While SAP is commonly referred to in its abbreviated form, it actually stands for Systems, Applications and Products in Data Processing. While the full name accurately describes what’s on offer, the abbreviation was chosen to create a focus on the core software. The company was founded in Germany back in 1972 by five ex-IBM engineers and has grown into the world’s third largest independent software supplier.
The original idea behind SAP was to provide customers with the ability to interact with common corporate databases. With just one customer and a handful of employees the company didn’t just want to transform the world of IT, but alter the way companies conducted business.
Over the past 4 decades, SAP has grown from a company that developed most of their programmes at night or during weekends, to one of world’s leading independent software providers boasting a customer count of over 404,000. Today it is arguably the most advanced ERP system on the market—and with competitors like Oracle and Microsoft Dynamics, that’s no easy achievement.
The backbone of the company’s offering is SAP ERP, which helps large businesses connect their many departments, such as Finance, Logistics, Human Resources, Warehousing and Sales. In the past, each department would have had its own ERP solution, but this would regularly cause issues due to different setups and incompatibility.
SAP managed to integrate these into one package, allowing a company to easily track and manage real-time sales, production and financial accounting throughout the entire organisation. This was done by creating various modules for each department:
- SAP Finance Accounting – This covers financial planning, accounting, risk management and compliance as well as much more.
- SAP Controlling – This facilitates the coordination, monitoring and optimisation needed to help management make key decision.
- SAP Human Capital Management – This helps streamline many HR tasks such as payroll, development, and workforce planning.
- SAP Warehouse Management – This allows businesses to manage high-volume warehouse operations and complex supply chain processes.
- SAP Sales and Distribution – This provides a complete sales management solution that starts at the quotation stage and ends with the customer being billed.
Over 40 years ago, the SAP acronym was created to show that the main focus and drive behind the company was their solutions. By continuing to highlight the systems, applications and products that have helped transform the IT landscape for businesses across the globe, the company has shown that they still retain their core focus and what they originally stood for.