All about SAP Software

SAP (pronounced by saying each letter individually, like IBM or ABC) is the pioneer in enterprise systems.

sapSAP was the first company to build a packaged enterprise system, which means that it designed a single piece of software that is used by many companies. Prior to that time, software developers had to create customized software for every company, which was prohibitively expensive. SAP introduced the first integrated, end-to-end enterprise system, called SAP® R/3, in 1992.

The “R” in R/3 stands for “real time.” Prior to the development of enterprise systems, companies typically employed a number of different systems, each of which supported a single function or department. Thus, there were sales systems, accounting systems, manufacturing systems, and so on. These systems were not integrated, so sharing data between and among them was problematic. As you might expect, this architecture regularly experienced delays in executing business processes because data had to be transferred from one system to the next as the process was being performed. SAP R/3 was designed to eliminate these inefficiencies by executing an entire process from start to finish and consolidating all of the process data in a single database. Consequently, regardless of which individuals were completing a step in the process, all of the data were available to them in real time. In addition, everyone else in the company could see the status of the process in real time as well.

In today’s age of Twitter and RSS feeds, this development might seem trivial. At the time, however, it was a crucial innovation. SAP R/3 was quickly adopted by one major corporation after another, and it catapulted SAP software onto the “must do” list for nearly every large company. By 2010, SAP had more than 110,000 customers in over 120 countries, including nearly every Fortune 1000 company. In 2008, SAP’s market share in the ERP category was equivalent to the market share of the next four largest ERP vendors—combined.3, 4 Today, more than 75% of SAP’s customers are small and medium-sized businesses.

Enterprises of every size, in every industry, all over the world use SAP software to manage their business operations. Regardless of where you live, nearly every major corporation, government entity, and nonprofit organization you are familiar with runs the same SAP software that you will use in this course. Before you start to think that this book is a marketing brochure for SAP, you should understand why we have explained SAP’s strategic importance in business and have selected SAP ERP as the reference system for this textbook. One of the most lucrative and rewarding careers in the IT industry for nearly 20 years has been that of an SAP consultant.5 Contrary to what you may have heard, most SAP consultants are not programmers.

Rather, they are MIS and business majors who have developed a process perspective on business and have become competent in a specific capability of the SAP ERP system. However, even technical programmers who wish to work with SAP must have a deep understanding of how business works in order to program applications that enable business processes to operate more efficiently.

Integrated Business Processes with ERP Systems will incorporate a number of demonstrations, examples, and hands-on exercises using SAP ERP. Several other companies offer enterprise systems that have similar capabilities, but it would be very difficult to explain how processes are executed in each of them. We have chosen to include the most prevalent and widely used ERP system that you are likely to encounter in your career.

When SAP first introduced R/3, almost anybody could claim to be an R/3 expert and thus become a highly paid consultant. Unfortunately, this practice led to quite a few well-publicized project failures. In response, SAP introduced certifications for the various modules and technical skills required to be a properly trained consultant. This arrangement enabled consultants who participated in SAP training programs and demonstrated a high degree of skill to distinguish themselves for potential employers.

Cogent Consulting deliver process improvements and automation for SAP customers in procure to pay and order to cash. To achieve this we use a combination of market-leading software, expert SAP and business consulting and importantly our experience from supporting more than 40 SAP customers to realise significant benefits in their shared service centres.


Today, SAP provides more than 100 certification types, classified by solution, focus area, and role. Each certification type specifies three levels of skill: associate, professional, and master. It can take many years and tens of thousands of dollars to progress up to master-level certification. SAP is very proud of the high level of knowledge and skills that are required to earn certification.

As you probably suspect by now, the SAP testing process is extremely rigorous. Because an SAP certification is such a highly valued credential, once you have earned one, SAP provides you with a certification number that can be listed on your resume or CV and verified by potential employers—the thousands of consulting companies that implement SAP software and the more than 110,000 (in 2010) companies that run SAP software. As an added benefit to students enrolled at universities or technical schools that are members of the SAP University Alliances Program, SAP offers special certification academies on campuses around the world where students can earn the same certification as professionals at a reduced cost. This textbook and the additional online materials are based on the content in the SAP course, which results in an official SAP Associate Application Consultant certification and can be used as a supplement to the SAP course materials.

Alternatively, students who master the additional online materials can take the SAP certification exam at one of over 8,000 global testing centers without participating in a certification academy. Students who pass the exam will receive the same official SAP certification as working professionals who complete an SAP-sponsored training pro- gram. Earning this certification is the first step toward a successful and perhaps lucrative career as an SAP application consultant. Speak with your instructor, and consult the certification information on the SAP University Alliances Community for more details.

C. Pang, Y. Dharmasthira, C. Eschinger, and K. Motoyoshi, Market Share: ERP Software, Worldwide, 2008, July 2008, Gartner.

A. Pang, Worldwide ERP Applications 2009–2013 Forecast and 2008 Vendor Shares, October 2008, IDC

J. Sahadi, Hot 6-fi gure jobs now, 2007 [Online], CNN/Money. 2007/pf/0708/gallery.hot_six_fi g_jobs_now/index.html.