SAP History

Thursday, May 29, 2008

SAP was founded in 1972 as Systemanalyse und Programmentwicklung[2] by five former IBM engineers in Mannheim, Baden-Württemberg (Dietmar Hopp, Hans-Werner Hector, Hasso Plattner, Klaus Tschira, and Claus Wellenreuther).As part of the Xerox exit strategy from the computer industry, Xerox retained IBM to migrate their business systems to IBM technology. As part of IBM's compensation for the migration, IBM acquired the SDS/SAPE software, reputedly for a contract credit of $80,000. The SAPE software was given by IBM to the founding ex-IBM employees in exchange for founding stock provided to IBM, reputedly 8%. It may be noted that, at the time they left IBM, the ex-employees were quite senior engineers in IBM Germany rather than founding engineers in the sense of Hewlett-Packard's founders.The acronym was later changed to stand for Systeme, Anwendungen und Produkte in der Datenverarbeitung ("Systems, Applications and Products in Data Processing").

In 1976 "SAP GmbH" was founded and the following year it moved headquarters to Walldorf. SAP AG became the company's official name after the 2005 annual general meeting (AG is short for Aktiengesellschaft).

In August 1988, SAP GmbH transferred into SAP AG (a corporation by German law), and public trading started November 4. Shares are listed on the Frankfurt and Stuttgart stock exchange.[3]

The founding members Dietmar Hopp, Hasso Plattner, Klaus E. Tschira and Hans-Werner Hector form the executive board. In 1995, SAP was included in the German stock index DAX. On September 22, 2003, SAP was included in the Dow Jones STOXX 50.[4] In 1991, Prof. Dr. Henning Kagermann joined the board; Dr. Peter Zencke became a board member in 1993.[5] Claus Heinrich,[6] and Gerhard Oswald [7] have been members of the SAP Executive Board since 1996. Two years later, in 1998, the first change at the helm took place. Dietmar Hopp and Klaus Tschira moved to the supervisory board and Dietmar Hopp was appointed Chairman of the supervisory board. Henning Kagermann was appointed as Co-Chairman and CEO of SAP next to Hasso Plattner. Werner Brandt joined SAP in 2001 as a member of the SAP Executive Board and Chief Financial Officer.[8] Léo Apotheker has been a member of the SAP Executive Board and president of Global Customer Solutions & Operations since 2002, was appointed Deputy CEO in 2007, and then became co-CEO alongside Kagermann in 2008.

Henning Kagermann became the sole CEO of SAP in 2003.[9] In February 2007 his contract was extended until 2009. After continuous disputes over the responsibility of the development organization, Shai Agassi, a member of the executive board who had been named as a potential successor to Kagermann, left the organization.[10]

Milestones technical solutions

In 1972 the SAP R/1 solution was launched.[11] Seven years later, in 1979, SAP launched SAP R/2.[11] In 1981, SAP brought a completely re-designed solution to market. With the change from R/2 to R/3 in 1992, SAP followed the trend from mainframe computing to client-/server architectures. The development of SAP’s Internet strategy with mySAP.com redesigned the concept of business processes (integration via Internet).[3] SAP is awarded Industry Week’s Best Managed Companies in 1999.[12]

In 2003 launched its technology platform SAP NetWeaver, followed by the announcement in 2005 of the development of a Business Process Platform.[11]

Business and markets

SAP is the world's largest business software company and the third-largest independent software provider in terms of revenues.[13] It operates in three geographic regions – EMEA, which represents Europe, Middle East and Africa; the Americas (SAP America, headquartered in Newtown Square, Pennsylvania), which represents both North America and Latin America; and Asia Pacific Japan (APJ), which represents Japan, Australia and parts of Asia. In addition, SAP operates a network of 115 subsidiaries, and has R&D facilities around the globe in Germany, North America, Canada, China, Hungary, India, Israel and Bulgaria.

SAP focuses on six industry sectors: process industries, discrete industries, consumer industries, service industries, financial services, and public services.[14] It offers more than 25 industry solution portfolios for large enterprises[15] and more than 550 micro-vertical solutions for midsize companies and small businesses.[16]

[edit] Products

SAP's products focus on Enterprise Resource Planning (ERP), which it helped to pioneer. The company's main product is SAP ERP. The name of its predecessor SAP R/3 hints at its functionality: the "R" stands for realtime (even though it is not a realtime solution), the number 3 relates to a 3-tier architecture: database, application server and client (SAPgui). R/2, which ran on a Mainframe architecture, was the first SAP version.

SAP ERP is one of five major enterprise applications in SAP's Business Suite. The other four applications are:

* customer relationship management (CRM) - helps companies acquire and retain customers, gain deep marketing and customer insight, and align organization on customer-focused strategies
* product lifecycle management (PLM) - helps manufacturers with a single source of all product-related information necessary for collaborating with business partners and supporting product lines
* supply chain management (SCM) - helps companies enhance operational flexibility across global enterprises and provide real-time visibility for customers and suppliers
* supplier relationship management (SRM) - customers can collaborate closely with suppliers and integrate sourcing processes with applications throughout the enterprise to enhance transparency and lower costs

Other major product offerings include: the NetWeaver platform, Governance, Risk and Compliance (GRC) solutions, Duet (joint offering with Microsoft), Performance Management solutions and RFID. SAP offers a systematic approach to enterprise SOA, which is the technical standard that enables various enterprise software applications to exchange data effectively. Through enterprise SOA, SAP is focusing on enabling more flexible business processes as well as creating technical connections between IT systems and building a common language for business.

While its original products were typically used by Fortune 500 companies, SAP is now also actively targeting small and medium sized enterprises (SME) with its SAP Business One and SAP Business All-in-One. On September 19th, 2007 SAP announced a new product named SAP Business ByDesign complementing its portfolio for SME. SAP Business ByDesign was known under the code name "A1S" before.[17]

SAP officials say there are over 100,600 SAP installations serving more than 41,200 companies in more than 25 industries in more than 120 countries.[18]

Partnerships

Partnerships are core to SAP’s strategy and in its 35 years of history the network of software solution providers, value-added resellers, distributors, technology and services partners has developed into a broad ecosystem that is among the industry's largest.[19] Opened in June 2007, the SAP Co-Innovation Lab in Palo Alto, Calif. provides an efficient work environment for joint projects with independent software vendors (ISVs), such as Novell, Questra and Wonderware, system integrators (SIs) and technology partners to work together with SAP around current and future technologies. Co-founded by Cisco, Hewlett-Packard, Intel and NetApp, the lab offers a hands-on environment and real-world performance for Web-enabled and Internet/intranet-accessible business applications based on Enterprise SOA.[20]

SAP partners include Global Services Partners with cross-industry multinational consulting capabilities,[21] Global Software Partners providing integrated products that compliment SAP Business Suite solutions,[22] and Global Technology Partners providing user companies with a wide range of products to support SAP technology, including vendors of hardware, database, storage systems, networks, and mobile computing technology.[23]

SAP partners with Protiviti, Hewlett-Packard, Siemens IT Solutions and Services and Accenture. Among other services there are assessment, government and architecture for R3.[citation needed]

[edit] SAP PartnerEdge

SAP solutions for small businesses and midsize companies are delivered through its global partner network. In 2008, SAP signed SAP Global Service partnership with HCL Technologies, a $4.9 b technology service provider, headquartered in India.[24]. The SAP PartnerEdge program, SAP's partner program, offers a set of business enablement resources and program benefits to help partners including value added resellers (VARs) and independent software vendors (ISVs) be profitable and successful in implementing, selling, marketing, developing and delivering SAP solutions to a broad range of customers.[25]

Gartner states that SAP PartnerEdge has "set a new standard for innovation in channel development for the small and midsize business application market."[citation needed]

Communities

SAP Developer Network (SDN) is a community of developers, consultants, integrators, and business analysts gaining and sharing knowledge about ABAP, Java, .NET, SOA, and other technologies via expert blogs, discussion forums, exclusive downloads and code samples, training materials, and a technical library.[26] The Business Process Expert (BPX) Community is a collaborative environment for business process experts to share information, experiences and best practices to leverage enterprise SOA in order to increase business agility and IT value.[27] The SAP Enterprise Services Community serves as a platform for members from customers, industry experts and partners working collaboratively to define enterprise services.[28] Industry Value Networks (IVN) bring together customers, partners and SAP to co-innovate and develop solutions to solve industry-specific customer challenges. There are currently eleven active IVNs (e.g. Banking, Chemicals, Consumer Products, High Tech, Public Sector, Retail).[29]

Organization

Functional units of SAP are split across different organizational units for R&D needs, field activities and customer support. SAP Labs are mainly responsible for product development where as the field organizations spread across each country are responsible for field activities such Sales, Marketing, Consulting etc. Head office located in SAP AG is responsible for overall management as well as core Engineering activities related to Product Development. SAP customer support, also called Active Global Support (AGS) is a global organization to provide support to SAP customers worldwide.

SAP Labs

SAP Labs are the research and development organizations of the parent company. SAP has its labs spread across the globe. Many, but not all, labs locations are hosting SAP Research groups.

Prominent labs are located in Palo Alto, USA; Bangalore and Gurgaon India; Ra'anana and Karmiel, Israel; Montreal and Shanghai, China. SAP Labs located in Bangalore is the largest development unit in terms of number of employees outside the SAP headquarters located in Walldorf, Germany.Other SAP Labs locations include France, Bulgaria and Hungary.

Each SAP Lab has prominent area of expertise and focus. SAP Labs in Sofia, Bulgaria for example specializes in development of Java based SAP software products. Whereas, SAP Labs in U.S. is famous for its focus on innovation and research. Then again, SAP Labs India contributes to all areas of the SAP product value chain- Research & Breakthrough Innovation, Product Development, Global Services & Support and Customer Solutions & Operations.

User groups

User groups are independent, not-for-profit organizations of SAP customer companies, partners, analysts, thought leaders, and SAP development teams that provide insight into market demand and are educating members, thus influencing SAP product releases and direction. Examples of user groups are Americas' SAP Users' Group ASUG,[30] the German SAP User Group (DSAG),[31] the SAP Australian User Group (SAUG)[32] and the SAP UK & Ireland User Group.[33][34]

Competitive landscape

SAP competitors are primarily in the Enterprise Resource Planning Software industry. SAP also competes in the Customer Relationship Management, Marketing & Sales Software, Manufacturing, Warehousing & Industrial Software, and Supply Chain Management & Logistics Software sectors.[35]

Oracle Corporation, SAP's major competitor, failed a case against SAP for malpractice and unfair competition in the Californian courts on 22nd March 2007. The complaint alleged that a Texas subsidiary, SAP TN (formerly TomorrowNow before purchase by SAP), which provides discount support for legacy Oracle product lines, used the accounts of former Oracle customers to systematically download patches and support documents from Oracle's website and appropriating them for SAP's use.[36][37]. Later SAP admitted wrong-doing on smaller scale than Oracle claimed in the Lawsuit.

SAP has admitted to inappropriate downloads however the company denies the theft of any intellectual property.[38]

SAP is known to grow organically as opposed to its main rival Oracle which has been spending US$20 billion since 2004 acquiring 30 smaller competitors. SAP was able to increase its annual profits by 370% since 2002.[39]

In something of a departure from its usual organic growth, on Oct 7, 2007, SAP announced that it will acquire Business Objects, the market leader in business intelligence software, for $6.8B.[40]

SAP Implementation

SAP Implementation
SAP Implementation is the whole of processes that defines a complete method to implement SAP software in an organization. The SAP implementation method described in this entry is a generic method and not a specific implementation method as such. It is based on best practices and case studies from various literature sources and presents a collection of processes and products that make up a complete implementation method to allow any organization to plan and execute the implementation of SAP (ERP) software.
Contents


* 1 Introduction
* 2 Overview
* 3 Table of concepts
* 4 Activity table
* 5 Implementation processes
o 5.1 Project preparation
o 5.2 Sizing and blueprinting
o 5.3 Functional development
o 5.4 Final preparation
o 5.5 Go Live
* 6 Critical success factors
* 7 See also
* 8 References

Introduction

The implementation of SAP software, such as SAP R/3 is almost always a massive operation that brings a lot of changes in the organization. The whole process can take up to several years. Virtually every person in the organization is involved, whether they are part of the SAP technical support organization (TSO) or the actual end-users of the SAP software. The resulting changes that the implementation of SAP generates are intended to reach high level goals, such as improved communication and increased return on information (as people will work with the same information). It is therefore very important that the implementation process is planned and executed with the usage of a solid method. There are various SAP implementation methods, such as IBM’s Ascendant. An example of how one company, Robert Bosch GmbH, implemented SAP R/3 over 10 years is available [1]. This study shows that designing IT architecture is very critical in SAP implementation practices.

Overview
Figure 1: SAP Implementation process-data diagram
Figure 1: SAP Implementation process-data diagram

The SAP implementation process is made up out of four main phases, i.e. the project preparation where a vision of the future-state of the SAP solution is being created, a sizing and blueprinting phase where the solution stack is created and training is being performed, a functional development phase and finally a final preparation phase, when the last tests are being performed before the actual go live. For each phase, the vital activities are addressed and the deliverables/products are explained.

The process-data diagram that is depicted at the right, gives an overview of all of these activities/processes and deliverables. The four gray boxes depict the four main implementation phases, which each contain several processes that are in this case all sequential. The boxes at the right show all the deliverables/concepts that result from the processes. Boxes without a shadow have no further sub-concepts. Boxes with a black shadow depict complex closed concepts, so concepts that have sub-concepts, which however will not be described in any more detail. Boxes with a white shadow (a box behind it) depict open closed concepts, where the sub-concepts are expanded in greater detail. The lines with diamonds show a has-a relationship between concepts.

Many of implementations are also done with ASAP(Accelerated SAP) methodolgy evolved from best practises in SAP.

Table of concepts

The data table below provides a summary of all the concepts addressed in the process-data diagram.
Concept Definition
CHANGE MANAGEMENT ***Activities involved in (1) defining and installing new values, attitudes, norms, and behaviors within an organization that support new ways of doing work and overcome resistance to change; (2) building consensus among customers and stakeholders on specific changes designed to better meet their needs; and (3) planning, testing, and implementing all aspects of the transition from one organizational structure or business process to another. (www.gao.gov)
CHANGE MANAGEMENT DOCUMENTATION All documentation that is required and being delivered whilst performing change management, e.g. the functional test cases and all the other documents a new end-user of SAP requires and the various tools and approaches used to manage change by the TSO. (Anderson, 2003)
COST OF OWNERSHIP ANALYSIS Determination of where and when the costs are inquired within the context of the SAP solution stack and ongoing operations. The analysis addresses all internal and external costs, both one-time as well as recurring (Anderson, 2003)
CUTOVER The process of transitioning from one system to a new one (Anderson, 2003)
CUTOVER PLAN All documentation related to planning, preparing and executing cutover, describing how to lock down the system from a technical change management perspective, preparing the TSO for its new role and rolling out the SAP graphical user interface to all future end users. (Anderson, 2003)
DATA CENTER A data center is a facility used for housing a large amount of electronic equipment, typically computers and communications equipment. (www.wikipedia.org)
DATA CENTER REQUIREMENT A requirement for the SAP data center, i.e. a physical requirement like power requirements, a rack requirement, a network infrastructure requirement or a requirement to the network server. (Anderson, 2003)
DISASTER RECOVERY (DR) REQUIREMENT Requirement that focuses on downtime that lasts many hours to days or even weeks (Anderson, 2003)
FUNCTIONAL TEST CASE A set of conditions or variables under which a tester will determine if a certain business process works (www.wikipedia.org)
HIGH AVAILABILITY (HA) REQUIREMENT Requirements that describes the amount of time that the system needs to be available to satisfy the needs of the users. (Anderson, 2003)
INSTALLATION DOCUMENTATION All documentation related to the installation of an end-to-end SAP solution (Anderson, 2003)
OPERATIONS MANUAL The collection of current state system documentation, day-to-day and other regularly scheduled operations tasks, various installation and operations checklists and how-to process documents. (Anderson, 2003)
SAP SAP AG is the name of the biggest European software company. The head office is in Walldorf, Germany. SAP was founded in 1972 as Systemanalyse und Programmentwicklung ("Systems Analysis and Product") by five former IBM employees in Mannheim, Germany. (www.wikipedia.org)
SAP IMPLEMENTATION PROJECT PLAN A comprehensive project plan that contains all products that are delivered whilst performing an SAP implementation project (Anderson, 2003)
SOLUTION STACK Set of software subsystems or components needed to deliver a fully functional solution, e.g. a product or service. (www.wikipedia.org)
SOLUTION STACK PARTNERS LIST A list of all vendors that deliver the products that make up the SAP solution stack (Anderson, 2003)
SOLUTION VISION A vision of the future-state of the SAP solution (Anderson, 2003)
STRESS TEST PLAN A test plan that is focused at determining the stability of a given system or entity. It involves testing beyond normal operational capacity, often to a breaking point, in order to observe the results. (www.wikipedia.org)
TEST PLAN A detail of how the test will proceed, who will do the testing, what will be tested, in how much time the test will take place, and to what quality level the test will be performed. (IEEE 829)
TRAINING The acquisition of knowledge, skills, and attitudes as a result of the teaching of vocational or practical skills and knowledge that relates to specific useful skills (www.wikipedia.org)
TRAINING PLAN Consisting of training units, a training plan is the result of hierarchical decompositions of a training goal, tailored according to the learning preferences and prior knowledge of the trainee. A plan is the means by which the trainee satisfies the goal. (www.ece.eps.hw.ac.uk/)
TSO Technical Support Organization. The people that are committed to implementation and management of SAP. (Anderson, 2003)
TSO CHART A chart that depicts the structure of the TSO. (Anderson, 2003)

Activity table

The following table provides a summary of all of the activities that form the SAP implementation process. These activities will be described with more detail and elaborated with examples in the rest of this entry.
Activity Sub-Activity Description
Project preparation Craft solution vision Refine and communicate a SOLUTION VISION of the future-state of the SAP solution, to sketch a design that meets both business and financial requirements. The focus should be on the company’s core business and how the SAP solution will better enable that core business to be successful.
Design and initially staff the SAP TSO Design and staff the key positions of the SAP Technical Support Organization (TSO), the organization that is charged with addressing, designing, implementing and supporting the SAP solution.
Sizing and blueprinting Perform cost of ownership analysis Perform a COST OF OWNERSHIP ANALYSIS to determine how to get the best business solution for the least money i.e. to determine where and when the costs are incurred within the context of the SAP solution stack.
Identify high availability and disaster recovery requirements Determine all HIGH AVAILABILITY and DISASTER RECOVERY REQUIREMENTS, to plan what to do with later downtime of the SAP system
Engage SAP solution stack vendors Select the best SAP hardware and software technology partners for all layers and components of the SAP SOLUTION STACK, based on a side-by-side sizing comparison
Staff TSO Staff the bulk of the TSO, i.e. fill the positions that directly support the near-term objectives of the implementation, which are to develop and begin installation/implementation of the SAP data center.
Execute training Train the various members of the SAP TSO, like data center specialists, high availability specialist and network specialists and train the end-users to give all the required SAP knowledge and skills
Setup SAP DATA CENTER Build a new SAP DATA CENTER facility or transform the current data center into a foundation capable of supporting the SAP SOLUTION STACK
Perform installations Install the (My)SAP components and technological foundations like a web application server or enterprise portal.
Round out support for SAP Identify and staff the remaining TSO roles, e.g. roles that relate to help desk work and other such support providing work.
SAP functional development Address Change Management Develop a planned approach to the changes in the organization. The objective is to maximize the collective efforts of all people involved in the change and minimize the risk of failure of implementing the changes related to the SAP implementation.
Address SAP systems and operations management Create a foundation for the SAP systems management and SAP computer operations, by creating a SAP OPERATIONS MANUAL and by evaluating SAP management applications.
Perform functional, integration and regression tests Test the SAP business processes, by executing functional tests to ensure that business processes work, integration tests to ensure that the organization’s business processes work together with other business processes and regression tests to prove that a specific set of data and processes yield consistent and repeatable results.
Final Preparation Perform systems and stress tests Plan, script, execute and monitor SAP STRESS TESTS, to see if the expectations of the end users, defined in service level agreements, will be met.
Prepare for cutover Plan, prepare and execute the CUTOVER, by creating a CUTOVER PLAN that describes all cutover tasks that have to be performed before the actual go-live
Go Live Turn on the SAP system for the end-users

Implementation processes

preparation

The project preparation phase, depicted below, focuses at two main activities, i.e. to make a setup for the TSO and to define a solution vision. These activities allow an organization to put in on the right track towards implementation.
Figure 2: Project preparation phase
Figure 2: Project preparation phase

Design and initially staff the SAP TSO


The first major step of the project preparation phase is to design and initially staff an SAP technical support organization (TSO), which is the organization that is charged with addressing, designing, implementing and supporting the SAP solution. This can be programmers, project management, database administrators, test teams, etc. At this point, the focus should be at staffing the key positions of the TSO, e.g. the high-level project team and SAP professionals like the senior database administrator and the solution architect. Next to that, this is the time to make decisions about choosing for internal staff members or external consultants.

The image at the right shows a typical TSO chart.

Craft solution vision

The second project preparation job is to define a so-called solution vision, i.e. a vision of the future-state of the SAP solution, where it is important to address both business and financial requirements (budgets). The main focus within the vision should be on the company’s core business and how the SAP solution will better enable that core business to be successful. Next to that, the shortcomings of the current systems should be described and short but clear requirements should be provided regarding availability (uptime), security, manageability and scalability of the SAP system.

Sizing and blueprinting

The next phase is often referred to as the sizing and blueprinting phase and forms the main chunk of the implementation process. The phase is illustrated below.

Perform cost of ownership analysis

This phase starts with performing a total cost of ownership analysis (TCO analysis) to determine how to get the best business solution at the lowest costs. This means to compare SAP solution stack options and alternatives and then determine what costs each part of the stack will bring and when these costs will be incurred. Parts of the stack are for example the hardware, operating system and database, which form the acquisition costs. Next to that, there should be taken a look at recurring costs like maintenance costs and downtime costs. Instead of performing a complete TCO analysis for various solution stack alternatives that would like to compare, it can be wise just to do a so-called delta analysis, where only the differences between solutions (stacks) are identified and analyzed. The image at the right depicts the essence of a delta analysis.

Identify high availability and disaster recovery requirements

The next step is identifying the high availability requirements and the more serious disaster recovery requirements. This is to plan what to do with later downtime of the SAP system, caused by e.g. hardware failures, application failures or power outages. It should be noted that it is very important to calculate the cost of downtime, so that an organization has a good idea of its actual availability requirements.

Engage SAP solution stack vendors

A true sizing process is to engage the SAP solution stack vendors, which is the next step. This means selecting the best SAP hardware and software technology partners for all layers and components of the solution stack, based on a side-by-side sizing comparison. The most important factors that are of influence here are the estimated numbers of (concurrent) users and batch sizes. A wise thing to do is to involve SAP AG itself to let them create a sizing proposal stating the advised solution stack, before moving to SAP’s technology partners/SAP vendors, like HP, Sun Microsystems and IBM. A simplified solution stack is depicted at the right, showing the many layers for which software and hardware has to be acquired. Note the overlap with the OSI model.

Staff TSO

The TSO is the most important resource for an organization that is implementing SAP, so staffing the TSO is a vital job which can consume a lot of time. In a previous phase, the organization should already have staffed the most vital positions. At this point the organization should staff the bulk of the TSO, i.e. fill the positions that directly support the near-term objectives of the implementation, which are to develop and begin the installation/implementation of the SAP data center. Examples are: data center experts, network infrastructure experts, security specialists and database administration experts.

There are many ways to find the right people within or outside the organization for all of the TSO positions and it depends on the organization how much time it wants to spend on staffing.

Training

One of the most vital stages of the implementation process is training. Very few people within an organization are SAP experts or even have worked with SAP software. It is therefore very important to train the end users but especially the SAP TSO: the people who design and implement the solution. Many people within the TSO need all kinds of training. Some examples of these positions:

* SAP Network Specialists
* SAP Database Administrators
* SAP Security specialists
* Documentation specialists
* Et cetera

All of these people need to acquire the required SAP knowledge and skills or even SAP certifications through training. Moreover, people need to learn to do business in a totally new way. To define how much SAP training every person needs, a company can make use of a skillset matrix. With this matrix, a manager can identify who possesses what knowledge, to manage and plan training, by defining the height of expertise with a number between e.g. 1 and 4 for each skill for each employee.

Setup SAP data center

The next step is to set up the SAP data center. This means either building a new data center facility or transforming the current data center into a foundation capable of supporting the SAP solution stack, i.e. all of the technology layers and components (SAP software products) in a productive SAP installation. The most important factor when designing the data center is availability. The high availability and disaster recovery requirements which should have been defined earlier, give a good idea of the required data center requirements to host the SAP software. Data center requirements can be a:

* Physical requirement like power requirements
* Rack requirement
* Network infrastructure requirement or
* Requirement to the network server.

Perform installations

The following step is to install the required SAP software parts which are called components and technological foundations like a web application server or enterprise portals, to a state ready for business process configuration. The most vital sub steps are to prepare your OS, prepare the database server and then start installing SAP software. Here it is very important to use installation guides, which are published for each SAP component or technology solution by SAP AG. Examples of SAP components are:

* R/3 Enterprise — Transaction Processing
* mySAP BI — Business Information Warehouse
* mySAP CRM — Customer Relationship Management
* mySAP KW — Knowledge Warehouse
* mySAP PLM — Product Lifecycle Management
* mySAP SCM — Supply Chain Management
* mySAP SEM — Strategic Enterprise Management
* mySAP SRM — Supplier Relationship Management

Round out support for SAP

Before moving into the functional development phase, the organization should identify and staff the remaining TSO roles, e.g. roles that relate to helpdesk work and other such support providing work.

Functional development

The next phase is the functional development phase, where it is all about change management and testing. This phase is depicted below.

Address change management

The next challenge for an organization is all about change management / change control, which means to develop a planned approach to the changes the organization faces. The objective here is to maximize the collective efforts of all people involved in the change and to minimize the risk of failure of implementing the changes related to the SAP implementation.

The implementation of SAP software will most surely come with many changes and an organization can expect many natural reactions, i.e. denial, to these changes. To fight this, it is most important to create a solid project team dedicated to change management and to communicate the solution vision and goals of this team. This team should be prepared to handle the many change issues that come from various sources like:

* End-user requests
* Operations
* Data center team
* DBA group
* Systems management

SAP systems and operations management

Next thing is to create a foundation for the SAP systems management and SAP computer operations, by creating a SAP operations manual and by evaluating SAP management applications. The manual is a collection of current state system documentation, day-to-day and other regularly scheduled operations tasks, various installation and operations checklists and how-to process documents.

Functional, integration and regression testing

Testing is very important before going live with any system. Before going live with a SAP system, it is vital to do many different kinds of testing, since there is often a large, complex infrastructure of hardware and software involved. Both requirements as well as quality parameters are to be tested. Important types of testing are:

* Functional testing: to test using functional use cases, i.e. a set of conditions or variables under which a tester will determine if a certain business process works
* Integration testing
* Regression testing

All tests should be preceded by creating solid test plans.

Final preparation

The last phase before going live can be referred to as the final preparation phase and is depicted below.

Systems and stress testing

Another vital preparation activity before going live with SAP is systems and stress testing. This means planning, scripting, executing and monitoring system and stress tests, to see if the expectations of the end users, defined in service level agreements, will be met. This can be done with SAP’s standard application benchmarks, to benchmark the organization’s configurations against configurations that have been tested by SAP’s hardware technology partners. Again, a test plan should be created at first.

Prepare for cutover

The final phase before going live with SAP is often referred to as the cutover phase, which is the process of transitioning from one system to a new one. The organization needs to plan, prepare and execute the cutover, by creating a cutover plan that describes all cutover tasks that have to be performed before the actual go-live. Examples of cutover tasks are:

* Review and update all systems-related operations procedures like backup policies and system monitoring
* Assign ownership of SAP’s functional processes to individuals
* Let SAP AG do a GoingLive check, to get their blessing to go live with the system
* Lock down the system, i.e. do not make any more changes to the SAP system

Go Live

All of the previously described phases all lead towards this final moment: the go-live. Go-live means to turn on the SAP system for the end-users and to obtain feedback on the solution and to monitor the solution. It is also the moment where product software adoption comes into play. More information on this topic:

* Product Software Adoption: Big Bang Adoption
* Product Software Adoption: Parallel Adoption
* Product Software Adoption: Phased Adoption

success factors

In order to successfully implement SAP in an organization, there are several things that are of great importance. First it is very important to get the support from all the people that are involved in implementing SAP, but also the people that will actually use the SAP software. Second it is essential to create a solution vision at the beginning of the implementation track, so that everybody within the organization knows why SAP is being implemented. Third and last it is very important to test the SAP hardware and software rigorously and to ensure that the end-users are ready to use SAP before going live, because there are many known projects that failed because of a lack of support and SAP knowledge..