SAP the company was founded in Germany in 1972 by five ex-IBM engineers. In case you’re ever asked, SAP stands for Systeme, Andwendungen, Produkte in der Datenverarbeitung which - translated to English - means Systems, Applications, Products in Data Processing. So now you know! Being incorporated in Germany, the full name of the parent company is SAP AG. It is located in Walldorf, Germany which is close to the beautiful town of Heidelberg. SAP has subsidiaries in over 50 countries around the world from Argentina to Venezuela (and pretty much everything in between). SAP America (with responsibility for North America, South America and Australia - go figure!) is located just outside Philadelphia, PA.

So, what is SAP? It is a company. But read on, it is more than just a company ...

The original five founders have been so successful that they have multiplied many times over such that SAP AG is now the third largest independent software maker in the world, with over 80,000 customers (including way more than half of the world's 500 top companies). SAP employs over 50,000 people worldwide today, and had revenues of $16.9 billion and Net Income of $2.7 billion in FY08. SAP is listed in Germany (where it is one of the 30 stocks which make up the DAX) and on the NYSE (ticker:SAP). 

There are now more than 121,000 installations of SAP, in 120 countries, with more than 12 million users! So now, what is SAP? It is a company, but it is also a product.

So and what made this company so successful? Back in 1979 SAP released SAP R/2 (which runs on mainframes) into the German market. SAP R/2 was the first integrated, enterprise wide package and was an immediate success. For years SAP stayed within the German borders until it had penetrated practically every large German company. Looking for more growth, SAP expanded into the remainder of Europe during the 80's. Towards the end of the 80's, client-server architecture became popular and SAP responded with the release of SAP R/3 (in 1992). This turned out to be a killer app for SAP, especially in the North American region into which SAP expanded  in 1988.

The success of SAP R/3 in North America has been nothing short of stunning. Within a 5 year period, the North American market went from virtually zero to 44% of total SAP worldwide sales. SAP America alone employs more than 5,000 people and has added the names of many of the Fortune 500 to it’s customer list (8 of the top 10 semiconductor companies, 7 of the top 10 pharmaceutical companies etc). SAP today is available in 46 country-specific versions, incorporating 28 languages including Kanji and other double-byte character languages. SAP also comes in 21 industry-specific versions.

So, what is SAP? It is a company, and it is a product. now you know it is also very functionally rich, and pretty huge.

SAP R/3 is delivered to a customer with selected standard process turned on, and many many other optional processes and features turned off. At the heart of SAP R/3 are about 10,000 tables which control the way the processes are executed. Configuration is the process of adjusting the settings of these tables to get SAP to run the way you want it to. Think of a radio with 10,000 dials to tune and you’ll get the picture. SAP functionality included is truly enterprise wide including: Financial Accounting (e.g. general ledger, accounts receivable etc), Management Accounting (e.g. cost centers, profitability analysis etc), Sales, Distribution, Manufacturing, Production Planning, Purchasing, Human Resources, Payroll etc etc etc. For a full description of the modules included in SAP, see the related articles. All of these modules are tightly integrated which – as you will find out – is a huge blessing ... but brings with it special challenges.

So, what is SAP? It is a company, a product, it is huge, and now you know it is also very complex to make it work, with 10,000 tables to configure.

SAP are maintaining and increasing their dominance over their competitors through a combination of
- deepening the functionality on their industry solutions
- launching business one - for the medium market
- starting to embrace SOA with the Netweaver platform

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