With mySAP ERP, SAP has created a solution for strategic and operational management of an organization that goes far beyond the traditional meaning of “enterprise resource planning.” Most enterprises that use mySAP ERP for decision making are midsize companies that need to differentiate themselves from their competitors and want to achieve distinctly more flexible business processes as well as operational excellence.
Few would be surprised to learn that these midsize companies see themselves as facing the same challenges that large enterprises do. Nonetheless, midsize companies operate within a completely different context because:
- They strive for extremely rapid ROI because their financial leeway is much more limited than that of large companies.
- They need investment reliability regarding the scalability and flexibility of the IT solution.
- They tend to have small IT teams, and business departments (like controlling and logistics) can provide only limited involvement in IT projects.
- They are cautiois regarding the costs of an IT project in order to minimize the related risks and potential impacts on cash flow
- They generally prefer predefined projects with a manageable scope and benefits.
To respond to these challenges, SAP developed a modular approach to mySAP ERP, its market-leading ERP solution. According to this approach, customers receive the complete functional scope of mySAP ERP, however, implemented in several small steps according to the specific customer requirements.
Basic package with an option to expand
The SAP ERP packaged solution is a basic ERP package for production industries and service companies. The package, which is built upon mySAP ERP, forms the foundation of SAP’s modular approach. It provides essential core scenarios from financial management and logistics – such as implementation of procure-to-pay and order-to-cash. It encompasses financial accounting, controlling (cost center accounting, profit center accounting, and profitability analysis), sales (order management and distribution), materials management (procurement), production planning and control (make-to-order, make-to-stock, or repetitive environments), and some areas of human resources. Companies can easily enhance this base solution with an enterprise portal or extended processes for human resources (recruiting or payroll).
Unlike other suppliers whose products require complete replacement of legacy systems in one fell swoop, SAP offers a step-by-step approach to implementation with mySAP ERP. Because mySAP ERP is powered by the SAP NetWeaver platform, companies can easily enhance it and protect their existing investments. The implementation approach is similar to that of computer suppliers that offer customers a basic computer with a specific processor and some service data at a predefined price. Customers determine if they want to add a CD reader or burner – once again at a predefined price.
In addition to the basic package for core ERP functionality, SAP also offers ERP-based Packaged Solutions that handle the special needs of a given industry, such as the SAP ERP Packaged Solutions for consumer products (e.g. food and beverage), industrial manufacturing or construction industries. The contents of the base package depend upon the customer’s requirements of the solution. A customer decides on the starting scope and determines which functionality will be needed in the future.
Implementation, consulting, and service
Pre-defined scope for a customer-specific overall business solution require a high level of expert knowledge about business processes and system configuration. At SAP, this expertise is bundled into the SAP Best Practices family of offerings, which contains the solution and industry knowledge of thousands of SAP customers and their implementation projects. SAP Best Practices provides detailed documentation, immediately accessible system configuration (customizing information), test data and catalogs, training materials, and end-user documentation for the scenarios, processes, and functionalities mapped with SAP Best Practices. This knowledge is the basis of every Packaged Solution.
In addition to process and industry knowledge, the Packaged Services offered by SAP Field Services or the respective implementation offerings of SAP partners are an essential part of Packaged Solutions. Customers know exactly the process and functional scope, the implementation time, and the cost of the package. The basic offerings of these special services in the context of Packaged Solutions are:
- Project management
- Delta requirements workshop
- Implementation of the predefined scope
- Technical installation of the solution
- Training of key users
- End-user documentation
- Predefines test catalog and entry sheets for data migration
- Support during the start of production
Beyond this basic offering and its corresponding implementation services, customers can order additional packaged services à la carte. These services help realize functional enhancements or simply provide services that are not provided with the basic package. For example, if customers want to enhance the base solution with industry-specific logistics functions, SAP NetWeaver Business Intelligence, or a payroll or portal solution, they can make their selections and implement them step-by-step with a predefined scope, price, and implementation time during the initial project or later on in a consecutive project phase. Additional services include solution hosting, project financing, end-user training, change management, customer-specific reports or interfaces, data archiving, or post-implementation support.
Three months to implement – savings of 60 percent
Avex Production was one of the first customers convinced of the modular concept. The Slovakian company produces electronic components and serves over 3,000 smaller customers in Europe, Asia, and the Americas. Avex needed key figures on the costs and efficiency of its production and real-time access to the most important financial key figures. Avex saw help in a completely integrated ERP solution with predefined scope, cost, and implementation schedule. The approach helped the company also to avoid disrupting its day-to-day business. After a project that lasted only three months with 60 percent lower costs than a traditional project would have incurred, the company went live with its solution in spring 2005.