SAP ERP: Understanding and Importance

SAP, a German company founded in 1972, is one of the world’s leading software developers for business, creating solutions that facilitate effective data processing and the data flow in organizations. With regard to Enterprise Management Systems (ERP), SAP is the world leader in the segment. SAP systems are present in more than 400,000 companies around the world and are responsible for managing business operations that together represent 87% of all global trade.

ERP stands for Enterprise Resource Planning. ERP software includes programs for all major processes, such as procurement, manufacturing, materials management, sales, marketing, finance, and human resources (HR). SAP was one of the first companies to develop standard software for business solutions and continues to offer industry-leading ERP solutions.

SAP ERP is divided into modules, each designed to meet the needs of a specific business function, such as Financial Accounting, Controlling, Procurement, Sales, Production, etc. These modules work in an integrated manner, which means that operations carried out in a given module trigger automatic registrations in the others, when applicable. Example: The purchase of consumables registered in the Supplies module automatically creates an Accounts Payable commitment (for the material supplier) in the Finances module. This is one of the main advantages of this ERP, as all processes, considering all the business functions served by this platform, are integrated among the multiple areas involved.

Large companies, which generate millions of jobs, offer products and services of the most diverse types everywhere and that promote enormous improvements in communities choose to use SAP ERP for a series of advantages, namely:

1. Improvements in communication

One of the biggest challenges in large companies, which have multiple business areas spread across different locations, is to maintain consistent communication and integration as their business progresses. ERP plays a key role in this regard, keeping business processes integrated between the different areas involved, ensuring that information reaches where it is needed.

By implementing SAP, due to its level of integration, companies eliminate most of the problems caused by lack of communication. The system will act in an integrated manner, allowing the recording of information on everything that is being or has been done. In this way, all employees will have access to the information necessary to carry out their work, without failing to do an important task due to forgetting or not knowing that it was necessary.

Automatic alerts can be sent to the teams responsible for executing something when the necessary conditions are in place. Furthermore, as the records will always be up to date, the risk of an error occurring due to lack of data exchange will decrease.

2. Greater scalability

The advantages of SAP are that they are easily scalable systems. This means that it is easy to add new features to the system, if necessary. Whenever necessary, the program allows new departments to be inserted, for example. So, if your company previously had a part of the system to control finance and another for the human resources department, but feel the need to have management in the logistics sector, for example, you can add this functionality in a practical way and fast. This helps to always keep up with the company’s growth. Today, with the increasing speed with which the market changes, having a scalable company is crucial. The lack of ability to expand or reduce the resources available to users can compromise the business’s response to market demands. As a result, delays will be frequent and the company will lose business. That is, investing in scalable tools is a crucial factor for the company’s success in the medium and long term.

In addition, SAP also invests millions of dollars annually in continuous improvement of its products. This is a platform present in the largest companies, receiving from them constant demands for technological advances. To stay up-to-date, SAP has highly qualified teams dedicated to sounding out the market and devising evolution strategies for its systems on an ongoing basis. The company that deploys SAP takes advantage of this ecosystem, having the guarantee that it will receive management software capable of offering the right answers to the challenges that arise as the global market advances.

3. Agility

We live in a time when everything happens very fast and we need to be agile and multitask to handle all the necessary demand. The SAP system, within this context, can be a great ally, both for its user experience and its ability to automate activities. The program is extremely agile and makes it possible to carry out searches very quickly, making everyday life much more optimized. The information needed to perform something can be displayed quickly, avoiding delays and bottlenecks in product delivery.

At the same time, more activities can be automated. This all contributes greatly to increasing the productivity of employees, who may even work in smaller numbers in each sector: if processes become more agile and automated, it reduces the number of human resources needed to keep the business functional.

4. Increased competitiveness

The local business scenario is extremely competitive, so that those who do not think strategically are soon left behind and overtaken by strong competition, which is only increasing in practically all sectors. SAP system also helps your company to be more competitive, because with more organized internal processes and running correctly, you can dedicate more time to strategic issues, not just operational ones.

In addition, using the SAP system means being part of a platform present in the vast majority of the largest companies on the planet. The constant presence in these companies over the years has made SAP applications evolve along with market practices and, today, the solutions offered by SAP are usually recognized for being good practices. Using this system allows you to take advantage of all that business knowledge that has flowed from companies to SAP.

5. Data control

Controlling data access has always been a somewhat complicated task for companies, as not all information should be made available to all employees of the organization. With SAP solutions, you can define which information can be accessed by each employee, who logs into the system with a username and password. Thus, more confidential information, such as those related to the organization’s finances and cash flow, may only be available to those responsible for this area and the company’s managers.

In addition, the breadth that this system can achieve in business processes ensures that most corporate data is in a single database. In this way, companies use SAP as the “single information base” for making business decisions, which considerably reduces the chances that different stakeholders consult different results for the same information in different databases and make incorrect decisions.

SAP is, therefore, a platform capable of helping large companies to solve some of their biggest challenges, which makes it a decisive part in the gears of a highly competitive and constantly evolving market.

It is also important to mention that the SAP system is present in several government entities of the American State, including a package of solutions developed specifically to meet the needs of these entities.