SAP ERP Overview

By Bonnie D. Schmidt 5 months ago

This SAP overview defines SAP module and provides details on its structure and functions. In addition, this article describes the key benefits of using SAP.

Defining SAP

Systems Application and Products (SAP) is a powerful tool that integrates multiple business processes and functions into one comprehensive system.

In today’s world, many companies’ business functions are seldom integrated. Lack of integration across business lines raises the risk of duplication, mistakes, and inconsistency. The top graphic to the right shows the traditional system of organization, while the bottom graphic to the right depicts a business with integrated systems.

It is the integration of multiple business processes and functions into one comprehensive system that provides organizations the structure they need to be competitive in today’s world.

The main advantage of using SAP as your ERP system are following:

  • SAP is a powerful tool that integrate multiple business processes and functions into one comprehensive system
  • SAP reduces lack of integration across business line which will raise the risk of duplication, mistakes and inconsistency data
  • SAP provide different approach than their competitors in market. Each piece (module like FI, MM, SD) can operate independently from all other software. And the key benefit of using this approach is that companies can implement individual module that fits the company needs, and have the flexibility to add other module later when their business grows.

SAP is a modular system that consists of individual applications called application modules. Application modules can be grouped together to include a component.

All SAP components link into a central database which connects several business activities of the company and this central database is where all company data is stored.

Application modules are where most day-to-day tasks are performed. Each application module manages a different business function in SAP, designated by a two-letter code.

SAP implementations include the modules and module tools as follow:

  • Financial Accounting (FI)
  • Controlling (CO)
  • Fixed Assets Management (AM)
  • Project System (PS)
  • Sales and Distribution (SD)
  • Materials Management (MM)
  • Production Planning (PP)
  • Quality Management (QM)
  • Plant Maintenance (PM)
  • Human Resources (HR)
  • Business Workflow (WF)
  • Industry Solutions (IS)

Regard to key benefit of using SAP, SAP information is processed real-time, providing updated information as soon as data is saved into the system. Because modules connect the business activities of the company in one central database. SAP is referred to as an integrated system.

SAP Overview Summary

What we have learnt from the SAP Overview article are:

  • SAP is made up of individual application modules, each covering a different business function.
  • SAP application modules link into a central location where data is stored.
  • SAP includes Table Data, Master Data, and Transactional Data.
  • SAP reports information in different formats to various levels in the company.
  • SAP is a completely integrated system allowing for real-time functionality across the organization.

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