1. © The McGraw-Hill Companies, Inc., 2006 1 McGraw-Hill/Irwin Managerial Briefing 13 Enterprise Resource Planning Systems

2. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 2  Enterprise Resource Planning Defined  R/3 System Components  Reasons for Implementing R/3 OBJECTIVES

3. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 3 Enterprise Resource Planning (ERP) Systems  Enterprise Resource Planning Systems is a computer system that integrates application programs in accounting, sales, manufacturing, and other functions in the firm  This integration is accomplished through a database shared by all the application programs

4. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 4

5. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 5 SAP AG  The largest European software company and the largest ERP software company in the world with headquarters in Walldorf, Germany.  AG = Aktiengesellschaft = public company  SAP was founded in 1972 as Systemanalyse und Programmentwicklung by five former IBM engineers in Mannheim, Germany (Dietmar Hopp, Hasso Plattner, Klaus Tschira, Claus Wellenreuther and Hans-Werner Hector).  The acronym was later changed to stand for Systeme, Anwendungen und Produkte in der Datenverarbeitung ("Systems, Applications And Products in Data Processing“)

6. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 6 SAP AG  Main product: mySAP ERP  Predecessor: SAP R/3  Before SAP R/3: SAP R/2 (only for mainframe)  R = real time data processing  3 = 3-tier architecture: database server, application server and client/front end server (SAPgui)  GUI = Graphical User Interface

7. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 7 SAP AG’S R/3 - Designed to operate in a three-tier client/server configuration -Applications are fully integrated so that data are shared between all applications

8. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 8 SAP R/3

9. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 9 SAP ABAP  ABAP = Programming language used by SAP. It is a 4GL (fourth generation language)  ABAP = Allgemeiner Berichts aufbereitungs prozessor (Germany) = generic report preparation processor (English).  New English name = Advanced Business Application Programming.

10. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 10 SAP Industry Solution`: Customization  Automotive  Chemical  Electronics  Banking  Etc.

11. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 11

12. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 12 R/3 System Functional Components R/3 System Functional Components Sales & DistributionHuman Resources Manufacturing & Logistics Financial Accounting

13. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 13 Financial Accounting  Financials  Controlling  Asset management

14. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 14 Human Resources  Payroll  Benefits administration  Applicant data administration  Personnel development planning  Workforce planning  Schedule & shift planning  Time management  Travel expense accounting

15. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 15 Manufacturing & Logistics  Materials management  Plant maintenance  Quality management  Production planning & control  Project management system

16. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 16 Sales and Distribution  Prospect & customer management  Sales order management  Configuration management  Distribution  Export controls  Shipping and transportation management  Billing, invoicing, and rebate processing

17. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 17

18. McGraw-Hill/Irwin © 2006 The McGraw-Hill Companies, Inc., All Rights Reserved. 18 Reasons for Implementing SAP R/3  Desire to standardize and improve processes  To improve the level of systems integration  To improve information quality