How To Select The Proper SAP Module For Your Business

Posted on January 20, 2009 @ 2:24 pm
by Donald Howard

SAP is the short form of Systems, Applications and Products. SAP is not simply the name of worlds 1 of the widest software development corporation but too the name of the software product developed by this enterprise. SAP AG, the authorized name of the organisation since it was shaped in Germany, earlier thought of providing customers with a tool with which they can interact with a single master info base for each and every application needed across the organisation.

The idea of the tool become practical in the form of a financial accounting system identified SAP R/1, the first version of SAPs iconic enterprise software. The improved version of this application, SAP R/2, was set up towards the end of 1970s, which was mainframe based business application software. Afterwards, SAP AG launched a client -server version of the software named SAP R/3, after the advent of distributed customer -server computing.

SAP R/3 Functionality:

SAP applications, made round their latest R/3 system allows R/3 to treat accomplished operation and management tasks throughout the organisation. That implies, SAP R/3 offer the users with the instrument to supervise financial, asset, and cost accounting, production operations and materials, personnel, plants, and archived documents. It functions on Advance Business Application Programming (ABAP), which is a fourth generation programming language. The R/3 system is compatible with several platforms including Windows 2000 and uses the client/server model.

SAP R/3 Modules:

SAP R/3 is made up of several personalized running software modules. These modules combine to execute every of the working and management tasks of any organization. All individual functioning module handles specified activities on its own, but is related to the others where applicable. The most widely used modules are – Logistics, Accounting and Human Resources.

Logistic Module:

Logistics is the way of supplementary a process from starting to finish on request e.g. delivering a product at its desirable location, on request. Different tasks needed in this process are Sales and Distribution, Production Planning, Materials Management, Plant Maintenance and Quality Management etc among others, each of which are integrated by Logistic module. The varied components of this module and illustration of their functions are:

Logistic Module

Sales and Distribution module: Presales support, customer enquiry processing, quotation working, sales order processing, delivery forming, billing and sales information system.

Material Management module: Purchasing processes, warehouse management, inventory, invoicing etc.

Production Planning module: Planning & preparing production operation e.g. transport and storage of raw materials, by-products and waste etc.

Plant Maintenance module: Repair of buildings, maintenance of equipment used in the production procedure, info about machine usage and possible downtime etc.

Quality Management module: All processes associated to the quality assurance of the product.

Accounting Modules:

This module executes every last financial and accounting actions or in other words this module meets every last financial and accounting needs of the company. It is automated to offer management and reporting of ledger, receivables & payments etc. which in turn allows balance sheets and Profit & Loss (P&L) accounts to be self updated, continuously. Thus, the elementary advantage of this module is that the book reflects the real situation. The several elements of this module are:

Accounting Module Examples

Financial Accounting: Accounting functions like balance sheet, Profit & Loss statements, Compliance with accounting regulations etc.

Controlling: Controls cost as well as corporations targets, Provides information needed for decision making and future preparation.

Enterprise Controlling: Collates internal data with market information to bring out subjects in marketing strategies.

Treasury: Corporate banking, Money, budget management etc.

Capital Investment Management: Aids finance corporations in their capital investments and tracking.

Project System: Project Management I, Project budgeting, Project execution/integration, Information system, Operative structures, Project planning etc.

Human Resources Modules

As the words itself specifies, Human Resource Modules leaves a accomplished HR management system, handling arenas such as personnel planning and recruitment, personnel and salary administration, payroll and personnel development.

Initially, SAP executions as well as its training were coordinated on module lines. For illustration, in a training class on Logistics, you would learn many things about SD such as SD-MD, SD-GF, SD-SLS etc but not much about the rest of the SAP system and how SD fits into it. So, the integration between modules was altogether absent. This used to result to that, the results were optimized on the modules, but missed in integration. So, to accomplish that integration, programs are nowadays being organised along the procedure lines such as:

Order to Cash (including parts of SD, FI-AR and probably TY as well)
Purchase to Pay (including MM-Purchasing and FI-AP)
Record to Report (FI-GL etc)

With adjustment of procedure lines alternatively of modules for solutions, SAP now are moving away from describing their system as a set of modules, and now are applying the term results. These Fresh Dimension Products can stand exclusively or be integrated with R/3. Its profits include elimination of duplication, discontinuity and redundancy in data and growths the return on investment made on IT implementations. It delivers quality information designed for the Enterprise as a completely Faster and cheaper which in turn presents quality info to make a quality corporation. These results are:

Human Resources
Customer Relationship Management
Supplier Relationship Management
Product Lifecycle Management
Supply Chain Management
Business Intelligence


SAP is an Corporation Wide Business Answer. This signifies that organisations running SAP can effectively integrate all of its business actions including finance, purchasing, sales, human resources etc. This integration allows each business proceedings in an organisation are available to all regions of that organization and there is no duplicate of info in separated systems.

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