What is SAP and What Does SAP Stand For?

SAP stands for ” System Applications and Products in Data Processing“, a biggest software company headquatered in Walldorf, Germany. It was founded in 1972 as ” Systemanalyse und Programmentwicklung ” by former IBM employees, later named officially as SAP AG. Although generally not a famously known company as IBM or M$ is, but it is the fourth largest software company in the world. More information can be found at the SAP’s own webisite SAP.com, their official website.

What is SAP means?

SAP is mainly into the ERP – Enterprise Resource Planning sector, with its leading product SAP R/3. R stands for ‘Real Time Data Processing’ while 3 denotes the ‘3-tier Architecture‘ of the product. In a 3-tier architecture, we have 3 components in each tier: Presentation server which forms the front end / GUI, Application server which hosts the main R/3 system and finally, Database server which holds all the database related with the system.

This 3-tier architecture helps in making it a multi-user system as one Application server can serve many presentation server and thereby many users can login using the same Application server. Major SAP packages include APO (Advanced Planner and Optimiser), CRM (Suctomer Relationship Management), SRM (Supplier Relationship Management), HRMS (Human Resource Management Systems, PLM (Product Lifecycle Management), BW (Buisness Information Warehouse) and the latest technology platform SAP Netweaver.More than 28,000 companies run SAP, at over 91,500 locations. SAP users number over 12 million people in more than 120 countries.

The SAP has released the ECC Product (which is current version) which again has got two versions in the market – ECC 5.0 and ECC 6.0.

ECC stands for ERP Central Component.

SAP R/3 Enterprise Core – popularly known as Enterprise Release 4.7 – is the one version of the SAP R/3 suite of enterprise softwareapplications. It is designed to offer the best possible foundation for easily carrying the company through to e-business with mySAP Business Suite.

The first release of SAP R/3 Enterprise Core (4.7) contains some functional enhancements, but it is primarily a technical change. SAP R/3 Enterprise is built on SAP Web Application Server (SAP Web AS) and integrates seamlessly with the enterprise portals and exchange infrastructure.

SAP Enterprise Core is the heart of SAP R/3 4.7 and supports the packaging concepts, business configuration sets and Unicode-compliance. In addition, enterprise core provides users with the SAP R/3 Enterprise HR and non-HR Core Support Packages

Release 4.7 is a major change of direction for SAP and therefore for it’s customers. This new release needs to be closely studied by each of it’s customers and then acted on.

Architectural model of SAP R/3 Enterprise 4.7

The SAP R/3 4.7 version is the functional and technical advancement over classical Enterprise Resource Planning solution that provides customers flexibility, stability, new functions and new technology. It achieves these functions by facilitating connection to marketplaces, portals and other collaborative applications as well as enabling an easy evolution to mySAP.com. This new model of SAP R/3 is also more flexible to future upgrades.

The basic model of SAP R/3 Enterprise Release 4.7 consists of three parts:

  • Web Application Server
  • Enterprise Core
  • Enterprise Extensions


Web Application Server (WAS):

The WAS 6.2C of SAP Enterprise integrates all the features of already existing SAP Basis and Web application server. In addition, it provides users with additional enhancements in the form of package concept, global parameterization with business configuration sets, Unicode compliance, and accessibility.

Enterprise Core:

Enterprise Core (SAP Release 4.7) includes all R/3 4.6 functionality with limited functional enhancements and developments. On a go-forward basis, all legal changes and support packs, including stabilization and performance enhancements, will be applied at the Enterprise Core level. According to SAP, this Enterprise Core will remain stable until at least 2007. Therefore, no planned upgrades are necessary, just support packages.

Enterprise Extensions:

Extensions use a technology called ‘package builder.’ The concept is similar to user exits. Extensions may be activated selectively and independently of each other or remain inactive. A new set of extensions will be released annually as the Enterprise Core remains stable. For example, Extension Set 1.10, available with R/3 Enterprise, will consist of extensions in FIN (FI/CO), HR, PLM, TRVL, and SCM (WM, PP, MM).

If you take advantage of any Extension, the Extension would need to be activated in a similar manner and with the level of effort required to customize new functionality. This Extension philosophy decouples all development from the R/3 technical platform, allowing the SAP community more flexibility in taking advantage of enhanced functionality The Enterprise Extensions are the center of functional developments. These functionalities are selectively deployable and each functionality has its own release cycle.

Features and Benefits of SAP R/3 Enterprise Core (SAP Enterprise 4.7)

Thus, the main difference between 4.6C and 4.7 is that 4.7 comes with new technologies, optional deployment of new features and more flexibility is available for future upgrades. The basic architecture for SAP R/3 4.7 is given in the figure below:


SAP 4.7 has all the features such as development workbench, transport management system, monitoring, versioning and business object repository of already existing SAP 4.6C.
Web Application Server6.20 of 4.7 includes all the features of SAP Basis of SAP 4.6C.

SAP 4.7 has a more structured approach as compared to SAP 4.6C from a technical perspective. It is based on mySAP.com technology, which is actually the Web Application Server 6.2C. This not only includes SAP Basis Technologies with their latest advancements but also the new features of SAP Web AS 6.20.

SAP 4.7 is more structured even from a functional perspective as this version has been developed after functional and infrastructure developments of earlier SAP R/3 4.6C.

In SAP 4.7 the functional and infrastructure developments are made on separate levels. The functional developments are made in the Enterprise Extensions and infrastructure developments are made in the Enterprise Core unlike SAP 4.6C in which both the developments take place within the systems.

SAP in its Web AS has additional enhancements in the form of package concept, global parameterization with business configuration sets, Unicode compliance and accessibility that are not present in 4.6C.

SAP 4.7 Core supports the above-mentioned enhancements that SAP 4.6C does not.
SAP 4.7 unlike 4.6C has Enterprise Extensions that can be separately deployed and have their own releases.

Technical Specification of SAP Enterprise Core

The functionality of SAP R/3 Enterprise Core is based on the previous SAP R/3 release SAP R/3 4.6C. Its functionality has been enhanced in SAP 4.7 by optimizing and stabilizing of existing processes as well as legal changes and limited functional developments. Also, SAP R/3 Enterprise Core supports the packaging concept, business configuration sets, and Unicode-compliance. Moreover, it comes with five encapsulated extensions. These Extensions along with the enterprise core are maintained through scheduled support package tracks:

SAP R/3 Enterprise Core: Non-HR Core Support Package
SAP R/3 Enterprise Core: HR Core Support Package

In addition, SAP Enterprise Core features Accrual Accounting Engines. These enable Accrual Accountings, allowing users to automatically calculate and post accruals, such as license fees, rent costs, or revenues, in the general ledger accounting functionality of SAP R/3 Enterprise Core. Also, the users can calculate and post the accruals according to as many accounting principles as desired.

Other features of SAP Enterprise core are:

Native Internet
Support (SOAP/XML)
Open Integration
Web Services
Java and J2EE
Web Flow
Security Enhancements
New Upgrade Tools

New Functionality in SAP R/3 Enterprise 4.7

SAP Enterprise Core provides users with new functionalities in the following areas by incorporating SAP Enterprise Extensions in its architecture.

Also See: High Level & Fundamental understandings of SAP System Architecture

Recommended Reading For You

  • What Does SAP R/3 Involve?What Does SAP R/3 Involve?SAP R/3, SAP stands for System Application and Product for data processing. In German language it stands for "Systeme, Anwendungen und Produkte in der Datenverarbeitung". SAP R/3 doesnt […]
  • What is SAP means? Definition of SAP ERP SoftwareWhat is SAP means? Definition of SAP ERP SoftwareThe SAP means Systems Applications and Products in Data Processing. The name SAP, being a German company is an acronym for “System, Anwendungen, and Produkte in DerDatenverarbeitung”. This […]
  • SAP R/3 HistorySAP R/3 HistoryThe company SAP was founded in Waldorf, Germany, in 1972 by five ex IBM engineers (Dietmar Hopp, Hans-Werner Hector, Hasso Plattner, Klaus E. Tschira, Claus Wellenreuther). SAP stands for […]
  • What is SAP?What is SAP?SAP is an ERP package, which is used in many companies worldwide.The full form for SAP is System Application Products in Data Processing. The product is German in origin. The full form […]
  • SAP R/3 Architecture hardware viewSAP R/3 Architecture hardware viewThe SAP R/3 Architecture hardware view is called a development view, the view of the R/3 architecture, is hard functionality, or we can the process functionality of information with in the […]

Leave a Reply

Your email address will not be published. Required fields are marked *

%d bloggers like this: