Many of my social media friends have been asking me, what is SAP? So let us understand, what is SAP after all!
Most people work in services industries. Some other people work in industrial, agricultural sector etc. It is also a fact that most people use some kind of software applications in their work. These software applications can be broadly categorized as personal productivity applications, business applications, financial applications etc.
Let us understand each of these kinds of software applications.
Personal productivity software applications:
You use word processors like Microsoft Word, spread sheets like Microsoft Excel, presentation tools like Microsoft Power Point etc. These are personal productivity software applications tools.
Financial & tax software applications:
You use programs like Tally to do accounting and prepare tax calculations. These are financial & tax software application tools.
Business software applications:
People use some business applications tools for accounting, business transactions etc. These applications can do things like procure to pay business transactions, sales to cash business transactions, productions / manufacturing to inventory transactions etc. Some of these tools are capable of doing these transactions for small volumes. Examples include Microsoft Great Plains, Microsoft Solomon, Microsoft access etc.
For large organizations, these smaller business application tools are not a good fit. These tools can not take care of thousands or even millions of transactions on daily basis. For these large corporations, another kind of business applications are needed which can take care of these large volume transactions. Examples of these applications include SAP, Oracle Applications etc.
What is capability of SAP
A SAP system can take care of transactions for any very large corporation. Most of the largest fortune 500 companies use SAP as their business application tool. SAP applications suite is developed by SAP AG, a German company. To broaden their market, SAP AG also delivers pre-configured SAP systems for mid size companies. they also have pre-configured solutions for industry specific applications. For example, steel, paper, metals etc. industries need some special capability. SAP AG provides this capability in their solution for Mill Industries. Similarly they have packaged solutions for Oil & gas industry, defense industry, mining industry etc.
In my next post, I will discuss about structure of a SAP system.