SAP Overview

SAP History, SAP Evolution, SAP R/1, SAP R/2, SAP R/3, SAP ECC, mySAP, SAP Business one, SAP Suite, SAP NetWeaver, SAP ABAP

Study Material Contributed by Ulhas Kavle - Senior SAP Consultant

What is ERP

What is ERP ?

ERP is a package with the techniques and concepts for the integrated management of business as a whole, for effective use of management resources, to improve the efficiency of an enterprise. Initially, ERP was targeted for manufacturing industry mainly for planning and managing core business like production and financial market. As the growth and merits of ERP package ERP software is designed for basic process of a company from manufacturing to small shops with a target of integrating information across the company.

History and Evolution of SAP

History and Evolution of SAP

SAP Initiation -

SAP, started in April 1st 1972 by five former IBM employees in Mannheim, Germany, states that it is the world's third-largest independent software vendor. It started with a vision: to develop standard application software for real-time business processing. They wanted to develop and market a standard enterprise software which would integrate all business processes, because they had noticed that client after client was developing the same or very similar computer business programs which though were not really integrated with each other.

SAP stands for Systems, Applications and Products (Systeme, Anwendungen und Produkte in the original German) in Data Processing, this definition turns you towards a fact that SAP creates a common centralised database for all the applications running in an organization.

SAP R/1 -

The first version of SAP's flagship enterprise software was a financial Accounting system named R/1.

SAP R/2 -

This was replaced by R/2 at the end of the 1970s. SAP R/2 was in a mainframe based business application software suite that was very successful in the 1980s and early 1990s. It was particularly popular with large multinational European companies who required soft-real-time business applications, with multi-currency and multi-language capabilities built in.

SAP R/3 & SAP R/3 Enterprise -

SAP R/3 was officially launched on 6 July 1992. With the advent of distributed client-server computing SAP AG brought out a client-server version of the software called SAP R/3 (The "R" was for "Real-time data processing" and 3 was for 3-tier).

The client/server three-tier architecture composed of a database, software applications and a common graphical user interface (GUI). This new architecture is compatible with multiple platforms and operating systems, such as Microsoft Windows or UNIX. The client-server concept, uniform appearance of graphical interfaces, consistent use of relational databases, and the ability to run on computers from different vendors meets with overwhelming approval.

SAP R/3 through version 4.6c consisted of various applications on top of SAP Basis, SAP's set of middleware programs and tools. Though when SAP R/3 Enterprise was launched 2002, all applications were built on top of the SAP Web Application Server. Extension sets were used to deliver new features and kept the core as stable as possible. The Web Application Server contained all the capabilities of SAP Basis.

SAP R/3 was arranged into distinct functional modules, covering the typical functions in place in an organization. The most widely used modules were Financials and Controlling (FICO), Human Resources (HR), Materials Management (MM), Sales & Distribution (SD), and Production Planning (PP). Each module handled specific business tasks on its own, but was linked to the others where applicable. For instance, an invoice from the billing transaction of Sales & Distribution would pass through to accounting, where it will appear in accounts receivable and cost of goods sold.

SAP typically focused on best practice methodologies for driving its software processes, but more recently expanded into vertical markets. In these situations, SAP produced specialized modules (referred to as IS or Industry Specific) geared toward a particular market segment, such as utilities or retail.

Releases -

SAP R/3 Release 3.1I

SAP R/3 Release 4.0B Release Date June 1998

SAP R/3 Release 4.5B Release Date March 1999

SAP R/3 Release 4.6B Release Date Dec 1999

SAP R/3 Release 4.6C Release Date April 2001

SAP R/3 Enterprise Release 4.70 Release Date March- Dec 2003


SAP used the name R/3 until the 5.0 release (SAP ECC 5.0 ERP is the successor of SAP R/3 4.70).

As a result of marketing changes and changes in the industry, other versions of SAP have been released that address these changes. The first edition of mySAP ERP (SAP ERP) was launched in 2003 and bundled previously separate products, including SAP R/3 Enterprise, SAP Strategic Enterprise Management (SEM) and extension sets. The SAP Web Application Server was wrapped into NetWeaver, which was also introduced in 2003.

A complete architecture change took place with the introduction of mySAP ERP edition 2004. R/3 Enterprise was replaced with the introduction of ERP Central Component (SAP ECC). The SAP Business Warehouse, SAP Strategic Enterprise Management and Internet Transaction Server were also merged into SAP ECC, allowing users to run them under one instance. Architectural changes were also made to support an enterprise services architecture to transition customers to a services-oriented architecture. The most current version as of November 2009 is ECC 6.0.

Thus with the Internet becoming pervasive, SAP responded by providing companies with the software they needed to sell goods and services online. Their product portfolio got a Web interface and was rebranded MySAP was designed to be a corporate Web portal with role-based permissions for employees . The company promoted how SAP "solutions" could link commerce conducted over the Internet (e-commerce) with traditional bricks and mortar commerce to provide one seamless view of the business.

What is SAP NetWeaver

What is SAP NetWeaver -

The SAP Web Application Server was wrapped into NetWeaver, which was also introduced in 2003.

Came thus the SAP NetWeaver, the company’s development and integration platform and middleware component, and Business Suite, a bundling of SAP’s enterprise resource planning (ERP), customer relationship management (CRM), supply chain management (SCM), product lifecycle management (PLM) and supplier relationship management (SRM) applications. In 2008, SAP purchased Business Objects, a French enterprise software company that specializes in business intelligence (BI), which marked a major change in the company’s BI strategy, which was previously focused around SAP's Business Explorer tools.

SAP NetWeaver can be defined in one sentence as a service-oriented technology platform (SOA) for integrating information and business processes across diverse technologies and organizational structures. NetWeaver provides the foundation for other SAP software bundles.

Another version of SAP NetWeaver

SAP NetWeaver is SAP's integrated technology platform and is the technical foundation for all SAP applications since the SAP Business Suite. SAP NetWeaver is marketed as a service-oriented application and integration platform. SAP NetWeaver provides the development and runtime environment for SAP applications and can be used for custom development and integration with other applications and systems. SAP NetWeaver is built using open standards and industry de facto standards and can be extended with, and interoperate with, technologies such as Microsoft .NET, Sun Java EE, and IBM WebSphere.

SAP NetWeaver's release is considered as a strategic move by SAP for driving enterprises to run their business on a single, integrated platform that includes both applications and technology. Industry analysts refer to this type of integrated platform offering as an "applistructure" (applications + infrastructure). According to SAP, this approach is driven by industry's need to lower IT costs through an enterprise architecture that is at once (1) more flexible; (2) better integrated with applications; (3) built on open standards to ensure future interoperability and broad integration; and, (4) provided by a vendor that is financially viable for the long term. SAP is fostering relationships with system integrators and independent software vendors, many of the latter becoming "Powered by SAP NetWeaver".

SAP NetWeaver is part of SAP's plan to transition to a more open, service-oriented architecture and to deliver the technical foundation of its applications on a single, integrated platform and common release cycle.


NetWeaver is essentially the integrated stack of SAP technology products. The SAP Web Application Server (sometimes referred to as WebAS) is the runtime environment for the SAP applications—all of the mySAP Business Suite solutions (SRM, CRM, SCM, PLM, ERP) run on SAP WebAS.


The core products that make up SAP NetWeaver include:

SAP has also teamed with hardware vendors like HP, IBM, Fujitsu-Siemens, and Sun to deliver appliances (i.e., hardware + software) to simplify and enhance the deployment of NetWeaver components. Examples of these appliances include:

Development Tools

see also:


Specifically, ERP is being extended by Business Process Management Systems (BPMs) and, as BPMs takes hold as the pre-dominant technical platform for new applications, expect to see radical changes to ERP architecture in the years ahead. Allen Davis, a NetWeaver xMII expert, has successfully used Six Sigma scenarios as information in real time from shop floor control systems and used in plant quality control lab experimental tests. The technology has been applied to a wide range of industries and applications.

SAP's Netweaver platform is still backwards-compatible with ABAP, SAP's custom development language.