Thursday, February 19, 2009

What is SAP?

Contributed by Howard Foster

In 1972, five ex-IBM engineers founded SAP. Translated from German, it signifies Systems, Applications, Products in Data Processing. The full name of the parenting organisation is SAP AG. Located close to the town of Heidelberg, SAP has subsidiaries in 50 countries. Because of their success, the primary beginners have commercialise SAP AG into the 3rd biggest software maker in the world.

More than half of the Earth top 500 enterprises and over 17,500 customers make use of this software manufacturer. There are over 27,000 workers global and SAP AG requires a gross of $7.34 billion and a net income of $581 million in FY01. Because SAP is numbered in Germany it makes up the thirty stocks of DAX and on the New York Stock Exchange as ticker: SAP.

In 120 countries with more than 10 million users, there are 44,500 installations of SAP. Why did this organisation become successful? In 1979 SAP released SAP R/2 into the German market; it was a quick success! Every important German firm had SAP software and for years this firm stayed within Germany's boundaries. Finally, the software corporation thrived throughout Europe and towards the end of the 1980s, client-server architecture became famous.

SAP released R/3 and in 1988 it was published in the North America part which resulted in an important successful business adventure. It took only 5 yr for the North American market to take on 44% of total SAP world-wide sales. More than 3,000 people have added the names of many of the Fortune 500 to their customer based list. Presently SAP is available in 46 particular country versions, incorporating 28 languages; industry specific versions number 21. Huge corporations are no longer the pleased owners of SAP as smaller organizations have seen the need to incorporate this software into their business.

There are good reasons why firms are carrying out SAP. Substituting outdated and inefficient IT Architecture grants for a competitive reward. Other good reasons are to enable business process change since it is easier to change organizations procedure to adapt to SAP. There is a competitive advantage and of course this depends on the firm. Behind every thriving business is a cost benefit analysis. If SAP cannot be implemented with a good outcome than it in all likelihood should not be embarked on. A ballpark cost would be $4,000 and is set on a price per user with an annual support cost of 10% and periodic upgrades. Check with SAP for additional data.

The shortest time to execute SAP is 45 days, and there are multi nationals who remain to accomplish SAP over 5 to 10 yr and many have planned as prosperous world deployments but 1 should be capable to get a only example project accomplished in a little over a yr. The least of SAP implementations can be done on a part time basis and the broadest will involve up to a 1000 mortals including armies of consultants. The smallest SAP implementations uses a production system box, a box for examination and a box for growth. The broadest implementations use well over 100 boxes particularly if programmes are involved. This can cost from $400,000 to millions of dollars.

SAP can be all things to all enterprises, and it is here to stay.

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