What is SAP?
SAP stands for Systems Applications and Products in data processing. It was founded in 1972 by five entrepreneurs (Dietmar Hopp, Hasso Plattner, Hans-Werner Hector, Klaus Tschira, and Claus Wellenreuther) in Germany.
SAP is a software that helps businesses thrive, innovate, and run efficient work processes daily. Today, it is managed by SAP SE, a European multinational software corporation. They are particularly known for their multiple end to end application / service suites and have been expanding in scope covering new generation technologies. To visualize how big the SAP software is, it was stated that 77% of the world’s transaction revenue touches an SAP system.
SAP SE currently has 440,000 customers in more than 180 countries, 21,000+ SAP partner companies globally, and 100+ innovation and development centers.
See references sections of this post for sources of the mentioned statistics.
What is ERP?
ERP stands for Enterprise Resource Planning. In order to understand what this means, let us think about the core processes that are needed to run a company. These core processes can be Finance, HR, Manufacturing, Supply Chain, Procurement, and more. Now, let us take for example the scenario that each of these core processes are handled by different kinds of software’s. That would mean important data in different systems.
This time let us consider how each of these processes can relate to one another. For example, Financial processes greatly impact (and consider) the other core processes such as HR, Manufacturing, Supply Chain, Procurement, and more.
Why? Because Finance needs to record the other core process transactions. If we procure a material to create a finished product, we need to record the corresponding financial transaction. At the same time, by selling that finished product and even paying the employees, the corresponding financial transaction needs to be recorded.
Recall that the data in our example is scattered throughout several different systems. That entails a lot of data gathering in different formats in different systems just to see, analyze, check on the financial position of a company.
Given this example of how these core processes can impact and relate to one another, let us insert ERP into the picture. The concept of an ERP is to integrate these core processes into a single system.
SAP ERP Software
SAP is considered as an ERP System but given the advancements in technology, it is no longer just a basic ERP system that integrates several processes into a single system. From research, we can see technologies such as machine learning, artificial intelligence, and even internet of things can be integrated or added to create a next generation ERP system. Today, we even have cloud platforms, robotic process automation, predictive analytics for analysis, and more to enable even greater business efficiencies.
What Are The Advantages of SAP ERP?
Below are some of the advantages of SAP ERP:
Accelerated Reporting and Better Insights
With the data and core processes streamlined into one system, we are able to obtain data faster and understand where the business stands performance-wise, financial-wise, etc.
Improved Agility
Businesses need a way to improve their agility with the many sudden events occurring today. May it be economic related events, opportunities to grow or leverage a product, ERP systems can help you react to these events quickly.
Road to an Intelligent Enterprise
The outlook is to craft and enable businesses to become intelligent enterprises where processes are automated, innovation is a key factor, and real-time data insight / experiences are improved. ERP systems can enable this transition through the many features and next generation technologies.
What Are The Types of ERP?
- Cloud ERP – ERP using Cloud.
- On-Premise ERP – ERP using your own data center.
- Hybrid ERP – ERP using both Cloud and On-Premise. Also known as two-tier ERP.
When you say “on-premise”, you associate it to actual servers on your company’s premises / offices.
List of SAP Modules
In SAP, the modules are categorized into two: Functional Modules and Technical Modules. You may refer to the table below for more information.
| Category | Module | Expanded | Additional Notes |
| Functional | SAP FICO | Financial Accounting and Controlling | |
| Functional | SAP HR | Human Resource / Human Resource Management | |
| Functional | SAP HCM | Human Capital Management | Business Suite Application |
| Functional | SAP MM | Materials Management | |
| Functional | SAP SD | Sales and Distribution | |
| Functional | SAP FSCM | Financial Supply Chain Management | |
| Functional | SAP PS | Project Systems | |
| Functional | SAP PM | Plant Maintenance | |
| Functional | SAP QM | Quality Management | |
| Functional | SAP PP | Production Planning | |
| Technical | SAP BASIS | Programs and tools for interfacing with databases, operating systems, communication protocols and other SAP modules. | |
| Technical | SAP Security | Roles and Authorizations | |
| Technical | SAP ABAP | Advanced Business Application Programming (Default programming language for SAP) | |
| Technical | SAP HANA | High Performance Analytic Appliance (In-memory computing platform. Allows real-time data analysis) | |
| Technical | SAP NetWeaver | Technology platform that allows organizations to integrate data, business processes, etc. | |
| Technical | SAP IS | Information Systems Management | |
| Technical | SAP XI | Exchange Infrastructure | |
| Technical | SAP SolMan | Solution Manager | |
| Technical | SAP SCM | Supply Chain Management | Business Suite Application |
| Technical | SAP SRM | Supplier Relationship Management | Business Suite Application |
| Technical | SAP PLC | Product Lifecycle Costing | Business Suite Application |
| Technical | SAP GRC | Government, Risk, and Compliance | Business Suite Application |
| Technical | SAP SEM | Strategic Enterprise Management | Business Suite Application |
| Technical | SAP CRM | Customer Relationship Management | Business Suite Application |
| Technical | SAP CM SOA | Compliance Management for SOA | Business Suite Application |
| Technical | SAP BW | Business Data Warehouse (Also SAP BI) | Additional Component |
| Technical | SAP BI | Business Intelligence (Also SAP BW) | Additional Component |
| Technical | SAP APO | Advanced Planning and Optimization | Additional Component |
| Technical | SAP SFA | Salesforce Automation | Additional Component |
| Technical | SAP ITS | Internet Transaction Server | Additional Component |
List of SAP S/4HANA Modules
Following the latest technology (SAP S/4HANA), you may refer to some of the S/4HANA modules below.
Most of the changes lie on the SAP FICO module where it is currently known as SAP Finance. Finance processes have been streamlined, system architectural changes have been made, and other optimizations have been done. For more information, you can read this post: SAP S/4 HANA Finance | Key Features | Summary.
It should be noted that SAP CO is still present in S/4HANA but big changes have been made to prevent redundancy of data. As such, some CO tables and transaction codes have been decommissioned in SAP S/4HANA.
| Module | Expanded |
| SAP Finance | Previously known as Simple Finance. |
| SAP PM | Plant Maintenance |
| SAP HCM | Human Capital Management |
| SAP PP | Production Planning |
| SAP PS | Project Systems |
| SAP CO | Controlling |
| SAP SD | Sales and Distribution |
| SAP IM | Investment Management |
| SAP SEM | Strategic Enterprise Management |
| SAP CRM | Customer Relationship Management |
| SAP LIS | Logistics Information Systems |
| SAP SCM | Supply Chain Management |
| SAP MM | Materials Management |
| SAP SRM | Supplier Relationship Management |
References
I hope this helps. Good luck! 🙂
Techlorean. 