integration Test, 700 to 710 Training.
- PROD may have something like a 200 Production.
These names and numbers are the implementer's discreet on how they want it or they have been
using in their previous implementations or how is the client's business scenario.
Now whatever you do in the Sandbox doesn't affect the other servers or clients. Whenever youthink you are satisfied with your configuration and you think you can use it moving forward, you
RE-DO it in the golden client (remember, this is a very neat and clean client and you cannot useit for rough usage). As you re-do everything that you had thought was important and usable, youget a transport request pop up upon saving everytime. You save it under a transport request and
give your description to it. Thus the configuration is transported to the Unit Test client (180 in
this example).
You don't run any transaction or even use the SAP Easy Access screen on the 100 (golden)client. This is a configuration only client. Now upon a successful tranport by the Basis guy, you
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have all the configuration in the Testing client, just as it is in the Golden client. The
configuration remains in sync between these two clients.
But in the Testing client you can not even access SPRO (Display IMG) screen. It's a transactiononly client where you perform the unit test. Upon a satisfactory unit test, you move the good
configuration to the next SERVER (DEV). The incorrect or unsatisfactory configuration iscorrected in Golden (may again as well be practised in the sandbox prior to Golden) and
accordingly transported back to 180 (Unit Test) until the unit test affected by that particularconfig is satisfactory.
The Golden client remains the 'database' (if you wanna call it that) or you may rather call it the
'ultimate' reference client for all the good, complete and final configuration that is being used in
the implementation.
In summary:
Landscape : is the arrangement for the servers
IDES : is purely for education purpose and is NOT INCLUDED in the landscape.
DEVELOPMENT ---> QUALITY ----> PRODUCTION
DEVELOPMENT: is where the the consultants do the customization as per the company's
requirement.
QUALITY : is where the core team members and other members test the customization.
PRODUCTION : is where the live data of the company is recorded.
A request will flow from Dev->Qual->Prod and not backwards.
1. Sandbox server: In the initial stages of any implementation project, You are given asandbox server where you do all the configuration/customization as per the companies business
process.
2. Development Server: - Once the BBP gets signed off, the configuration is done isdevelopment server and saved in workbench requests, to be transported to Production server.
3. Production Server: This is the last/ most refined client where the user will work after
project GO LIVE. Any changes/ new develpoment is done is development client and the requestis transported to production.
These three are landscape of any Company. They organised their office in these three way.
Developer develop their program in Development server and then transport it to test server. In
testing server tester check/test the program and then transport it to Production Server. Later itwill deploy to client from production server.
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Presentaion Server- Where SAP GUI have.
Application Server - Where SAP Installed.
Database Server - Where Database installed.
What is the meaning of "R" in R/3 systems?
R/3 stands for realtime three tier architecture. This is the kind of architrecture SAP R/3 system
has.
R/3 means three layers are installed in Different system/server and they are connected with each
other.
1) Presentation
2) Application
3) Database
Why do we call client 000 as golden client?
Golden client contains all the configuration data and master data so some
extent. All the configuration settings are done in golden clients and
then moved to other clients. Hence this client acts as a master record
for all transaction settings, hence the name "Golden Client".
Why development client is called golden client of SAP ?
The Development Client is also the Golden Client because it has allthe correct configuration settings which have been tested and areerror free. The Golden Client is taken a
reference while performing some other configuration settings. You cannotchange any settings in the golden client.
because you can not post transactions in golden client. it is alsocalled configuration client. in other client in your developmentenvironment, you can post transaction and
do your unit testing as well.