Enterprise Systems Modeling EGN 5620 Enterprise Systems Configuration

Enterprise Systems Modeling EGN 5620 Enterprise Systems Configuration Spring, 2012

Enterprise Systems Modeling: Concepts and Tools EGN 5620 Enterprise Systems Configuration

Information systems modeling tools IDEF ◦ IDEF 0 (activities) ◦ IDEF 1 x (information) ◦ IDEF 2 x (dynamics) OMT ◦ Functional model ◦ Object model ◦ Dynamic model

IDEF Concept (1) IDEF (ICAM Definition) ◦ Developed by the US Air Force Integrated Computer Aided Manufacturing (ICAM) Programs in 1981 ICAM Objective ◦ To develop structured methods for applying computer technology to manufacturing and to better understand how best to improve manufacturing productivity

IDEF Concept (2) IDEF 0 ◦ An activity model of a manufacturing system and environment IDEF 1 ◦ An informational model of the system and environment IDEF 2 ◦ A dynamic model to describe time-varying system behavior

IDEF Concept (3) IDEF Methodology ◦ Modeling process and tools, leading to creation of the three IDEF models IDEF 0 (activities) IDEF 1 x (information) IDEF 2 x (dynamics) Commercial IDEF software tools ◦ Design/IDEF by Meta Software Company ◦ AI 0 WIN by Knowledge Based Systems Inc.

OMT Concepts (1) Object modeling technique (OMT) “Object-oriented” means: ◦ Software organized as a collection of discrete objects that incorporate both data structure and behavior, in contrast to conventional programming in which data structure and behavior are only loosely connected. OMT ◦ ◦ Methodology (in stages): system analysis, system design, Object (implementation) design, and implementation.

OMT concepts (2) - common themes Synergy (i. e. , shifting focus from coding technique to packaging, based on consistent ◦ identity, ◦ classification, ◦ polymorphism, and ◦ inheritance Abstraction, Encapsulation, Combining Sharing data and behavior, (inheritance of data structure & behavior among subclasses) Emphasis on object structure (not procedure structure),

OMT Concepts (3) - Synergy Identity ◦ Data is quantized into discrete, distinguishable entities called objects Classification ◦ Objects with the same data structure (attributes) and behavior (operations) are grouped into a class An operation is an action or transformation that an object performs or is subject to. polymorphism ◦ The same operation may behave differently on different classes. A specific implementation of an operation by a certain class is called a method. Each operation may have multiple methods implementing it. inheritance ◦ The sharing of attributes and operations among a hierarchy of object classes

OMT Models (4) 3 OMT models used to describe a system: ◦ Object model describing the objects in the system and their relationships; ◦ Dynamic model describing the interactions among objects in the system; and ◦ Functional model describing the data transformation of the system. Their relationship ◦ The object model describes what changes (or transforms) before when (dynamic model) or how (functional model) it changes.

OMT Functional Model (5) It describes the data value transformations within a system. The functional model contains data flow diagrams. ◦ A data flow diagram is a graph whose nodes are processes (activities) and whose arcs are data flows.

OMT Object Model (6) It describes the static structure of the objects in a system and their relationships. The object model contains object diagrams. ◦ An object diagram is a graph whose nodes are object classes and whose arcs are relationships among classes.

OMT Dynamic Model (7) It describes the aspects of a system that change over time and is used to specify and implement the control aspects of a system. The dynamic model contains state diagrams. ◦ A state diagram is a graph whose nodes are states and whose arcs are transitions between states caused by events.

Relationship between the two techniques & among the three models IDEF 0/functional model ◦ The input to an activity is usually through a user interface for data entry ◦ The output from an activity is usually a user interface for a report, though the output may be a write/update to a database. IDEF 0’s ◦ ICOM Material is an input object. Product/process data are output objects. Rules/regulations and SOPs are constraints. Technical precedence is a constraint Resources/tools and methods are a mechanism. IDEF 1/object model ◦ The collection of the ICOM of an IDEF activity model constitutes an inclusive foundation for the object model. IDEF 2/dynamics model ◦ Each object requires a state diagram to define/govern its life-cycle behavior. ◦ A triggering event is associated with each transition from one state to another. One state may transform to multiple states, depending on the triggering event.

SAP System Modeling Design EGN 5620 Enterprise Systems Configuration

SAP R/3 Enables a company to link it’s business processes Ties together disparate business functions (integrated business solution) Helps the organization run smoothly Real-time environment Scalable and flexible January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 35

Architecture Central relational database ◦ Oracle, Informix, Microsoft SQL, etc. Client/Server – three-tiered ERP Components – Oriented towards common identifiable business modules: ◦ MM, SD, PP, FI, CO, HR, WM, QM, PM Add-ons: ◦ Customer Relationship Mgmt (CRM) ◦ Supply Chain Mgmt (SCM) ◦ Product Lifecycle Mgmt (PLM) ◦ Business Intelligence (BI) January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 36

Relational Database Tables: Defines and links a couple of tens thousands of tables of information (25, 000+) Advantages ◦ Consistent and accurate data ◦ Common definitions for terms ◦ Shared, but restricted usage (e. g. , profiles) ◦ Eliminates data redundancy January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 37

Client/Server Environment Client ◦ Software/hardware combination that can make a request for services from a central repository of resources Server ◦ Software/hardware combination that can provide services to a group of clients in a controlled environment January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 38

Three-Tier SAP Structure GUI – Graphical User Interface or Web Interface Application server (one or many) Database server (one single location) January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 39

SAP Enterprise System PCs, Laptops, etc. Browser Client Network Web Server Internet Transaction Server Presentation Application Servers Database January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 40

SAP ERP Modules FI SD MM PP SM Service Mgmt. Materials Mgmt. Production Planning QM Quality Mgmt. PM CO R/3 Controlling Client / Server Integrated Business Solution Plant Maintenance January 2008 Financial Accounting Sales and Distribution AM Fixed Assets Mgmt. EC PS WF Enterprise Controlling Project System Workflow HR IS Human Resources Industry Solutions © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 41

Business Modules Collections of logically related transactions within identifiable business functions ◦ MM (“Buy”) ◦ PP (“Make”) ◦ SD (“Sell”) ◦ FI and CO (“Track”) ◦ HCM (“People”) January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 42

SAP R/3 Basics Instance – each install of the SAP R/3 software on an individual application server Configurable – each instance can be distinctively configured to fit the needs and desires of the customer (within limits) Most of the infrastructure decisions, including configuration decisions, occur during project implementation January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 43

Configuration The process of tailoring SAP software by selecting specific functionality from a list of those supported by the software, very much like setting defaults (e. g. , Word, Access) DOES NOT involve changes to the underlying software code January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 44

Programming Code Modifications Changes to the delivered code ABAP/4 – Advanced Business Application Programming (ABAP) This should be done sparingly and carefully as it can make migration to new versions of the software much more difficult January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 45

SAP R/3 Document Principle Each business transaction that writes data to the database creates a uniquely numbered electronic document Each document contains information such as ◦ Responsible person ◦ Date and time of the transaction ◦ Commercial content Once created, a document can not be deleted from the database January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 46

SAP Business Processes EGN 5620 Enterprise Systems Configuration

Components of Materials Management Foreign Trade/ Customs Valuation Materials Management (MM) Logistics Invoice Verification Service Master Product Catalog MRP Purchasing Service Entry Sheet Material Master Inventory Mgmt. Physical Inventory January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 48

Integration Procurement Process (Procure-to-Pay) Purchase Requisition Purchase Order Notify Vendor Payment to Vendor Invoice Receipt January 2008 Vendor Shipment Goods Receipt © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 49

Components of Sales and Distribution Shipping Transport Sales and Distribution (SD) Sales Information System Sales Support Master Data Billing Foreign Trade Sales Credit Mgmt. January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 50

Integration Sales Order Process (Order-to-Cash) Check Availability Sales Order Entry Pick Materials Receipt of Customer Payment Invoice Customer Pack Materials Post Goods Issue © SAP AG - University Alliances January 2008 and The Rushmore Group, LLC 2008. All rights reserved. 51

Components of Production Planning MRP Production Planning (PP) Production Planning Production Control Product Cost Planning Master Data Repetitive Mfg. SOP DRP KANBAN Capacity Planning January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2007. All rights reserved. 52

Production Process (Make-to-Stock) Production Proposal (Planning/Other) Capacity Planning Schedule and Release Shop Floor Documents Order Settlement Goods Issue Goods Receipt Completion Confirmation © SAP AG - University Alliances January 2008 and The Rushmore Group, LLC 2007. All rights reserved. 53

SAP Business Processes Integration (Overview) EGN 5620 Enterprise Systems Configuration

Functional Areas – Where and When Business Process Integration ◦ Materials Management (MM) ◦ Sales and Distribution (SD) January 2008 I © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 55

Business Process Integration (I) SD Master Rules Org Data MM Data FI MM SD FI FI MM MM SD SD January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 56

Organizational Data A hierarchy in which the organizational units in an enterprise arranged according to tasks and functions Are static data and are rarely changed The definition of organization units is a fundamental step, it is a critical factor in how the company will be structured January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 57

Master Data Master data is relatively fixed ◦ Material master data ◦ Vendor master data ◦ Purchasing information record ◦ General Ledger master data Before making the master data configurations, you must have completely defined the organizational structures January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 58

Rules Defines the parameters for Master Data and Transactions Determines functionality for Master Data and Transactions Relatively fixed Changes as policy changes January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 59

Transaction Data Includes internal and external exchanges that describe business activities Unlike master data, aggregate transactional data is dynamic – each transaction is unique January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 60

Functional Areas – Where and When Business Process Integration ◦ Materials Management (MM) ◦ Production Planning (PP) ◦ Sales and Distribution (SD) January 2008 II © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 61

Business Process Integration (II) PP SD FI ata MM D Master FI SD Rules Org Data MM PP FI MM MM PP PP SD SD January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 62

Learning Approaches ◦ Cross business functions ◦ Understand business processes and their relationships to SAP's organizational structure ◦ Highlight integration/configuration!! January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 63

Learning by Creating a Model Business Understanding business processes and their integrative nature Understanding SAP organizational structures Combining business processes and SAP organizational structure (i. e. , configuration) Test the newly configured system View system outputs - statistics, reports, and graphics January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 64

PEN, Inc. System Modeling Design EGN 5620 Enterprise Systems Configuration

Pen Inc. Start-up company in the promotional pen business Initially buys and re-sells different lines of promotion pens Sells to both wholesale and retail – procure and distribute Later acquires a production facility to manufacture its own product – produce and distribute January 2008 © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 66

Enterprise Structure Credit Control Area Client Fiscal Year Variant Chart of Accounts Company Code Controlling Area Purchasing Organization Plant Purchasing Group SL 10 SL 20 Shipping Point Sales Organization Distribution Channel Division Sales Area

Pen Inc. Business Module I for Selling Trading products Pre-Sales Activity Sales Order Delivery Availability Check Accounts Receivable Goods to Delivery In Inventory YES NO Billing Plant or Warehouse Inventory Postings General Ledger Accounts Goods from Purchase Order Pen Purchase. Incorporated Purchase Goods Invoice Requisition Order Receipt Procure for Sales Order January 2008 Accounts Payable © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 68

Pen Inc. Business Module II for Selling Finished Goods by Production Pre-Sales Activity Sales Order Availability Check In Inventory Accounts Receivable Inventory Postings General Ledger Accounts Goods Issued to Delivery YES Plant or Warehouse Issue Goods to NO Production Order Planned Order Billing Delivery Production Order Goods from Production Order Completion Confirmation January 2008 Accounts Payable © SAP AG - University Alliances and The Rushmore Group, LLC 2008. All rights reserved. 69

Pen Inc. Business Module II for Selling Finished Goods by Production Pre-Sales Activity Sales Order Availability Check YES NO Accounts Receivable Inventory Postings General Ledger Accounts Goods Issued to Delivery In Inventory Issue Goods to Production NO Order Purchase Requisition Billing Delivery Plant or Warehouse Purchase Order Goods from Production Order Goods Receipt Invoice Receipt Accounts Payable NO Planned Order Production Order Completion © SAP AG - University Alliances and The Rushmore Group, LLC Confirmation January 2008. All rights reserved. 70

Exercises: Create company code 22. Create chart of accounts 23. Assign company code to chart of accounts 24. Assign company code to fiscal variant 25. Create Credit control area 26. Assign company code to credit control area 27. Assign permitted credit control areas to company code 29. Define plant 30. Define storage locations (inventory and quality) 31. Define purchasing organization 32. Create purchasing group 21.

Exercises: 33. Assign plant to company 34. Assign purchasing org. to company code 35. Assign purchasing org. to plant 36. Set up parameter ID 37. Create Account groups 38. Define retained earnings account 39. Review field status variant 40. Assign company code to field status variant 41 -57 Create 17 general ledger accounts 58. Run general ledger list of accounts reports Homework due date: 1/30/2012