SAP Tutorial - Background Material

Learning SAP

Background Material
Why this Blog? I have gone through many websites and blogs and found them to be too technical or having very little value. So I decided to
write my own experience in my own way without going into too many technical details, hoping these ramblings would serve someone who is
looking to roll out SAP. The Blog is for everyone, but it will be certainly more for those who are thinking of implementing SAP within their
organization.
Comments and criticism are welcome from one and all. I dont claim to be an EXPERT in SAP as the SAP Universe is huge and I am a mere
mortal human. So lets begin.
I will keep this training Material simple yet powerful enough, for the beginner having no idea as to HOW SAP Works.
SAP is an ERP (Enterprise Resource Planning) software and much more as we will see later. The Software is one of most popular ERP
software worldwide catering to business need of diverse businesses.
SAP is a composite Business Application having many components and each of those components may have several modules and each of
those modules serve a specific business area. The major components are called Financials (FI), Production (PP), Material Management
(MM), Sales and Distribution (SD), Human Resources (HR) etc.
These components are connected to each other very well and that is why it is called an integrated ERP. The tight integration between
components eliminates duplicity of data and also ensures that information comes from a single source resulting in better quality of decision
making.
When an organisation takes the decision to roll-out or implement SAP within it, it has to first ask some questions as to why it is investing the
time, money, and efforts. What are the business benefits that will be achieved by implementing SAP? How many of those benefits are
quantifiable? What is the ROI and how it will be achieved? Do we have clear cut Business Processes Defined? Is there scope of further
optimization of those processes during ERP Implementation? Do we have enough knowledge of business processes within the organization
to take on this challenge?
After getting answers to these above questions it still has to decide on the components that will be used by its users. For example, a
manufacturing company may decide to use SD, PP, QM, MM, FI in the beginning. The component based structure of SAP allows you to use
selective components and modules and when you think your foundation is strong, you systems are stabilised you can think about rolling out
other components, business functions. The key to success here is a far sighted vision. The business should be able to visualize about its
future position and alignment with SAP clearly so that there are no bottlenecks in future.
From my own experiences I can say that all complex business processes can be mapped in SAP ERP. Once you have the conviction and
gathered enough knowledge about your business processes, take the bull by horns.
After taking the decision in favour of SAP, the next critical task is to find a good implementation partner / vendor who has got enough
knowledge about your business domain and done some implementations in similar organisations. It is the implementation partner / vendor
who will ensure correct configuration of SAP ERP as per your business needs. The people deployed by ERP Implementation Partner or
Vendor will work as Team with your business people and map all your requirements in SAP ERP.
So you will have to ensure that the people to be deployed by your selected implementation partner are up-to-the-mark and have decent
knowledge of business processes similar to yours as well as good knowledge of SAP ERP Configuration.
Okay so you have finalised on SAP ERP, found the right implementation partner / vendor, the next task is creating the Hardware Infrastructure
or Outsourcing it as the case may be. Selection of Servers for SAP ERP is very crucial and important as you wont be able to change the
infrastructure rapidly so my advice is plan well and plan the hardware for tomorrow as well. There are tools available to help you in
determining what kind of hardware you will need and we will describe them later. Also please note that most major hardware vendors may
have SAP Certified server hardware which might fit your requirement with little customization. Involve your hardware vendor completely in
creating the infrastructure for you.
Now you have all 3 entities ready, SAP ERP Software (licenses & Media), SAP ERP Implementation Partner, and Hardware for SAP.
Lets now have a look at the next post to understand how thing work in SAP World.

SAP Tutorial - The Building Blocks

SAP Architecture
To be understood by you clearly, I have kept it simple. SAP has got three-tier architecture, as described below:

Presentation

Application
Database Layer

Layer
Layer

Presentation Layer This is where you will be every day while working in SAP. It may be a desktop based graphical user interface or a web
based UI. No Matter what the form, its work is to get you connected to the Application Layer and through that to underlying Database Layer.
Application Layer These are programs which perform specific tasks or operations and are grouped together in the component area (eg
Material Management, Sales and Distribution). It contains applications delivered by SAP AG as well as any Customized Program developed
by your implementation Partner.
Database Layer This is where the data is stored in form of table records. It is a relational database of your choice. SAP gives you freedom
to
choose
the
database
platform.
Having described the SAP Architecture in a nutshell, now let us proceed towards doing the First Highly Critical Task of mapping the
organization in SAP. This is a very crucial activity and it should be completed as soon as possible. Basically you are creating your businesss
organization structure from business process perspective. Each organization which is mapped in SAP is referred to by its ORGANISATION
STRUCTURE IN SAP.
This is the most basic Building Block on which you will later build and map all your business processes. Each Organization Structure
(whether in real life or in SAP) has got certain basic Elements, so what we are required to do here is map the businesss building blocks into
SAP at a higher level. Lets go into detail with help of some examples.
In Business you have a company (having its registration number) for which you create Profit & Loss Statement and Draw a Balance Sheet at
the end of Financial Year. So the company is a building block on the very top. Under this company you may have a Sales Department,
Purchase Department, Production Department, and Accounts Department. Let us drill down further into Sales Department and may be you
have different Channels of Sales, Different Brands which you manufacture or sell, and in order to reach your customer you have created a
hierarchy of elements like a Sales Depot, A Sales Office, A Salesman etc. All of these are elements in your organisations business process
map. Now if you are asked to create an organization structure for mapping in SAP, be overly cautious and described your organization in as
much detail as possible from process perspective. It will help the consultants in drawing up an Organization Structure for you in SAP. Some of
the elements used in SAP Organisation Structure are given below for your reference.

Organisation Structure in SAP

Some of key elements within SAP Organization Structure are listed below, please remember this is not an exhaustive list, it represents the
most basic and required elements only.

Client A Legally and organizationally independent Unit. This is the top most entity in SAP at which data can be recorded. It is a
partition of data in database so you can multiple instances of same tables belonging to different Clients. When SAP is installed, 3 clients are
created in the database by default, these are 000, 001, and 066. These are client tables are populated by SAP with some basic configuration
data which can be copied and altered to suit the business needs. Client 000 contains basic configuration settings, Client 001 has got some
test data and Client 066 is used by SAP for early watch alerts of your systems.

Company The Group Company, if any, where consolidation of different legal units is done.
Company Code - Lowest Legal Entity for which accounting is done.
Business Area A Sub unit for which separate books of account may be needed
Profit Centres Used for generating Profit Reports.
Cost Centres - To record expenses in proper heads for reporting purpose
Sales Organization A hierarchical representation of your sales channels. In SAP, sales organization comprises of following subelements.
Distribution Channel The avenues of sales eg, Distribution, Retail, Export, Institutional etc. This is a mandatory
element.

Sales Division This is basically the classification of goods sold at top level, it could be a brand or it could be product
category, you have to choose carefully as the data entry in sales module and reporting will be dependent on this element. This too is a
mandatory element.

Sales Offices Optional Elements, primarily used for reporting. Use them if you have sales offices in different cities or
geographies.

Sales Groups Optional Element, here you can define different Group of Sales people, mainly used for reporting purpose.
Sales Area Grouping of Sales Organization, Distribution channel and Division in such a way that you can control which channel
can sell what. So it is basically a derived element which controls the type of sales that can be done a customer or a group of customers.
Plant It is an operational unit within the company, it can be a manufacturing unit or it can be a warehouse.
Storage Locations Logical Partitions within the plant where you can store materials. A plant can have multiple Storage
Locations.
Purchasing Organization it is a basic element which records all purchase transactions within SAP, a purchase organisation can
cater to multiple sales organisations within the company. For example you have 2 very distinct lines of sales businesses, one sells consumer
products and the other sells cars, both of these sales lines belong to the same company and you have only one purchasing department which
buys raw material as well as finished goods for both of these sales lines so in sap you will have one purchase organisation. Purchase
organisation can be mapped to a client, or to plant or it could be a cross company entity
Purchasing Group Key for a buyer or a group of buyers, who is/are responsible for certain purchasing activities. You
can use it internally as the group responsible for the procurement of a material or a class of materials or if used externally, it is the medium
through which contacts with the vendor are maintained.
We are now finished with describing the Building Blocks. In the Next Session I will give you example from one of my implementations.

SAP Tutorial - The First Step

Organization Structure - Illustration

As promised yesterday, here is the sample organization Structure

Lets have a closer look at this. As you can see, we have created at the top a Client numbered 777, this is the first thing that user's will be
asked when accessing SAP (i.e., in which client they want to work). Right now there is no other client only one called 777, SF Corp. Ltd.

There are 4 Accounting related Areas defined on top, Controlling Area, Chart of Accounts, Chart of Depreciation, and Credit Control Area. All
of these are assigned to a company code called 1000 (again SF Corp Ltd.). SF Corp Ltd has only one Purchasing Organization and 3
purchasing groups, it has got 3 physical locations where it stores materials and that is why we created 3 plants numbered 1000,2000, and
3000. Each of these physical locations have logical partitions of materials so we created Storage Locations in each of these plants called
FG00 for Manufactured Goods, RM00 for all Raw Materials, and MA00 for Traded Finished Goods. We also created 3 Shipping Points from
which sales dispatches take place, one for each plant.
There is a Sales Area Defined for Company Code 1000, which comprises of Sales Organization Number 1000, Distribution Channel Number
10, and Division Number 10. SF Corp Ltd has got sales offices in 3 Metro Cities hence creation of 3 sales offices and 3 Sales Groups was
done. In current Chart you see we have only one Sales Area. If SF Corp was selling their goods thru different sales channels then we would
have created multiple Distribution Channels and if they had more than one product line and if their reporting needed was to have product line
was reports, then may be we would have created more divisions. Currently they have only one product line which is one brand of plastic
bottles in different shapes and sizes. They cater to the market using their dealers network spread across country.
I gave you a sample Org Structure on the this page. There are many more things that I could have included but didn't, purely for the sake of
simplicity. At this stage I want to keep things as simple as possible so that you are not confused and we can get long at a faster pace for
learning SAP. From this moment onwards, this blog will take 2 major directions. On one hand I will try to teach you about basic configuration
and the other will be helping you in the day-to-day operations.
We already know that there are many components within SAP viz. FI, SD, PP, MM, QM, HR etc. We will focus on 4 core areas of operations
viz FI (which includes Accounts Receivable - AR, Accounts Payable - AP, Asset Management - AA, CO- Controlling, PA - Profitability
Analysis), SD (Which include Sales Order Processing), PP (Entire Production Planning and Controlling), MM (Materials Management).You
also know that these components are tightly integrated in such a way that data posted into 1 module may get updated in corresponding
module automatically, without any need to re-enter that.

SAP Tutorial - Basic Configuration

As promised here are some screenshots from the customization.

To start SAP Customization you can follow the menu path as shown in the image below

or you can type the Transaction Code SPRO in the command field at the top left corner of the screen. The Customizing Menu (also called the
IMG - Impementation Guide) looks like the image below:

You can click on the clock icon in front of any menu item to start that part of customization. We will click the "Edit, Copy, Delete, Check
Company Code" menu item (shown in picture below)

Once you click it, a new pop up window appears as below

Now you have to double click on Edit Company Code Data. Another window will appear containing already defined company codes
(remember I had told you that SAP gives you some configuration settings along with some master data). Have a look at the screen below.

You can see a buttons toolbar and a table containing Company Codes and Company Names. You can select any row in this table and click
the Details button (or press Ctrl-Shift-F2) to see details about that row. See the screen below

We had selected Company Code 1000, SF Corp Limited, and then we clicked Details button, now we see the details of that row. Here we can
see that SF CORP LTD is in DELHI and Country is IN for India, Primary Currency is INR and Primary Language is EN - English.
For many customizing screens, direct jump codes or commands are available and you don't have to open the IMG to access those screens,
but for some there are not short codes, commands and you have to open IMG to access them.
I hope by now, you have got some idea about SAP and its configuration. My goal is to teach you both parts of SAP (Use and Operations,
Configuration and Customization). From next session onwards the focus will be diverted on Core Business Components (eg. FI, SD, PP, MM)
and you will be able to choose your area of interest for further learning.
My Advice to you at this point of time, learn and master any one of the core modules. Do not attempt to learn everything as that may be highly
confusing and less productive.

SAP Sales & Distribution for End Users - Part 1

SAP Sales and Distribution for End Users - Part 1

In this section we will describe the routine tasks followed / performed in Sales and Distribution Component of SAP.
Before we proceed into Sales and Distribution, let me give you some idea about the SAP Graphical User Interface (GUI).
SAP GUI is a program which you are required to install on desktop / laptops in order to be able to access SAP ERP systems.
Once installed, the shortcut to SAP GUI look is like the image below:

When you start the program by double clicking this shortcut you may get to see a windows as shown below:

You can see that there are 4 SAP Server Connections already defined in the window above. As discussed earlier, the general SAP
Landscape consists of 4 Servers and connection to all 4 servers is defined in this. You can log in into any or all of these servers as per your
requirement (all at the same time too).
When you double click any connection, the SAP Logon Screen appears as below, and you are required to choose the Client Number, your
username, and password. Your Username and Password will be assigned by your System Administrator.

after entering the required details simply press enter and you will get inside SAP System's Menu. The menu that appears after successful log
on depends on the your Role assigned to you by your SAP System Administrator. A Typical SAP Menu looks like the screen below:

On these Pages we will be describing only SAP SALES related activities, so let me show you how a typical SAP SALES MENU looks like.

Please note the Menu Header text which says "SAP Easy Access Sales" and now the SAP Menu contains items related to Sales module. All
other menu items are no more visible.
This means the menu is customizable and your SAP System Administrator (or you yourself) can change the way your normal SAP Menu

appears every time you log in.

In the next post I will describe various parts of this screen and then we will move forward on SAP Sales and Distribution Learning Path.

SAP Tutorial - The SAP Menu Screen Explained

On this page I will tell you about various parts of the SAP Menu and icons, which you saw in previous post.Z36SC4BPJV4E

There are 5 areas of concern visible in this screen.

1.
2.
3.
4.
5.

path.

The menu on top which says Menu, Edit, Favorites ....

The Command Bar, this is where you can type a short code to execute a sap program, if you don't want to follow the menu tree

Next to that are small icons forming up the Standard Toolbar.

The Title Bar
The Application Toolbar
There is a status bar also at the bottom of screen which is not visible in this screen, I will show you that in next post.

SAP Tutorial - The SAP Menu Screen Explained Part 2

On this page I will show you the Status Bar of a SAP Screen and explain about various things on the status bar.

SAP Status Bar

I wanted to show you this area of SAP Screen for 3 things:

1. It can tell you about currently running T-CODE, Program Name, or SAP System Name along with Client Number
2. It can give you a good idea about the time taken to complete a task in SAP
3. It tells you whether you are in INSERT mode or OVERWRITE MODE.
This small Pop up appears when you click the small icon next to where SESSION MANAGER is written on the current screen.
As described on my old posts, you can create your favorite list of frequently used programs / t-codes and that can be your default menu. Have
a look at the below screen. It displays my favorite transactions menu.

SAP Favorites Menu Folders

As you can see I have many favorite folders Starting with Year End and ending with Basis. I have multiple sub-folders / sub menus and
transactions within these menus / folders. have a look at the screen below:

SAP Favorites Menu - Expanded View

Now it will be clear to you that SAP Menu is like a Windows Explorer tree structure where you have folders and within those folder you can
organize sub folders / transactions.

SAP Sales & Distribution for End Users - Part 2

SAP Sales & Distribution for End Users - Part 2

The Sales and Distribution in SAP from end user's perspective has got 2 parts mainly.
1. Master Data
2. Order Processing

1. Master Data
SAP is a Master Data Driven System. Master Data Under Sales and Distribution module comprises of 2 major things:
A. Customers Related Master Data
B. Other Related Master Data such as Materials, Pricing, Taxes etc.

Customer Related Master Data is the central point of control for following 4 activities in SAP.
Sold to Party
Bill to Party
Ship to Party
Payer Party
These are also called partner functions in SAP. Apart from these there are certain more customer master records such as One Time
Customer, Inter Company Customer, Plants etc.
To Create a Customer Master Record one has to follow the SAP Menu as shown in below screen or you can directly type XD01 or VD01 (as
the case may be) in the command field on the top left corner of SAP Screen.

When you select VD01 - Sales and Distribution, the system presents you with input screens where you can define sales related master data
of a customer. When you select XD01 - Complete the system gives you option to define the company code related master data of a customer.
The difference between these 2 is that in VD01 you can define a customer master from Sales Perspective only whereas in XD01 you have
the complete master data creation capabilities including defining accounting links.
I will first show you 3 screens which appear after you choose VD01
On the first screen you are required to enter Customer Code (if your system is configured to generate it automatically then this may not be
needed), have a look below:

Here you enter the 5 key elements related to Customer Master Record.
Account Group - as mentioned above.
Customer Code
and 3 elements related to Sales Area discussed earlier in this tutorial.
when you click the Ok Button (Tick Mark Button) or press Enter, you get to see the first view of customer master which is called GENERAL
DATA. Look at the screen below:

On this page you have multiple tabs where you can fill required information and then click the SALES AREA DATA button (see the red
outlined button in the image above). Now you will see the second view of the same customer master record as shown below:

As you can see, SAP gives you multiple tabs on this screen as well.

SAP Sales & Distribution for End Users - Part 3

SAP Customer Master Data - Continued

Lets continue exploring the Tabs available on Customer Master Screens and If time permits, I will also tell you about the third and important
view of customer master which is Company Code Data.
The different tabs available on General data screen are:
Address
Control Data
Marketing
Unloading Points
Export Data
and
Contact Person
Address Tab is self explanatory so I will skip that. Control Data tab is used when you want to establish a link between your customer and
vendor. You may have customer who is also a vendor to your organization, using this tab you will be able to link a vendor code to a customer
code. Apart from that you can also specify your customer's tax related details on this page.
All other tabs can be used to record general data related to the customer.
Remember General Data is common for all the Sales Areas assigned to a Customer Code.
Please go thru the screenshots below and let me know if you have any questions related to any General Data Tab.

With these screenshots I finish the General Data Description. In the next session I will show you the screens related to Sales Area Data and
what all can be entered there.
The Most Important point to remember is that all information entered on these tabs is common for all the sales areas of a customer. Sales
Area, if you recall, is nothing but a combination of Distribution Channel and Sales Division. You can assign any number of sales areas to a
Customer Master Record as per your business needs.

Folks

SAP Sales & Distribution for End Users - Part 4

am

Back

after

long

hiatus!!!!

Here is the long overdue Part 4 of the continuing series which gives you a brief glimpse of the SAP Sales Area Data Screens:

The SAP Sales Area in a customer Master has got several tabs. The screenshot above depicts a typical customer master's SALES TAB
under Sales Area. Using fields in this tab, one can define the sales order processing related values and pricing techniques to be used while
preparing
the
sales
document.
The next tab is called Shipping and here we define the field values for controlling the shipping related activities.

Now we come to the Billing Tab which controls (among other things) the taxes to be applied while preparing the sales order. Remember these
settings are master data and hence should not be changed unless there is a very specific and pressing business reason. Using this tab we

also establish a link to Financial Accounting Postings as to the revenue generated from sales to this customer will appear under which Ledger
Account.

And finally we come to Partner Function tab in which we specify link to other customer masters for specific reasons. In business often time
we
come
across
scenarios
such
as;
for
an
invoice
generated
from
the
system:
1.
Billing
can
be
done
to
a
separate
customer
address
2.
Shipping
can
be
done
to
separate
customer
address
3.
Sold
to
party
can
be
someone
else
and
4.
Payment
may
be
made
by
someone
else.
SAP

provides

various

partner

functions

which

can

be

listed

to

solve

the

problem

stated

above.

Hope this session on Sales Area Tabs gave you some knowledge. We will take up the last section of customer master called Company Code
data in the next post. Bye till then...