1. Intro to SAP Enterprise Systems Configuration EGN Enterprise Systems Configuration (Professional MSEM) Fall, 2013

2. SAP R/3 Introduction Enables a company to link it’s business processes
ECC 6.0
January 2008
SAP R/3 Introduction
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 All rights reserved.
© SAP AG and The Rushmore Group, LLC 2008

3. SAP R/3 Introduction Central relational database
ECC 6.0
January 2008
SAP R/3 Introduction
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 All rights reserved.
© SAP AG and The Rushmore Group, LLC 2008

4. 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
,000 tables
,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 All rights reserved.
© SAP AG and The Rushmore Group, LLC 2008

5. 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 All rights reserved.
© SAP AG and The Rushmore Group, LLC 2008

6. 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 All rights reserved.
© SAP AG and The Rushmore Group, LLC 2008

7. 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 All rights reserved.
© SAP AG and The Rushmore Group, LLC 2008

8. Enterprise Systems (history & Evolution)

9. ECC 6.0
January 2008
SAP R/3 Introduction
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 All rights reserved.
© SAP AG and The Rushmore Group, LLC 2008

10. ECC 6.0
January 2008
SAP Configuration
The process of tailoring SAP software by selecting specific functionality from a list of those supported by the software, very much like setting defaults (e.g., Word, Access)
DOES NOT involve changes to the underlying software code
Very much like changing switches or setting defaults
Configuring is what you do to have the system be able to execute your business processes the way you want them to. (e.g. If you deliver steel, you don’t want a Ferrari, you want a semi-truck. SAP can be either depending upon how you configure it.)
Be careful with configuration. Once it is done, it is very difficult to undo.
January 2008
© SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved.
© SAP AG and The Rushmore Group, LLC 2008

11. Programming Code Modifications
ECC 6.0
January 2008
Programming Code Modifications
Changes to the delivered code
ABAP/4 – Advanced Business Application Programming (ABAP)
This should be done carefully as it can make migration to new versions of the software much more difficult
If you change the code, SAP will no longer support you.
You should FULLY research before you make the decision to modify.
Gateway Computer: not able to up-grade with JDE because they made so many changes. They were stuck with a version of software over a decade old without the functionality they needed with the newest releases.
January 2008
© SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved.
© SAP AG and The Rushmore Group, LLC 2008

12. Required data types: SAP Data Types
Organizational levels (data, elements)
Master data
Transaction data

13. Data type: Organizational levels
Defines the enterprise structure in terms of legal or business purposes, including legal entities, plants, storage areas, sales organizations, profit centers:
Client (e.g., 600)
Highest organizational level
Represents the enterprise consisting of many companies
Company Code (e.g., C099)
Identifies legal entities in an enterprise
Central organizational element in financial accounting
Organizational levels in Logistics
Plant (e.g. P099)
Represents factory, warehouse, office, distribution center, etc.
Storage locations (e.g., 10, 20, 30)
A location within a plant where materials are stored

14. Data Types: Organizational levels
Storage Locations
Plant
Company Code
Client
BPI Enterprise (600)
Pen Company (C099)
Pen Plant
(P099)
RM (30)
WIP
FG (10)
Pen Plant (P099)

15. Data Type: Organizational levels
Organizational levels in Accounting
Client
Company code
Business area
Controlling area
Operating concern
Organizational levels in procurement
Purchasing organization
Purchasing group
Plant
Storage location
Organizational levels in fulfillment (sales)
Sales organizations
Divisions
Distribution channel
Sales areas
Shipping point
Plant
Storage location
Organizational levels in PP
Work Center
Shipping Point

16. SAP Enterprise Structure Example
Procurement
Shipping Point
DL##
MI##
SD##
TO##
HD##
HH##
PE##
RM##
TG##
TG##
TG##
RM##
TG##
TG##
Storage Location
SF##
FG##
FG##
FG##
SF##
FG##
FG##
FG##
MI##
MI##
MI##
FG##
MI##
MI##
MI##
MI##
Central Purchasing Organization (global) GL##
Purchasing Org. US##
CA##
PO DE##
AU##
Purchasing Group North America
N##
PGr Europe
N##
Asia
AS##
CC: company code. CoA: chart of accounts (country-specific). CA: controlling area. Business Area: by products
Dallas
DL##
Miami
MI##
S. Diego
SD##
Toronto
TO##
Heidelb.
HD##
Hamburg
HH##
Perth
PE##
CC US##
CA##
CC DE##
AU##
Client GBI

17. SAP Enterprise Structure Example
Sales and Distribution
Distribution Channel Wholesale WH
Division Accessories AS
Division Bicycles BI
Distribution Channel Internet IN
SO West
UW##
SO West
CW##
SO North
DN##
SO North
GN##
SO North
AN##
CC: company code. SO: sales organization. Division: by product line
SO East
UE##
SO East
CE##
SO South
DS##
SO South
GS##
SO South
AS##
CC US##
CC CA##
CC DE##
CC GB##
CC AU##
Credit Control Area (global) GL##
Client GBI

18. Key Concepts in SAP Data Type: Master data
Long term data that represent entities of:
Procurement
Vendor
Material
Info records, source list
Fulfillment (Sales & Distribution)
Customer
Conditions (pricing, output)
Production
Bills of material
Work centers
Product routings

19. Key Concepts in SAP Types of Data: Transaction data
Data generated during executing process (steps) combining:
Organizational levels
Master data
Situational data (who, what, when, and where)
Example: sales order
Organizational levels: customer, company code, sales area
Master data: customer master, material master
Situational data: date, time, person, quantities

20. Key Concepts in SAP The Document concept Document types
An electronic record of transactions
Each transaction creates document(s)
Document types
Financial accounting documents (FI)
Management accounting documents (CO)
Material documents (goods movement)
Others

21. SAP R/3 Document Principle
ECC 6.0
January 2008
SAP R/3 Document Principle
Each business transaction that writes data to the database creates a uniquely numbered electronic document
Each document contains information such as
Responsible person
Date and time of the transaction
Commercial content
Once created, a document can not be deleted from the database
Every transaction is an electronic document. It keeps track of everything you do.
Allows users to track every action taken in a company. Simply put, it allows users to answer the question “Where’s my order.”
What
Where it is and where it came from, and where is it going next
When
Who
January 2008
© SAP AG - University Alliances and The Rushmore Group, LLC All rights reserved.
© SAP AG and The Rushmore Group, LLC 2008

22. Key Concepts in SAP The Document Concept: Transaction document Header
Line items

23. Key Concepts in SAP The Document Concept: Material Document
Document number
Created by
Date
Reference
Header
Quantity
Material
Location (Plant / Sloc)
Other data depending on process (vendor, customer)
Items

24. PEN, Inc. System Configuration Introduction EGN Enterprise Systems Configuration (for Professional MSEM) Fall, 2013

25. 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 All rights reserved.
© SAP AG and The Rushmore Group, LLC 2008

26. 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 All rights reserved.
© SAP AG and The Rushmore Group, LLC 2008

27. Enterprise Structure Plant Client (600) Chart of Accounts Company
Code (C_ _ _)
Fiscal Year
Variant
Credit Control
Area
Purchasing
Organization
Group
Shipping
Point
Sales
Distribution
Channel
Division
Sales Area
Controlling Area
SL10
SL20

28. Company configuration
Pen Inc. _ _ _US manufacturing Company
Vermillion SD, US
Facilities:
One manufacturing plant with warehouse in Vermillion (Plant)
Work Center
Storage Location
10 for Trading and finished goods
20 for Quality
30 for Raw materials
Shipping point
Sales Organization
Purchase Organization
Company configuration

29. The company to be configured
Cost Center Standard Hierarchy
ADMIN_ _ _ (Cost Center Group)
Acct-Finance
Administration
Purchasing
Information Tech
Sales _ _ _ (Cost Center Group)
Sales
Marketing
Distribution-Production Cost Center _ _ _ (Cost Center Group)
Warehouse
Production
The company to be configured

30. Pen Inc. : The company Products Trading Materials Finished products
BPEN _ _ _ (Barrel Pen)
CPEN _ _ _ (Click Pen)
PPEN _ _ _ (Premium Pen)
Box _ _ (Pen Box)
Finished products
EPEN _ _ _ (Executive Pen)
ESET _ _ _ (Executive Set)

31. Pen Inc. : The company Customers Customer Name City State Channel
Tanagers
Vermillion
SD , 57069
RE (C & V)
The Rushmore Group
SD, 57069 RE
SAP, America
Newtown Square,
PA, 19073
Promotional Products, Inc
Sacramento
Ca, 95814 WH
Pleasure Boats Buying Group
Miami
FL, 33010

32. Pen Inc. : The company Suppliers Vendor Name City State Zip code
Promotions Ltd _ _ _
Chico CA
95929
Slick Pens _ _ _
Milwaukee WI
53201
Premier Pens _ _ _
Baton Rouge LA
70803
Boxes inc _ _ _
Sioux Falls SD
57101
Tanager
Vermillion
57069

33. Pen Inc.: Key Processes Procurement (buy) Fulfillment (sell)
Production (make)
Material planning (plan)
Financial Accounting (track)
Management Accounting (track)
Inventory and Warehouse Management (store)
Enterprise Asset Management (maintain)
Customer Service (service)
HCM (people)

34. Pen Inc. : The company Information system requirement
The IS of the Pen, Inc. will
integrate and share all services for all business functions in the Vermillion Office
Centralize all ERP functions
Achieve the primary business objectives:
Reduce Costs
Deliver Best-in-Class Technology to all divisions

35. Exercises: due date – 8/10/2013
Create company code
Create chart of accounts
Assign company code to chart of accounts
Assign company code to fiscal variant
Create Credit control area
Assign company code to credit control area
Assign permitted credit control areas to company code
29. Define plant
30. Define storage locations (inventory and quality)
31. Define purchasing organization
32. Create purchasing group

36. Exercises: due date – 8/10/2013
33. Assign plant to company
34. Assign purchasing org. to company code
35. Assign purchasing org. to plant
36. Set up parameter ID
37. Create Account groups
38. Define retained earnings account
40. Assign company code to field status variant
41-57 Create 17 general ledger accounts
58. Run general ledger list of accounts reports