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SAP/R3 ERP Essay



This report gives a brief definition of data warehousing and further explains the benefits that organization gain by using this technology towards strengthening and shaping their businesses’ competitive edge.

Additionally, the report gives a detailed overview of SAP/R3 ERP solution and points out some of the companies which are using this solution.

Data warehousing

Data warehousing is a term which is refer to a massive database acting as a centralized depository of data emanating or originating from different departments in an organization (Ponniah, 2001, p.19).

Merits of Data warehousing

Many organizations have used colossal sums of money in implementing data warehouse solutions. These huge sums of money are not spent in vein; there are many benefits that accrue from adopting data warehousing solutions.

The first fundamental benefit that this solution offers to an organization is that it facilitates business executives to formulate incisive decisions (Ponniah, 2001, p.4).

Data warehousing comes with the creation of a central depository data base. Easy access to centralized organizational information is important because it allows decision makers to view an organization as a whole rather than from the angle of departments.

The second benefit of data warehousing is that data in the warehouse can be modeled in the form that speeds up the generation of reports (Ponniah, 2001, p. 91). Data warehousing creates an environment where companies can exercise the use of data models.

Data modeling is important as the models can be used towards easy analysis of situations even when the task to be done is demanding and difficult for processing.

Thirdly, data warehousing helps simplify data management operations in an organization. Data warehousing offers an opportunity for the organization to store and retrieve data in a relatively simple manner instead of employing complex and challenging methods.

Data can be accessed simply by typing simple commands on a panel then the system communicates back with the desired information (Ponniah 2001, p.49). Users can therefore comfortably use queries to look for kind of information they want at any time.

SAP R/3 Overview

SAP is an example of Enterprise Resource Planning (ERP). SAP R/3 is a business solution which has transformed the manner in which modern organization carry out their businesses.

SAP R/3 is a solution which facilitates the integration of an organization’s departmental functions to a single computer unit which can in turn serve all available computers in different departments within an organization (Leon 2007, p. 90).

SAP solutions can help integrate operations in the Human resources, Finance, Manufacturing, warehousing and all the other departments in an organization (Leon 2007, p. 91). The SAP solution involves the use of a packaged program or software which has been tailored for an organization and its modules facilitate interfacing with the organizations own program with less complexity.

Depending on an organization’s needs, SAP program modules can be altered by the use of vendors programming language or correct proprietary tools.

Because of its integration ability with other programs, The SAP provides a centralized database to cover all the organizations departments facilitating easier sharing of information and communication within the departments in an organization.

The benefits of using an ERP solution in a corporate entity are numerous. An ERP solution like SAP helps in facilitating faster processing of information thereby reducing paperwork operations; SAP functions in a simple way (DWAA, 2006). It has some internal embedded controls in its operations.

With internal checks and controls, SAP solution makes the preparation of accounts and other financial documents easier and fast. It is very simple to generate account statements at the end of every accounting period. A SAP solution has features that enable it to support various languages and currencies (Williams 2008, p. 3).

Further, SAP systems or solutions are tailored in a way that it supports international accounting and reporting standards e.g. flexibility to accommodate currency conversions, broad accounting standards and languages (Williams, 2008, p. 23).

Financial SAP has various features and functions that enable organization achieve its financial management goals (Sap: Australia and New Zealand, 2010).

Conclusively, SAP helps organizations to have an upper hand over their competitors by enabling fast adaptation to changes in the market and business environment. In the human resource department, SAP ensures that there is a continuous flow of Information related to an organization’s personnel.

When such information is received by the HR department, it facilitates employee evaluations and manpower planning (Portougal, 2006, p. 132). Human resource related evaluations help organizations in establishing skill and knowledge needs as well as attitude related gaps or issues that have to be addressed.

The collection of such information is important for employees as it is instrumentally applied to encourage improvement of working conditions within the organization (Portougal, 2006, p. 167). However the disadvantage of the SAP R/3 solution is that it requires large volumes and high investments in terms of money and time.

Companies using SAP R/3 solutions

TransAlta is a wholesale marketing and power generating company. It has 49 facilities based in Australia, Canada, USA and Mexico (Transalta, 2010). Prior to introduction of SAP solution, the TransAlta Company was using Reliability Centered Maintenance this solution was localized at different locations by the use of point solution.

TransAlta wanted an Enterprise-wide system which would offer strategy development and provide understanding of vital assets, monitor overall risk in the organization and give optimized operations concerning maintenance costs.

The implementation of the SAP solution involved integrating the existing Reliability Centered Maintenance (RCM) to facilitate wide accessibility (Transalta, 2010). The RCM enabled creation of a central database for all RCM that can be standardized across a uniformed platform hence providing optimized maintenance.

The implementation of the solution has enhanced success in fleet management because information is dispersed a centralized depository allowing easier communication and accessibility. The RCM solution has motivated staff to work everyday in SAP and thus the company can push the RCM methodology and cultivate it deeper within the organization.

Cole Meyers is a private sector company which is located In Australia. It has over 160,000 employees in its distributed branches (Turner, 2002). Cole Myer has invested heavily in IT services and has been known to purchase large IT services and Software solutions in order to remain relevant in current competitive business world.

Coles Myers worked closely with PricewaterhouseCoopers to deploy SAP solution in its Business operations. Cole Myer business was already automated with industry based bar-coding technology for inventory management and stock control. Cole Meyer needed a solution which would help them handle and manage their financial flow.

The Company felt confident in fully integrating SAP solution into their financial management. The implementation of SAP took two years and it was broken down into manageable phases to facilitate concise performance (Turner, 2002).

The Supply Chain Visibility was followed and this enabled members to monitor what other members did in a real time. The Supply Chain Visibility also provided a mechanism in real time notifying a problem elsewhere within supply chain that would have effect on them.

Although the management and the board were apprehensive about the solution, they later came to analyze its effectiveness noticing how it lowered down costs and time thus enabling timely production of reports in real time.

The Australian post is a postal company located in Australia. Through their products, people and services they provide, the Australian post has remarkably facilitated life and business growth across Australia and the world.

The Implementation of the SAP solution in the company involved a number of things. It involved ERP system upgrades to meet the standard required for the new technology, there was hardware upgrade to have a new operational environment; IBM P- series hardware’s were purchased (The Australian, 2010).

SAP Financial management application was implemented and supported 35,000 employees and additional 860 personnel in the IT department. The company felt confident in relying on the software giant because of the reputation and efficiency.


Integration of business processes is the central aim or goal that guides towards adoption of data warehousing. Organizations benefit a lot from adopting data warehousing. By keeping or storing information in a central data base, information access and retrieval about any aspect of the organization is made easy.

The access to one central pool of information leads towards informed decision making. Therefore, Data warehousing facilitates towards better decision making in organizations.

The SAP solution, which is an ERP solution, has been applied in many organizations around the world and the results have been rewarding. This solution simplifies an organization’s data warehousing efforts.


DWAA, 2006, Improving Data Quality for Enhanced Business Performance. Web.

Leon, A., 2007, Enterprise Resource Planning, McGraw-Hill, New York.

Ponniah, P., 2001, Data Warehousing Fundamentals: a Comprehensive Guide for IT Professionals, John Wiley and Sons, New York.

Portougal, V., Sundaram, D., 2006, Business Processes: Operational Solutions for SAP Implementation, Idea Group Inc (IGI), Pennsylvania.

, 2010. Web.

The Australian, 2010, Australian IT. Web.

Transalta, 2010, TransAlta Case Study. Web.

Turner, A., 2002, Coles Myer- the Sharing, Caring Approach. Web.

Williams, G., C., 2008, Implementing SAP ERP Sales & Distribution, McGraw-Hill, New York.

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