Enterprise Systems Modeling EGN 5620 Enterprise Systems Configuration Professional MSEM Fall, 2012

Enterprise Systems Modeling Concepts and Tools EGN 5622 Enterprise Systems Integration

Information systems modeling tools IDEF IDEF0 (activities) IDEF1x (information) IDEF2x (dynamics) OMT Functional model Object model Dynamic model

IDEF Concept (1) IDEF (ICAM Definition) ICAM Objective Developed by the US Air Force Integrated Computer Aided Manufacturing (ICAM) Programs in 1981 ICAM Objective To develop structured methods for applying computer technology to manufacturing and to better understand how best to improve manufacturing productivity

IDEF Concept (2) IDEF0 IDEF1 IDEF2 An activity model of a manufacturing system and environment IDEF1 An informational model of the system and environment IDEF2 A dynamic model to describe time-varying system behavior

IDEF Concept (3) IDEF Methodology Commercial IDEF software tools Modeling process and tools, leading to creation of the three IDEF models IDEF0 (activities) IDEF1x (information) IDEF2x (dynamics) Commercial IDEF software tools Design/IDEF by Meta Software Company AI0WIN by Knowledge Based Systems Inc.

OMT Concepts (1) Object modeling technique (OMT) “Object-oriented” means: Software organized as a collection of discrete objects that incorporate both data structure and behavior, in contrast to conventional programming in which data structure and behavior are only loosely connected. OMT Methodology (in stages): system analysis, system design, Object (implementation) design, and implementation.

OMT concepts (2) - common themes Synergy (i.e., shifting focus from coding technique to packaging, based on consistent identity, classification, polymorphism, and inheritance Abstraction, Encapsulation, Combining data and behavior, Sharing (inheritance of data structure & behavior among subclasses) Emphasis on object structure (not procedure structure),

OMT Concepts (3) - Synergy Identity Data is quantized into discrete, distinguishable entities called objects Classification Objects with the same data structure (attributes) and behavior (operations) are grouped into a class An operation is an action or transformation that an object performs or is subject to. polymorphism The same operation may behave differently on different classes. A specific implementation of an operation by a certain class is called a method. Each operation may have multiple methods implementing it. inheritance The sharing of attributes and operations among a hierarchy of object classes

OMT Models (4) 3 OMT models used to describe a system: Object model describing the objects in the system and their relationships; Dynamic model describing the interactions among objects in the system; and Functional model describing the data transformation of the system. Their relationship The object model describes what changes (or transforms) before when (dynamic model) or how (functional model) it changes.

OMT Functional Model (5) It describes the data value transformations within a system. The functional model contains data flow diagrams. A data flow diagram is a graph whose nodes are processes (activities) and whose arcs are data flows.

OMT Object Model (6) It describes the static structure of the objects in a system and their relationships. The object model contains object diagrams. An object diagram is a graph whose nodes are object classes and whose arcs are relationships among classes.

OMT Dynamic Model (7) It describes the aspects of a system that change over time and is used to specify and implement the control aspects of a system. The dynamic model contains state diagrams. A state diagram is a graph whose nodes are states and whose arcs are transitions between states caused by events.

Relationship between the two techniques & among the three models IDEF0/functional model The input to an activity is usually through a user interface for data entry The output from an activity is usually a user interface for a report, though the output may be a write/update to a database. IDEF0’s ICOM Material is an input object. Product/process data are output objects. Rules/regulations and SOPs are constraints. Technical precedence is a constraint Resources/tools and methods are a mechanism. IDEF1/object model The collection of the ICOM of an IDEF activity model constitutes an inclusive foundation for the object model. IDEF2/dynamics model Each object requires a state diagram to define/govern its life-cycle behavior. A triggering event is associated with each transition from one state to another. One state may transform to multiple states, depending on the triggering event.

SAP System Modeling Design EGN 5622 Enterprise Systems Integration

SAP R/3 Enables a company to link it’s business processes ECC 6.0 January 2008 SAP R/3 Enables a company to link it’s business processes Ties together disparate business functions (integrated business solution) Helps the organization run smoothly Real-time environment Scalable and flexible The real benefit of ERP is a single point of data entry. Linked everything that we were trying to teach students. Students finally understood why they had to take the classes they had to take. It put it all together. Nay sayers were saying only large enterprises only use SAP. If the students got hired in a large company they would be in a silo. The students who really benefited are the ones who worked in small companies because they understood the whole business process and their jobs have a broader range of duties. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Architecture Central relational database Client/Server – three-tiered ECC 6.0 January 2008 Architecture Central relational database Oracle, Informix, Microsoft SQL, etc. Client/Server – three-tiered ERP Components – Oriented towards common identifiable business modules: MM, SD, PP, FI, CO, HR, WM, QM, PM Add-ons: Customer Relationship Mgmt (CRM) Supply Chain Mgmt (SCM) Product Lifecycle Mgmt (PLM) Business Intelligence (BI) Multiple database options ERP components are standard business functions: FI (finance), MM (Materials Management), SD (Sales & Distribution), CO (Controlling), PP (Production Planning), HR (Human Resources) Many add-ons Add on focus on specific market niches or business functions. Two of the most popular are CRM and SCM January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

ECC 6.0 January 2008 Relational Database Tables: Defines and links a couple of tens thousands of tables of information (25,000+) Advantages Consistent and accurate data Common definitions for terms Shared, but restricted usage (e.g., profiles) Eliminates data redundancy 3.0d had 7,000 tables 3.8 - 11,000 tables 4.6 - 18,000 tables If you know everything about SAP, your lying. It is just too big. Your profiles dictates what you can see. This is the only time you will have access to the complete system. You can do anything, including take the system down. Audit trail – You can tell which student took it down, and they will take care of it themselves. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Client/Server Environment ECC 6.0 January 2008 Client/Server Environment Client Software/hardware combination that can make a request for services from a central repository of resources Server Software/hardware combination that can provide services to a group of clients in a controlled environment What is Client-server Computing? The short answer: Client/server is a computational architecture that involves client processes requesting service from server processes. The long answer: Client/server computing is the logical extension of modular programming. Modular programming has as its fundamental assumption that separation of a large piece of software into its constituent parts ("modules") creates the possibility for easier development and better maintainability. Client/server computing takes this a step farther by recognizing that those modules need not all be executed within the same memory space. With this architecture, the calling module becomes the "client" (that which requests a service), and the called module becomes the "server" (that which provides the service). The logical extension of this is to have clients and servers running on the appropriate hardware and software platforms for their functions. For example, database management system servers running on platforms specially designed and configured to perform queries, or file servers running on platforms with special elements for managing files. It is this latter perspective that has created the widely-believed myth that client/server has something to do with PCs or Unix machines. What is a Client process? The client is a process (program) that sends a message to a server process (program), requesting that the server perform a task (service). Client programs usually manage the user-interface portion of the application, validate data entered by the user, dispatch requests to server programs, and sometimes execute business logic. The client-based process is the front- end of the application that the user sees and interacts with. The client process contains solution-specific logic and provides the interface between the user and the rest of the application system. The client process also manages the local resources that the user interacts with such as the monitor, keyboard, workstation CPU and peripherals. One of the key elements of a client workstation is the graphical user interface (GUI). Normally a part of operating system i.e. the window manager detects user actions, manages the windows on the display and displays the data in the windows. What is a Server process? A server process (program) fulfills the client request by performing the task requested. Server programs generally receive requests from client programs, execute database retrieval and updates, manage data integrity and dispatch responses to client requests. Sometimes server programs execute common or complex business logic. The server-based process "may" run on another machine on the network. This server could be the host operating system or network file server; the server is then provided both file system services and application services. Or in some cases, another desktop machine provides the application services. The server process acts as a software engine that manages shared resources such as databases, printers, communication links, or high powered-processors. The server process performs the back-end tasks that are common to similar applications. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Three-Tier SAP Structure ECC 6.0 January 2008 Three-Tier SAP Structure GUI – Graphical User Interface or Web Interface Application server (one or many) Database server (one single location) World wide companies have redundant servers that back up real time. What is a Two-Tier Architecture? A two-tier architecture is where a client talks directly to a server, with no intervening server. It is typically used in small environments (less than 50 users). A common error in client/server development is to prototype an application in a small, two-tier environment, and then scale up by simply adding more users to the server. This approach will usually result in an ineffective system, as the server becomes overwhelmed. To properly scale to hundreds or thousands of users, it is usually necessary to move to a three-tier architecture. What is a Three-Tier Architecture? A three-tier architecture introduces a server (or an "agent") between the client and the server. The role of the agent is manyfold. It can provide translation services (as in adapting a legacy application on a mainframe to a client/server environment), metering services (as in acting as a transaction monitor to limit the number of simultaneous requests to a given server), or intelligent agent services (as in mapping a request to a number of different servers, collating the results, and returning a single response to the client. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

SAP Enterprise System Network Presentation Application Database ECC 6.0 January 2008 SAP Enterprise System Database Application Presentation Browser Client PCs, Laptops, etc. Network Application Servers Internet Transaction Server Web Server 3-tier client server system Web server Internet transaction server Brings it to a single database across the world. What is Client-server Computing? The short answer: Client/server is a computational architecture that involves client processes requesting service from server processes. The long answer: Client/server computing is the logical extension of modular programming. Modular programming has as its fundamental assumption that separation of a large piece of software into its constituent parts ("modules") creates the possibility for easier development and better maintainability. Client/server computing takes this a step farther by recognizing that those modules need not all be executed within the same memory space. With this architecture, the calling module becomes the "client" (that which requests a service), and the called module becomes the "server" (that which provides the service). The logical extension of this is to have clients and servers running on the appropriate hardware and software platforms for their functions. For example, database management system servers running on platforms specially designed and configured to perform queries, or file servers running on platforms with special elements for managing files. It is this latter perspective that has created the widely-believed myth that client/server has something to do with PCs or Unix machines. What is a Client process? The client is a process (program) that sends a message to a server process (program), requesting that the server perform a task (service). Client programs usually manage the user-interface portion of the application, validate data entered by the user, dispatch requests to server programs, and sometimes execute business logic. The client-based process is the front- end of the application that the user sees and interacts with. The client process contains solution-specific logic and provides the interface between the user and the rest of the application system. The client process also manages the local resources that the user interacts with such as the monitor, keyboard, workstation CPU and peripherals. One of the key elements of a client workstation is the graphical user interface (GUI). Normally a part of operating system i.e. the window manager detects user actions, manages the windows on the display and displays the data in the windows. What is a Server process? A server process (program) fulfills the client request by performing the task requested. Server programs generally receive requests from client programs, execute database retrieval and updates, manage data integrity and dispatch responses to client requests. Sometimes server programs execute common or complex business logic. The server-based process "may" run on another machine on the network. This server could be the host operating system or network file server; the server is then provided both file system services and application services. Or in some cases, another desktop machine provides the application services. The server process acts as a software engine that manages shared resources such as databases, printers, communication links, or high powered-processors. The server process performs the back-end tasks that are common to similar applications. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

R/3 SAP ERP Modules Client / Server Integrated Business Solution FI CO ECC 6.0 January 2008 SAP ERP Modules R/3 FI Financial Accounting CO Controlling PS Project System WF Workflow IS Industry Solutions MM Materials Mgmt. HR Human Resources SD Sales and Distribution PP Production Planning QM Quality PM Plant Maintenance SM Service Client / Server Integrated Business Solution EC Enterprise AM Fixed Assets Green ones (and blue): Logistics Blue: Separated for this course even though it is in logistics Start out with sales and distribution Yellow HR was added later in SAP’s life (1990) Red: Tracking side of house. (Financials) Purple:Workflow is the least understood by faculty and students Allow the movement of information in the enterprise to the people who need it. (e.g. Credit limit – e-mails, updates) Industry Solutions: Each install is tracked by SAP and the configuration is monitored by industry. This way SAP knows the whole set of answer of how industries works with their best business practices. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

ECC 6.0 January 2008 Business Modules Collections of logically related transactions within identifiable business functions MM (“Buy”) PP (“Make”) SD (“Sell”) FI and CO (“Track”) HCM (“People”) These are the basics, or fundamentals of how a company runs. We make, buy, sell, track, and manage the employees We teach this to graduate, undergraduate, and the high school level The concept of commerce is very easy for the students to understand. Start with the basics and then you can make it more and more complex as you go along January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

ECC 6.0 January 2008 SAP R/3 Basics Instance – each install of the SAP R/3 software on an individual application server Configurable – each instance can be distinctively configured to fit the needs and desires of the customer (within limits) Most of the infrastructure decisions, including configuration decisions, occur during project implementation Configurable – Not a single line of code to set this up. Change options in configuration January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

SAP Business Processes Integration (Overview) ECC 6.0 January 2008 SAP Business Processes Integration (Overview) Draw picture of stool Seat – Transactions Supported by Leg 1 – Organizations data Leg 2 – Master data Vendor, customer, material Leg 3 – Rules Govern how a transaction is used in the system SAP is an erector set You can create anything you want with it, the problem is converting it to something else is not easy. You can’t readily dismantle it too easily. Did you define what you wanted it to do before you started. One is the biggest problem is people do not define what you want before they start. EGN 5622 Enterprise Systems Integration © SAP AG and The Rushmore Group, LLC 2008

Business Process Integration (II) ECC 6.0 January 2008 Business Process Integration (II) MM PP SD Transactions Org Data Master Data MM PP SD Rules MM PP SD FI FI FI MM In the Business Process Integration class we use the stool as a metaphor for the SAP structure. There are four basic components needed to run execute SAP. Three of these are the legs of the stool: org data, master data, and rules. These ‘hold up’ the transactions. Transactions cannot be run unless these are setup. The legs are typically configured during the implementation process. During BPI 1 we will setup the stool for Finance, Materials management and Sales and Distribution. PP SD January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Learning Approaches Cross business functions ECC 6.0 Learning Approaches January 2008 Cross business functions Understand business processes and their relationships to SAP's organizational structure Highlight integration/configuration!! Levels are SAP Training: Level one: Introductory Level Two : Focus on transactions Level three: how we set up the system to work the way we want it to ww.sap.com/usa/education/cirriculum/cirriculum.asp?rid SAP teaches it from a very functional perspective. Consultant or a silo perspective. This works well in everyday business, but we want to teach students/executives how it all works together. We are going across the functional areas. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Learning by Creating a Model Business ECC 6.0 January 2008 Learning by Creating a Model Business Understanding business processes and their integrative nature Understanding SAP organizational structures Combining business processes and SAP organizational structure (i.e., configuration) Test the newly configured system View system outputs - statistics, reports, and graphics You are actually going to start from scratch. Financial Organizational Structures Material Master Org. Structures Sales and Distribution structures Rules then run transactions January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

PEN, Inc. System Modeling Design EGN 5622 Enterprise Systems Integration

Pen Inc. Start-up company in the promotional pen business ECC 6.0 January 2008 Pen Inc. Start-up company in the promotional pen business Initially buys and re-sells different lines of promotion pens Sells to both wholesale and retail – procure and distribute Later acquires a production facility to manufacture its own product – produce and distribute We will setup and execute the 3 major processes an organization We created a pen because it was very easy to setup and understand. The IDES has a motorcycle, but that is more complex than we need to teach the system. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Pen Incorporated Procure for Sales Order ECC 6.0 January 2008 Pen Inc. Business Module I for Selling Trading products Pre-Sales Activity Sales Order Delivery Billing General Ledger Accounts Purchase Requisition Purchase Order Goods Receipt In Inventory Plant or Warehouse Invoice Receipt Availability Check NO YES Goods to Delivery Goods from Purchase Order Inventory Postings Accounts Receivable Payable Can start out with a pre-sales activity Then to Order processing Became an order Check inventory – If not… Buy Receive Goods Assign to sales order Send to customer Bill customer Pay Vendor Account for all activities General ledger either the balance sheet or income statement Pen Incorporated Procure for Sales Order January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Pen Inc. Business Module II for Selling Finished Goods by Production ECC 6.0 January 2008 Pen Inc. Business Module II for Selling Finished Goods by Production Pre-Sales Activity Sales Order Delivery Billing Planned Order Production Order Completion Confirmation In Inventory Plant or Warehouse Availability Check NO YES Goods Issued to Delivery Goods from Production Order General Ledger Accounts Inventory Postings Accounts Receivable Issue Goods to Production Order Purchase Requisition Purchase Order Goods Receipt Invoice Receipt Accounts Payable NO Can start out with a pre-sales activity Ended up in Order processing Became an order Make Plan execute production order Issue goods Complete to inventory Cost Assign to sales order Send to customer Bill customer Account for all activities NO January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. © SAP AG and The Rushmore Group, LLC 2008

Exercises: 1 Display chart account 2 Review a listing of the general ledger (G/L) accounts 3 Create general ledger account 4& 4A Post transfer of funds to alternate bank account 5 Post purchase of operating supplies 6 Display general ledger account balance 7 Display multiple general ledger account balances 8 Display individual items while displaying general ledger account balances 9 Change financial accounting document 10 Display change to financial accounting documents 11 Create invoice receipt for rent expense 12 Display and review general ledger account balances and individual line items 13 Display and review accounts payable balances and individual line items

Exercises: 14. Post payment to landlord 15. Display and review general ledger account balances and individual line items 16. Display and review accounts payable balances and individual line items 17. Run balance sheet/profit and loss statements 18 Create sales order 19 Create delivery note for sales order 20 Pick materials on delivery note 21 Post goods issue 22 Create billing for customer 23 Post receipt of customer payment 24 Review document flow 25 Run balance sheet/profit and loss statements