The 123s of ABC in SAP

3OVERVIEW OF SAP AND INTEGRATED ACTIVITY-BASED COSTING

Before proceeding with the details of integrated ABC in SAP R/3, a basic understanding of the SAP application must exist. Chapter 2 established the differences between stand-alone and integrated ABC systems in general. This chapter provides an overview of the SAP R/3 application as a whole and its components. For readers who are very familiar with the SAP R/3 modules and functionality, this chapter may not be relevant other than to establish a common understanding of acronyms.

The SAP R/3 business application is a tightly integrated, transaction-based, operational-level, enterprise resource planning system. This integrated nature of SAP generates the largest benefits of this software solution; however, this integration also causes the greatest difficulties in implementations. One area of SAP R/3 cannot be discussed, designed, trained, or scoped without understanding the next integrated piece of the system to be affected. SAP R/3 consists of application areas addressing financials, logistics, and human resources. Within each application area are one to many modules. These modules are logical groupings of system capabilities into areas of functionality, such as financials, production, sales and distribution, materials management, human resources, and so on. Exhibit 3.1 illustrates the core SAP R/3 modules. Each hexagon represents a module and the shading represents the application area.

Exhibit 3.1 Overview of Core SAP R/3 ...