What is SAP?

You’ve probably heard the term SAP here and there, maybe you even know a bit more about it, but you’re still unsure about what is SAP.

 

In order to avoid immediate confusion let’s start by saying that SAP is both a company and software.

 

SAP is the acronym of a German multinational software development corporation’s name, and they specialize in the development of enterprise related software. Most of their software is preceded with the company’s acronym, so “SAP software” actually references to more than one solution, but most people consider SAP to be their enterprise resource planning (ERP) solutions.

 

The company was founded under the name “Systemanalyse und Programmentwicklung” (System, Analysis and Program Development) in 1972 by five IBM ex-engineers, but the acronym was later changed to stand for “Systeme, Anwendungen und Produkte in der Datenverarbeitung” which means Systems, Applications and Products in Data Processing. As of now it is the largest business software provider in the world, and it owns most of the market share of large companies around the globe.

 

Even though it’s such a large company it’s still common among small and medium enterprises to hear the question, what is SAP?

 

This happens because SAP is still making its way into the small and midsize enterprise (SME) market. Despite the fact that they have dedicated a hefty amount of resources during the last decade to develop solutions for small and midsize enterprises (SMEs), as well as help partners promote these, the stigma that SAP is an expensive solution that only large corporations can afford lingers on.

 

This is a misconception that SAP and most of its partners have been trying to steadily change throughout the years. As a matter of fact, right now they are constantly working to keep innovating and providing the best solutions for large companies, but they know the future of business lies within the SMEs market.

 

Before moving on, we just mentioned that SAP works along partners, and this is a key aspect of their business model. Only official partners are allowed to distribute the SME’s solutions developed by SAP, even SAP doesn’t only handles deals with large companies directly.

 

Which leads us to their ERP solutions.

 

SAP offers ERP solutions for companies of any size operating in any industries; these are SAP ERP 6.0 for corporations, SAP All-In-One for mid-size to large companies, SAP Business One for small and midsize enterprises and SAP Business One in Cloud for microenterprises.

 

Although SAP ERP 6.0 and SAP Business One in Cloud have a clearly defined segment, its common to find people asking which is the difference between SAP Business One and SAP All-In-One (A1). The main difference between both is that SAP Business One is designed to cover the needs that all industries have, and it can be expanded via add-ons developed through SAP’s SDK to cover specific industry needs and more, while A1 is a slightly more complex solution developed to cover all the needs a company might present per industry. In many cases that is not enough information to perceive the difference between both solutions, in which case just think about its monetary cost; SAP Business One can be implemented with an investment of a few thousand dollars, while most, if not all A1 projects, have a cost of over $1,000,000 US dollars. So, if you’re not willing to spend a million dollars or more, go for SAP Business One, otherwise evaluate both solutions, as you might prefer B1 instead of A1 depending on your situation.  

 

We have covered the basics of what is SAP in this text; if you want to learn more about SAP’s products, our products, or read articles that will help you improve your business’s performance, we encourage you to go back to the education section of our site.

 

For the full recap on SAP, go to http://en.wikipedia.org/wiki/SAP_SE