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A
Practical Training Report
On
SAP R/3 –Human Resource (HR )
Taken at
DCM SHRIRAM CONSOLIDATED LTD
TRAINING HELD FROM
(May 21st 2009 to June 20th 2009)
Rajrani Kala & Vyavsayik Prashikshan Sansthan, Kota
Submitted to: Submitted to:
Mr. M. S. Rau Mr. R.S. Malik
(Additional General Manager) (Assist. General Manager)
Shriram Training Centre
ISD
Submitted By:
Mayank Saini
Maharishi Arvind Inst. Of Eng. and Technology, jaipur
Acknowledgement
I owe a huge debt of thanks to a large number of people without whom this
practical training of mine would not have been possible. I express my sincere
gratitude to the management of DSCL, Kota for giving me the opportunity to
get a first hand technical knowledge.
I am extremely grateful to Dr. M.S.Rau, for permitting me to take training at
their prestigious organization. I am also grateful to Mr. K.R.S. Khinchi,
without whom my training at this organization would not have been possible.
I would like to express my sincere thanks to Mr. R S Malik, Miss Neha
Sharma & all for their able guidance in the core subject matter & scholarly
suggestions, prudent admonition, effective management which made my
training process smoother. I would like to thank everyone who helped me in
every way and made me feel much better & comfortable at the training place.
Mentor: Neha Sharma
Preface
A very important element of the curriculum of an IT student is the
Practical Training. As a part of the academic syllabus of 3 year degree
course of B.Tech, each student under the Maharishi Arvind Inst. Of Eng.
And Technology, jaipur is required to undergo a practical training of 30
days after completion of VI Sem. , of the course. I underwent this training at
DSCL, Kota.
The object of this training is to provide a chance to the student to have an
insight in the practical working environment in an industry. Such type of
training helps the student to prepare herself for working in the real & practical
industry environment where she has to apply the knowledge she has taken
during the degree course. This helps the students to be more confident &
efficient when she faces the real industry after completion of her degree
course.
I take pleasure in submitting this report on “ SAP R/3 -Human Resource”. In
the present era, the ERP application software package SAP is now the
backbone of every IT/Non-IT Company.
I hope this report will give a brief idea on SAP Management at DSCL, Kota
Mayank Saini
Date:
Contents
o Acknowledgement
o Preface
o History of DSCL
o Company Profile
o History of Organization (Kota Unit)
o Enterprise Resource Planning
Preamble
Evolution of ERP
Need of ERP
Feature of ERP
Components of ERP
Implementation of ERP
Functionality in different ERP Software’s
Benefits of ERP
Suppliers of ERP
o Introduction to SAP
o Basic SAP modules
o PROGRAMMING ABAP/4
o Architecture of SAP R/3
o Quick Tour of the SAP User Interface
o Human Resource
Overview
Module of HR
Structure of Personnel Administration
Info type Group
Action hiring
HR T-codes
Payroll basics
Payroll performance
Payroll Driver
Payroll schema
Payroll relevant files
Internal tables for payroll
Period parameters
Data modifier
Payroll period
Period number
Retroactive accounting
Payroll past
Retroactive accounting limit
Retroactive accounting relevance
Retroactive accounting recognition
Status indicator
o Important points
o Conclusion
o References
HISTORY OF DSCL
Nothing can better sum up the homage paid to great philanthropist Sir Shri Ram who began as a humble worker and went on to setup one of India’s largest business houses – THE DCM GROUP. Not only did Lalaji achieve great height in business enterprise but also participated in crucial early stages of nation building. Everyone is familiar with the multiple facets industries and institutions on which he left his imprint like DCM limited, Bengal Potteries, Jay Engineering Works, Sindri Fertilizers, Lady Shri Ram College, Shriram College of Commerce, Delhi School of Economics, many sugar mills and umpteen others.
The Delhi Cloth and General Mills Co. Ltd. (DCM) was founded in 1889 with the establishment of a spinning mill at Delhi. Thereafter, the company expanded and diversified into large segments of industrial areas and played a leading role in the industrialization of India.
In 1990, to create more manageable business entities DCM Ltd. was restructured into four separate companies. DCM Shriram Consolidated ltd. (DSCL) took over 1/3rd of the businesses by merging of following units of erstwhile DCM:
Shriram Fertilizer & Chemicals, Kota - Fertilizers, Plastics, Chlor Alkali and Power.
Shriram Cement Works, Kota – Cement.
Swatantra Bharat Mills and DCM Silk Mills, Delhi – Textiles.
In decade 1990-2000 DSCL added the following units to its portfolio:
Shriram Alkali & Chemicals, Bharuch - Chlor Alkali.
Shriram Environment & Allied Services, Gurgaon – Environment and al-lied services.
Ghaghagra Sugar, Lakhimpur Kheri – Sugar.
Shriram Bioseed Ltd., Hyderabad – Seeds.
DSCL ESCO Ltd., Delhi – Energy Services Company.
Hariyali Kisan Bazar.
Fenesta Windows.
The main units of DSCl now comprise of:
Agri businesses: Sugar, Urea, Agri Inputs, Bioseeds, Hariyali Kisan Bazar.
Energy Intensive Business: Chemicals, PVT Resins, Cement.
Value Added Businesses: Fenesta Building Systems, PVC Compounds, Energy Services.
Other Businesses: Textiles.
Company Profile
DSCL is a Rupees 15.50 billion, public listed company, based in North India with a core sector business portfolio comprising fertilizers, chlor alkali, chemicals, plastics, cement, textiles and sugar.
A leading Indian organization, DSCL aspires to become a world-class enterprise that is responsive to change, outward looking, competitive, delivers superior quality at low cost, with focused businesses and robust financials.
DSCL has been built on core values of being caring, credible and fair with all stakeholders, committed to continuous improvement; and being a responsible corporate citizen.
DSCL has built an enabling work culture and believes in releasing human energy within the organization through participation, teamwork, professionalism, entrepreneurship, openness and upholding human dignity. The Company is committed to enhancing the employability of individuals through competence building via continuous training and development activities.
DSCL believes in a pro-active Industrial Relations policy and has an enviable track record in this field. Employee welfare is given utmost priority and is institutionalized across the organization.
DSCL has initiated several management initiatives in the recent past for upgrading the organization, the major ones being Institution Building, Quality Management.
ISO 9000 Certification and implementation of SAP R/3 ERP package Information Technology. The Company provides aspiring professionals opportunities to grow in a challenging and up-to-date environment. DSCL’s
recruitment policy values merit, are egalitarian, do not differentiate on the basis of sex, caste or religion, and targets the best professionals. Compensation is commensurate to qualifications, experience and ability.
HISTORY OF ORGANISATION (KOTA UNIT)
As for back in 1961 the fledgling beginning of one of the company’s biggest Chemical complex took its roots at Kota by laying the foundation stone in Vinyl and Chemical Industries which is known today as SHRI RAM FERTILIZERS AND CHEMICALS.
The company under the continuous expansion programs diversified from chemical to fertilizers and cement. Cement plant is the first of its kind in the Country and second in the world because of its Calcium Hydroxide sludge based technology instead of conventional lime stone raw material.
The chronological history of its growth is detailed below:
Year Activity
1962 The foundation stone was laid for PVC plants.
1963 Caustic soda and calcium carbide plant were put on stream.
1964 PVC plant was commissioned
1964 The foundation stone was laid for fertilizer plant
1969 Urea fertilizers plant of 70 tons/day.
1970 Power plant commissioned and inaugurated by Late Smt. Indira Gandhi
1971 The capacity of the Fertilizer plant was increased to 930 TDP.
1972 The capacity of the caustic soda plant was increased to 100 TDP.
1974 The caustic soda fusion Plant was commissioned.
1976 India’s largest 20 MV indigenous carbide furnace was commissioned.
1978 PVC Plant capacity increased to 65 TPD.
1979 The capacity of PVC Plant was increased to 100 TDP.
1984 Cement plant of 600 TDP using calcium Hydroxide waste from carbide plant was commissioned.
1984 Commissioning of bag house in calcium carbide plan and ESP for 35 MW. 1988 Power plant and cement plant for controlling the pollution.
1989 Adsorption unit for Ammonia recovery in Urea Plant
1996 Certification for compounding.
1997 Certification of Fertilizer group.
1997 Certification of Shriram Cement Work.
1997 Certification of Chloral Alkali Group.
1997 Certification of Shriram Environment and allied services.
1998 World class Enterprise wide Resource Planning (ERP software SAP R/3) implementation with best business practices.
1998 PVC compounding capacity is being increased from 75 MT/PM to 2000 MT/PM.
1999 Installation of Hydrogen bottling facility.
2000 Commissioning of 30 TPD stable balancing Power Plant.
2001 Poly Aluminum chloride Plant established. They have as many as 230 wholesalers and 463 retailers for marketing its products. It has its divisional office in all-metropolitan cities and important cities
ENTERPRISE RESOURCE PLANNING
Preamble:
Enterprise Resource Planning is the latest high end solution,
information technology has lent to business application. The ERP
solutions seek to streamline and integrate operation processes and
information flows in the company to synergies the resources of an
organization namely men, material, money and machine through
information. Initially implementation of an ERP package was possible
only for very large Multi National Companies and Infrastructure
Companies due to high cost involved. Today many companies in India
have gone in for implementation of ERP and it is expected in the near
future that 60% of the companies will be implementing one or the other
ERP packages since this will become a must for gaining competitive
advantage.
Evolution of ERP
In the ever-growing business environment the following demands are
placed on the industry:
Aggressive Cost control initiatives
Need to analyze costs / revenues on a product or customer
basis
Flexibility to respond to changing business requirements
More informed management decision making
Changes in ways of doing business
Difficulty in getting accurate data, timely information and improper
interface of the complex natured business functions have been
identified as the hurdles in the growth of any business. Time and again
depending upon the velocity of the growing business needs, one or the
other applications and planning systems have been introduced into the
business world for crossing these hurdles and for achieving the
required growth. They are:
Management Information Systems (MIS)
Integrated Information Systems (IIS)
Executive Information Systems (EIS)
Corporate Information Systems (CIS)
Enterprise Wide Systems (EWS)
Material Resource Planning (MRP)
Manufacturing Resource Planning (MRP II)
Money Resource Planning (MRP III)
The latest planning tool added to the above list is Enterprise Resource
Planning.
Need for ERP
Most organization in the world have realized that in the rapidly
changing environment, it is impossible to create and maintain a custom
designed software package which will cater to all their requirement and
also be completely up-to date. Realizing the requirement of user
organizations some of the leading software companies have designed
ERP software which will offer:
An integrated software solution to all functions of an organization.
Since ERP solutions address the entire organizational needs, and
not selected island
of the organization
ERP introduction brings a new culture, cohesion, and vigor to the
organization.
After ERP introduction the line managers would no longer have to
chase information,
check compliance, rules or conformance to budget.
ERP systems similarly would relieve operating managers of routine
decisions and
leave them with lots of time to think, plan, and execute vital long-term
decisions of an organization.
ERP systems lead to significant cost savings by continuously moni-
toring the
organizational health. The seemingly high initial investments become
insignificant in the face of hefty long-term returns.
ERP provides best business practices in the industry thus overcom-
ing shortened life
cycle which calls for continuous design improvement, manufacturing
flexibility, and
super efficient logistics control; in short a better management of the
entire
supply chain.
Features of ERP
Some of the major features of ERP and what ERP can do for the
business system are as below:
ERP facilitates company-wide Integrated Information Sys-
tem covering all functional areas like Manufacturing, Selling
and distribution, Payables, Receivables, Inventory, Ac-
counts, Human resources, Purchases etc.,
ERP performs core corporate activities and increases cus-
tomer service and thereby augmenting the Corporate Im-
age.
ERP bridges the information gap across the organization.
ERP provides for complete integration of Systems not only
across the departments in a company but also across the
companies under the same management.
ERP is the only solution for better Project Management.
ERP allows automatic introduction of latest technologies
like Electronic Fund Transfer(EFT), Electronic Data Inter-
change(EDI), Internet, Intranet, Video conferencing, E-
Commerce etc.
ERP eliminates the most of the business problems like Ma-
terial shortages, Productivity enhancements, Customer ser-
vice, Cash Management, Inventory problems, Quality prob-
lems, Prompt delivery etc.,
ERP not only addresses the current requirements of the
company but also provides the opportunity of continually
improving and refining business processes.
ERP provides business intelligence tools like Decision Sup-
port Systems (DSS), Executive Information System (EIS),
Reporting, Data Mining and Early Warning Systems (Ro-
bots) for enabling people to make better decisions and thus
improve their business processes
Components of ERP
To enable the easy handling of the system the ERP has been divided
into the following Core subsystems:
Sales and Marketing
Master Scheduling
Material Requirement Planning
Capacity Requirement Planning
Bill of Materials
Purchasing
Shop floor control
Accounts Payable/Receivable
Logistics
Asset Management
Financial Accounting
Implementation of ERP
Implementing an ERP package has to be done on a phased manner.
Step by step method of implementing will yield a better result than big-
bang introduction. The total time required for successfully
implementing an ERP package will be anything between 18 and 24
months. The normal steps involved in implementation of an ERP are
as below:
Project Planning
Business & Operational analysis including Gap analysis
Business Process Reengineering
Installation and configuration
Project team training
Business Requirement mapping
Module configuration
System interfaces
Data conversion
Custom Documentation
End user training
Acceptance testing
Post implementation/Audit support
Benefits of ERP
The benefits accruing to any business enterprise on account of
implementing are unlimited. According to the companies like NIKE,
DHL, Tektronix, Fujitsu, Millipore, Sun Microsystems, following are
some of the benefits they achieved by implementing ERP packages:
Gives Accounts Payable personnel increased control of in-
voicing and payment processing and thereby boosting their
productivity and eliminating their reliance on computer per-
sonnel for these operations.
Reduce paper documents by providing on-line formats for
quickly entering and retrieving information.
Improves timeliness of information by permitting, posting
daily instead of monthly.
Greater accuracy of information with detailed content, bet-
ter presentation, fully satisfactory for the Auditors.
Improved Cost Control
Faster response and follow up on customers
1. Initiation
6. Operations
6.Realization
5. Transition
2. Planning
3. Analysis & process design
More efficient cash collection, say, material reduction in de-
lay in payments by customers.
Better monitoring and quicker resolution of queries.
Enables quick response to change in business operations
and market conditions.
Helps to achieve competitive advantage by improving its
business process.
Improves supply-demand linkage with remote locations and
branches in different countries.
Provides a unified customer database usable by all appli-
cations.
Improves International operations by supporting a variety of
tax structures, invoicing schemes, multiple currencies, mul-
tiple period accounting and languages.
Improves information access and management throughout
the enterprise.
Provides solution for problems like Y2K and Single Moni-
tory Unit(SMU) or Euro Currency.
Suppliers of ERP
There are many numbers of ERP suppliers who are very active in the
market. Some of the companies offering renowned international ERP
products include:
Baan
CODA
D&B
IBM
JD Edwards
Marcarn
Oracle
People soft
Platinum
Ram co
SAP
SMI
Software 2000
BRIEF DESCRIPTION OF THESE SOFTWARES
Oracle: The heavyweight of the database software market, Oracle has
built a solid enterprise applications business, which accounted for $2.1
billion of the firm’s $7.9 billion revenues in 1998. Second to SAP in the
enterprise software market, Oracle applications serve over 5,000
customers in 140 countries. Oracle has been a leader in re-focusing
its ERP solutions around the Internet, and it recently launched a
version of its applications suite which is accessible from a standard
Web browser. Further, Oracle was the first JBOPS company to
integrate front-office applications with its ERP offering.
PeopleSoft: Started as a software firm for human resource
management in 1987, PeopleSoft gradually expanded its software to
cater to other corporate functions. The company’s revenues grew fast,
reaching $1.3 billion in 1998 up forty-fold from $32 million in 1992. The
firm’s most recent enterprise system, PeopleSoft 7.5, provides
enterprise solutions for finance, materials management, distribution,
supply chain planning, manufacturing, and human resources.
J.D. Edwards: Founded in 1977 by three partners from an accounting
firm, J.D. Edwards addresses business processes in finance,
manufacturing, distribution/logistics and human resources, and
encompasses the entire supply chain from planning and scheduling
through execution. Growing from $120 million in revenues in 1992 to
$934 million in 1998, the software maker has served over 5,000
customers in over 100 countries. Its flexible, technologically-advanced
One World system has been a recent success.
Baan: The Baan Company was founded in The Netherlands in 1978
making financial software. Baan’s products have been simpler to use
than SAP’s, which led to the company’s growth in the early nineties.
Today, the company operates in 80 countries, serving more than 2800
customers. Baan’s net revenues have increased from &47 million in
1992 to $747 million in 1998.baan series is its primary enterprise
system, which incorporates a variety of functionalities from sale order
management and manufacturing to supply chain management.
Choosing the right ERP package is not easy. The selection process
starts with an identification of system scope, business objectives and
business processes. Certain ERP packages provide better solutions in
certain functional areas. For example, SAP began as manufacturing
software and still excels along that dimension. Moreover, different
ERP vendors have experience in different industries, and offer
solutions that are geared to
those industries. Figure 4 summarizes the recommendations of
Benchmarking Partners’ consultants on industries that are well-served
by the different ERP packages.
Introduction to SAP
SAP the company was founded in Germany in 1972 by five ex-IBM
engineers. In case you’re ever asked, SAP stands for Systems,
Applications, and 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.
The original five founders have been so successful that they have
multiplied many times over such that SAP AG is now the third largest
software maker in the world, with over 17,500 customers (including
more than half of the world's 500 top companies). SAP employs over
27,000 people worldwide today, and had revenues of $7.34 billion and
Net Income of $581 million in FY01. 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 44,500 installations of SAP, in 120 countries, with more
then 10 million users!
So 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 3,000 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.
SAP R/3 is delivered to a customer with selected standard process
turned on, and 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.
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. All of these modules are tightly
integrated which – as you will find out – is a huge blessing ... but brings
with it special challenges.
SAP Modules
R/3's applications are modules. They can be used either alone or
combined with other solutions. The integration capability of these
applications increases the benefits derived for any company.
Logistics
Logistics comprises all processes involved in purchasing, materials
management, manufacturing, warehousing, quality management, plant
maintenance, service management and sales and distribution. All
applications access a shared consistent database, supported by
production data management.
SD: Sales & Distribution SD actively supports sales and
distribution activities with outstanding functions for pricing, prompt
order processing, and on-time delivery, interactive variant
configuration, and a direct interface to profitability analysis and
production.
PP: Production Planning and Control PP provides
comprehensive process for all types of manufacturing: from repeti-
tive, make-to-order, and assemble-to-order production, through
process, lot and make-to-stock manufacturing, to integrated supply
chain management with functions extended MRP || and electronic
kanban, plus optional interfaces to PDC, process control systems,
CAD and PDM.
Production Planning and Control
PS: Project System PS coordinates and controls all phases of a
project, in direct cooperation with Purchasing and Controlling,
from quotation to design and approval, to resource management
and cost settlement.
MM: Materials Management MM optimizes all purchasing pro-
cesses with workflow-driven processing functions, enables auto-
mated supplier evaluation, lowers procurement and warehousing
costs with accurate inventory and warehouse management, and
integrates invoice verification.
QM: Quality Management QM monitors, captures, and man-
ages all processes relevant to quality assurance along the entire
supply chain, coordinates inspection processing, initiates correc-
tive measures, and integrates laboratory information systems.
PM: Plant Maintenance PM provides planning, control, and pro-
cessing of scheduled maintenance, inspection, damage-related
maintenance, and service management to ensure availability of
operational systems, including plants and equipment delivered to
customers.
SM: Service Management SM provides highly integrated cus-
tomer service functionality to compete in today's global markets.
PDM: Product Data Management PDM supports in creating and
managing product data throughout the product life cycle.
Financials
Financials is a suite of integrated financial application components
encompasses all aspects of financial accounting, investment
management, controlling, treasury management, and enterprise
controlling.
FI: Financial Accounting FI collects all the data in company rel-
evant to accounting, providing complete documentation and com-
prehensive information, and is at the same an up-to-the-minute
basis for enterprise-wide control and planning.
CO: Controlling CO is a complete array of compatible planning
and control instruments for company-wide controlling systems,
with a uniform reporting system for coordinating the contents and
procedures of company's internal processes.
IM: Investment Management IM offers integrated management
and processing of investment measures and projects from plan-
ning to settlement, including pre-investment analysis and depre-
ciation simulation.
TR: Treasury TR is a complete solution for efficient financial
management that ensures the liquidity of worldwide company, its
structures, financial assets, profitability and minimizes risks.
EC: Enterprise Controlling EC continuously monitors com-
pany's success factors and performance indicators on the basis
of specially prepared management information.
Financial Information Flow
FI Features
Strong control capabilities and audit support
Multi-currency/multi-national
Online budgeting/planning
Supports country-specific requirements
Real-time daily world-wide p&L reporting
Activity-based costing
World-wide assets management
Inter-company consolidations
Support for transfer pricing logic
Complete integration with other modules
Human Resources
HR provides solutions planning and managing company's human
resources, using integrated applications that cover all personnel
management tasks and help simplify and speed the process.
PM: Personnel Management PM is a complete solution for per-
sonnel administration, recruitment management, travel manage-
ment, benefits administration and salary administration.
OM: Organizational Management OM assists in maintaining an
accurate picture of organization's structure, no matter how fast it
changes. It is systematic and forward planning tool that considers
the final effects of all personnel events thus it's complete solution
for personnel cost planning.
PA: Payroll Accounting PA addresses payroll functions from a
global point-of-view and gives the capability to centralize payroll
processing or decentralize the data based on country or legal en-
tities.
TM: Time Management TM is integrated with payroll accounting,
controlling, production planning, plant maintenance, project sys-
tem, external services and shift planning. It provides with a vari-
ety of standard reports that will assist in tracking and analyzing
employee time with completeness and accuracy.
PD: Personnel Development PD assists with planning, monitor-
ing, and analyzing scheduled seminars, training courses, and
business events, registration and booking, price determination
and invoicing.
PROGRAMMING ABAP/4
ABAP/4 is the programming language used by SAP’s developers to
build the transactions that make up the R/3 application. It’s also used
by corporations to customize the R/3 application. In general, ABAP/4
isn’t used by customers of SAP to develop complex applications from
scratch, but instead to provide additional business functionality. For
example, it’s not necessary for a customer to write a program in
ABAP/4 to manage inventory levels, because SAP has already written
transactions to accomplish this objective.
The two most common uses for ABAP/4 are producing custom reports
and developing custom interfaces for SAP. In this context, a report is
an ABAP/4 program that reads specific data from SAP’s database and
then displays the data via a computer screen or a printed page. An
interface, on the other hand, is an ABAP/4 program that moves data
into SAP, or reads data from SAP and writes it out to a system file to
be transferred to an external computer system, such as a legacy
mainframe. Other uses for ABAP/4 include conversion programs that
change data into a format usable by SAP, and custom transactions
similar to the SAP transactions that make up the R/3 application, but
are written by users to fulfill some business function not provide by
SAP.
HOW ABAP/4 AND DATA INTERACT IN SAP
Almost all ABAP/4 programs manipulate data from the SAP database
to some extent. Data manage by SAP is often broken into two cate-
gories: master data and transactional data (called documents in SAP):
Master data is information that usually corresponds to physical
objects, such as materials, vendors, customers, or plants.
A document is information that usually corresponds to an event
such as a purchase order, an invoice, a change in inventory, or a
sales order. Documents can be identified in the system by a
document number, which can be externally assigned or assigned
by SAP, depending on the configuration.
Master data is needed in order to create any document; for example,
an invoice can’t be created without a vendor to issue it. A change in
inventory, referred to in SAP as a material movement, must refer to a
material and a plant. Each SAP module has master data that it
manages and documents that are created in the course of normal
business operations. For example, the FI module, which manages
finances and accounting, manages master data such as general ledger
accounts and documents such as journal entries and check payments.
Linking SAP R/3 to Other Applications: BAPIs
SAP does not solve everything. For example, the firm s forecasting or
customer relationship management processes may not be modeled
within SAP. Where SAP does not provide a solution, it is possible to
bolt-on another application to attain the required functionality. SAP has
an open, component-based architecture that enables integration with
other applications. This architecture consists of two key elements:
1. SAP Business Objects are essentially black boxes that contain
SAP R/3 data and business processes, while suppressing the details of
their data structure or specific implementation details, and
2. BAPIs (Business Application Programming Interfaces) define how
the application links to SAP R/3.The result is a standard method of
communication between SAP R/3 and other applications. Business
Objects are the business-application versions of real-world entities,
such as a sales order or an employee. The core of the business object
is the actual data (for instance, an employee s name and id number.)
The interface is a set of clearly defined
methods, each specifying what operations can be performed on this
data (including the possibility of altering it).
Architecture of SAP R/3
The R/3 Basis system is a multi-tier client/server system. The
individual software components are arranged in tiers and function,
depending on their position, as a client for the components below them
or a server for the components above them. The classic configuration
of an R/3 System contains the following software layers:
Database Layer
The database layer consists of a central database system containing
all of the data in the R/3 System. The database system has two
components - the database management system (DBMS), and the
database itself. SAP does not manufacture its own database. Instead,
the R/3 System supports the following database systems from other
suppliers: ADABAS D, DB2/400 (on AS/400), DB2/Common Server,
DB2/MVS,INFORMIX, Microsoft SQL Server, ORACLE, and ORACLE
Parallel Server.
The database does not only contain the master data and transaction
data from your business applications, all data for the entire R/3 System
is stored there. For example, the database contains the control and
Customizing data that determine how your R/3 System runs. It also
contains the program code for your applications. Applications consist
of program code, screen definitions, menus, function modules, and
various other components. These are stored in a special section of the
database called the R/3 Repository, and are accordingly called
Repository objects. You work with them in the ABAP Workbench.
Application Layer
The application layer consists of one or more application servers and a
message server. Each application server contains a set of services
used to run the R/3 System. Theoretically, you only need one
application server to run an R/3 System. In practice, the services are
distributed across more than one application server. This means that
not all application servers will provide the full range of services. The
message server is responsible for communication between the
application servers. It passes requests from one application server to
another within the system. It also contains information about
application server groups and the current load balancing within them. It
uses this information to choose an appropriate server when a user logs
onto the system.
Presentation Layer
The presentation layer contains the software components that make up
the SAPgui (graphical user interface). This layer is the interface
between the R/3 System and its users. The R/3 System uses the
SAPgui to provide an intuitive graphical user interface for entering and
displaying data. The presentation layer sends the user’s input to the
application server, and receives data for display from it. While a SAP
GUI component is running, it remains linked to a user’s terminal
session in the R/3 System.
Quick Tour of the SAP User Interface
The SAP R/3 system presents a Windows interface with several of the familiar Windows functions for screen manipulation. The apparent simplicity of the interface hides the power of the menus residing within the menu bar at the top of the screen. The initial screen shows a menu bar with the following selections. The first level sub menus are listed below to give you an idea of where to start:
Office Workplace Telephone Integration Appointment Calendar Room Reservations Start Workflow Business Documents
Logistics Materials Management Sales/distribution Logistics Execution Production Production-process Plant Maintenance Customer Service Quality Management Logistics controlling Project Management Environment Health & Safety Central Functions
Accounting Financial Accounting Treasury Controlling Enterprise Control Investment Mgt. Project management Real Estate
Human Resources Managers Desktop Personnel admin. Time management Payroll Training and Event Management Organizational Management Travel Information system
Information Systems Executive Information Systems Logistics Accounting Human Resources Project System Ad Hoc Reports General Report System
Tools ABAP/4 Workbench Accelerated SAP Administration ALE Business Communication Business Documents Business Framework Business Workflow CCMS Web Development SAP Script Hypertext Find
HUMAN RESOURCE
(HR Module)
Overview:
Human Resource is a complete integrated system for supporting
the planning and control of personnel activities. The Human Resources
modules provide an integrated human resources management system,
covering personnel planning and recruitment, personnel and salary ad-
ministration, payroll and personnel development.
HR provides solutions, planning and managing company’s hu-
man resources using integrated applications that cover all personnel
management task and helps to simplify and speed the process.
Modules of Human Resource (HR):
Personnel management (PM): PM is the complete solution for per-
sonnel administration, recruitment management, travel management,
benefits administration and salary administration.
Organizational Management (OM): OM assist in maintaining an accu-
rate picture of organization’s structure, no matter how fast it changes. It
is systematic and forward planning tool that considers the final effects
of all personnel events. Thus it is a complete solution for personnel
cost planning.
Payroll Accounting (PA): PA addresses payroll functions from a
global point of view and gives the capability to centralize payroll pro-
cessing or decentralize the data based on country or legal entities.In
DSCL payroll functions as:
Time Management (TM): TM is integrated with payroll accounting,
controlling, production planning, plant maintenance, project system,
external services and shift planning. It provides with the variety of stan-
dard reports that will assist in tracking and analyzing employee time
with completeness and accuracy.
Release Payroll
Start Payroll
Exit Payroll Corrections
Subsequent action Payroll
Change the Master data
Run OK?
No
Yes
Personnel Development (PD): PD assist with planning, monitoring
and analyzing scheduled seminars, training courses, business events,
registration and booking, price determination and invoicing.
Structure of Personnel Administration:
Administrative perspective
For giving the definition of organization from the administrative
control perspective we define the following terms:
Personal Area: Division of company into sub units based on geo-
graphical ares or administrative units. For eg in DSCL, SFC KOTA,
Corporate office etc.
Personal Sub Area: Sub division of personal areas into depart-
ments or employee work centre.
Organization perspective
Employee Group: It is based on the category of employ-
ment. For eg regular, seasonal, temporary.
Employee Sub Group: It is the sub classification of employee group
into various grades of employment. For eg Vice President, Sr. Man-
ager, Asst Manager etc.
Payroll Area: Groups of employees for whom the payroll is
executed at one point of time. For eg Workmen, Managers Etc.
Info type group
Definition: An info type group or info group is a sequence of re-
lated info type that is displayed one after the other for maintenance
purposes when a personal action is performed.
Usage: The info group guarantees that during the personal action
all information needed for the business process is stored.
Personal Data (Info type 0002)
This info type stores data for identifying an employee.
Addresses (Info type 0006)
In this we store the address data of an employee. It contains the
following addresses:
Subtype 1: Permanent residence
Subtype 2: Temporary address
Subtype 3: Home address
Subtype 4: Emergency address
Subtype 5: Mailing address
Bank details(Info type 0009)
Enter the payee for the net pay or the travel expenses from the
payroll and the bank details. The standard contains the bank details
type:
Subtype 0: Main bank
Subtype 1: Other bank details
Subtype 2: Travel expenses
Personal Action (Info type 0000)
Personal actions simplify the administration of complex person-
nel procedures, such as hiring a new employee. It can perform:
Hire an employee
Change the organizational assignment of an employee.
Change an employee’s pay
Set an employee’s status to early retiree or pensioner
Document when an employee leaves or reenters an enterprise
Basic Pay (Info type 0008)
We can store the employee’s basic pay in this info type. We can
get an overview of the employee’s payroll history using the info type
history. Standard system contains the following reference types:
Subtype 0: Basic contract
Subtype 1: Increase main contract
Subtype 2: Comparable domestic pay
Subtype 3: Refund of the costs in foreign currency.
Organization Assignment (Info type 0001):
The organizational assignment info type deals with the incorpora-
tion of the employee into the organizational structure and the personal
structure. The data is very important for the authorization and control of
payroll.
Education (Info type 0022)
We can store what education and training qualifications an em-
ployee or an applicant has passed in this info type.
Action hiring
This action is performed by filling a form which has a path as:
Human Resources—Personnel Management—Administration—HR
master data—PA 40 (personal action)
To maintain the data for an employee
Enter personnel no.
Enter the info type no.
Enter the sub type
Enter the start and the end dates.
HR TRANSACTION CODES (T-Codes)
PA10: Personnel file
PA20: Display HR data
PA30: Maintain HR master Data
PA40: Personal events
PA41: Change hiring data
Payroll Basics (PY – XX – BS)
Purpose: The payroll is based on an international payroll driver.
This payroll driver was modified for each country. The country- specific
payroll drivers take the statutory and administrative regulations of a
country into account.
Process Flow: When you access Payroll, the payroll driver calls
the accompanying payroll schema, which consists of a sequence of
functions. For each activity, the individual functions import data from in-
ternal tables and payroll relevant files.
Payroll performance
The system updates the database and imports the master data rele-
vant to payroll.
If Off-Cycle Payroll is to take place, the system deletes the internal
table IT.
The system imports the last payroll result.
The system calculates the gross wage and considers the shift
schedule, shift change compensation and valuation bases. Any master
data relevant to payroll is included in the calculation at this point.
The system calculates the partial period factors, lump-sums and
salary elements and cumulates the gross results.
The system calculates the net remuneration and performs retroac-
tive accounting if specific master data has been changed in previous
payroll periods.
Results: After the payroll run, we can transfer the payroll results
to financial accounting, or perform evaluation and create list and statis-
tics.
Payroll Driver
Definition: Program which is used to run payroll.
Structure: For each payroll country version there is a country
specific payroll driver with a technical name RPCALCx0 or HxxCALC0.
For programs with the technical name RPCALCx0 the x is replaced
with the country indicator. For eg D for Germany, F for France or X for
other countries.
For programs with the technical name HxxCALC0 the xx is re-
placed with the ISO code of the respective country. For e.g. MX for
Mexico or ID for Indonesia.
The program RPCALCx0 (payroll driver international) contains no
data about tax and social insurance regulations for net remuneration
calculation. The other payroll drivers contain this data.
Payroll Schema
Definition: The payroll schema contains calculation on rules to
be based by the payroll driver during payroll. SAP has developed
country specific schemas which are based on schema X000. With
country-specific reports, the first character in the name refers to the
country indicator. For e.g. D for Germany and F for France.
Structure: A schema consists of following parts:
Initialization: System performs the following steps:
Update the databases
Imports required Info types
Gross calculation of pay.
Then system performs the following steps:
Processes basic data and time data
Queries off-cycle payroll runs
Reads payroll account of the last period accounted
Processes time data and calculates individual gross values
Performs factoring
Net calculation of pay.
Then system performs the following steps:
Calculates net remuneration
Performs bank transfers
Payroll Relevant Files
Definition: A payroll file contains data for payroll and payroll re-
sults.
Structure: The system requires the following files for payroll:
Pnnn (nnnn = number of the info type): The Pnnnn files
contain data that has been entered in the respective info types for an
employee.
PCL1: The PCL1 file contains primary information, in order
words, data from the master data and time recording systems.
PCL2: The PCL2 file contains the secondary information, in
other words derived data and all generated schema.
Internal Tables for Payroll
Definition: Tables that are used for storing data during the pay-
roll run.
Use: Within payroll, data is processed in internal tables that the
system files reads during the payroll run. The system also changes the
data in these tables during the payroll run. The results of processing
are then available for other steps.
The read and change access to these tables is enabled using
functions that are executed in a personnel calculation schema and us-
ing operations that are executed in personnel calculation rules.
Period Parameters
Definition: A two-digit parameter that determines the interval for
which the payroll is run for payroll area. If we assign period parameter
01 to the salaried employee area, payroll runs each month for the pay-
roll area. If we assign period parameter 03 to the industrial employee
payroll area, payroll runs each week for the payroll area.
Use: The standard SAP R/3 system contains period parameters
for all the payroll periods that are commonly used in various countries.
If we need our own period parameters in our system specify it in cus-
tomizing for payroll by Choosing Basic setting payroll organization and
define period parameters.
To assign just one period parameter to each payroll area in our
system, access customizing for payroll and choose basic settings pay-
roll organization check payroll area. In this way we can determine how
the regular payroll runs for this payroll area. We can run assign the
same period parameter to all payroll areas if the payroll periods are the
same for all the employees. We can run report RPUCTP00 (generation
of payroll periods) in our system to generate payroll periods for every
period parameter that we have assigned to a payroll area. In this way
we determine the concrete start and end date and the pay day for each
period. We generate by accessing the customizing for payroll and
choosing basic settings payroll organization generate payroll periods..
Data modifier
Definition: A distinguishing feature that enables us to specify dif-
ferent pay days for different employee groups for which payroll runs
with the same periodicity. Payroll runs on a monthly basis at our enter-
prise. The payday is 15th of the month for industrial employees and 25th
of month for salaried employees. The payroll periodicity is the same for
both employee groups so the system requires two date modifiers as
distinguishing features in order to determine different paydays.
Use: If we require date modifiers, specify them in customizing for
payroll by choosing basic settings payroll organization define date
modifiers. We assign the date modifier to every payroll area in our sys-
tem by accessing customizing for payroll by choosing basic setting
payroll organization check payroll area.
If we use the same payday for all payroll areas, assign the SAP
standard modifier to all payroll areas. If we use different paydays for
different payroll area, assign different date modifiers created for our
enterprise to these payroll areas.
We must run report RPUCTP00 (generation of payroll periods) in
our system to generate payroll tolls separately for each combination of
period parameter and date modifier that we assign to a payroll area.
We generate by accessing customizing for payroll by choosing basic
settings payroll organization generate payroll periods.
When we start payroll and the payroll driver selection screen is
displayed, enter the payroll area for which payroll must run. Using the
date Modifier that we assign to this payroll area, the system deter-
mines whether the different date specifications exist for the payroll
area.
Payroll period
Definition: The period for which payroll regularly runs. In an ab-
stract sense, payroll period is the name given to the interval for which
the payroll regularly runs, such as weekly or monthly payroll periods.
Specifically the payroll period is an interval from a start date to end
date. For e.g. the monthly payroll period from Oct 1st to Oct 31st.
Use: We specify concrete payroll period for our enterprise, each
with a period no, start date, end date and payday in customizing for
payroll by choosing basic setting payroll organization generate payroll
periods and running report RPUCTP00 (generation of payroll periods).
The generation of payroll periods is dependent on the period parame-
ter and date modifier. The report enters the start and end date of every
payroll period in the table T549Q (payroll periods), and the payday in
the table T549S (personnel date specification per payroll period).
The system automatically creates the payday for all countries
when we generate the payroll periods, however the payday only has a
role to play in some countries. This is the case if for eg the transfer
date of original payroll runs (as opposed to retroactive runs) are rele-
vant to taxation.
When we start payroll and the payroll driver selection screen is
displayed, enter the payroll area for which the payroll must run. Using
the payroll control record of this payroll area, SAP R/3 determines the
next period for which the payroll must run.
The procedure is as follows:
The system reads the current value that is contained in the pay-
roll period field of the payroll control record.
Using this value, it reads the previous payroll period field in table
T549Q (payroll period).
It determines which period follows this previous period in accor-
dance with table T549Q. The subsequent period is the current payroll
period.
The system also determines the concrete start and end date of
the current payroll period using the same table..
Period number
Definition: A two digit numerical parameter that together with the
date clearly identifies a concrete payroll period. The period number 08,
together with the year 2000, denotes the eighth payroll period in the
year 2000. It can depend on the system settings. For e.g. the calendar
month August or the week from 14th through 20th Feb.
Use: In the payroll control record, the system continuously in-
creases the period numbers of the payroll periods for a fiscal year. Ev-
ery time you set the status of the payroll control record to release the
payroll, the period number is increased by one. In this way the system
identifies the current payroll period. At the start of a new fiscal year the
period number is reset to 01. The period number that a payroll period
contains depends on the following criteria that you enter when generat-
ing the payroll periods.
Period parameter (for example, weekly or
monthly)
Start of fiscal year
In most countries the fiscal year starts on 01 January. However, it
starts on 6th April in the United Kingdom.
Indicator for determining the period number
This indicator specifies the payroll period date the system should use
to determine the period number.
Start date
End date
Payday
Retroactive Accounting
Use: If you change the master and time data of an HR master
record for a payroll period for which the payroll has already run, the ex-
isting payroll results must be rechecked during the next regular payroll
run and then included in the payroll again. The system automatically
performs retroactive accounting for the payroll past.
To prevent all changes from triggering a retroactive accounting
run, changes are check from retroactive accounting relevance. This
ensures that retroactive accounting is only triggered by changes that
require a correction of the payroll results.
Retroactive changes in customizing do not trigger retroactive ac-
counting. To force retroactive accounting for personnel numbers use
the Forced Retroactive Accounting as a field on the selection screen of
the payroll program.
Scope of function: The retroactive accounting run is restricted
by basic data.
Payroll Past
The payroll past includes all payroll periods for which you have
already run and exited payroll.
Retroactive Accounting Limit
We can determine a common retroactive accounting limit for all
employees assigned to particular payroll area, and then determine a
more recent retroactive accounting date for individual employees. The
employee’s absolute retroactive accounting limit is his hiring date.
The retroactive accounting limit determines the exact up to which
we may change master and time data in the payroll past and up to
which the system can perform retroactive accounting.
We can change the retroactive accounting limit as:
For an employee by using the Earl.pers.RA date (earliest personal
retroactive accounting date) field in info type 0003 payroll status.
For a payroll are by using the earliest possible retroactive account-
ing period field in the payroll control record (see Change Earliest Pos-
sible Retroactive Accounting Period).
The system uses the following values to determine the retroactive ac-
counting limit:
For each payroll area, the system uses the earliest possible
retroactive accounting period that is stored in the corresponding payroll
control record.
For each employee, the system uses the earliest possible retroac-
tive accounting date that is stored in the Payroll Status info type
(0003).
For each employee, the system uses the hiring date of employee.
The system uses these values to select most recent date. For e.g. de-
termining the retroactive accounting limit.
Retroactive Accounting Relevance
We can determine retroactive accounting relevance per info type
or per info type field. To determine which info types or fields are rele-
vant to retroactive accounting, access Customizing for Personnel Ad-
ministration and choose Customizing Procedures Info types Define
Retroactive Accounting Relevance.
If we edit info types that are relevant to retroactive accounting,
we must take note of some particular details. For e.g. Processing Pay-
roll-Relevant HR Master Data.
Retroactive Accounting Recognition
It consists of:
If we edit an info type that is relevant to the retroactive account-
ing, the system enters the start date of change info type record
in the following field of info type 0003 payroll status:
Earliest MD change (Earliest Master Data since last payroll run)
MD chng.bonus (earliest payroll relevant master data
change (bonus)). This field is only displayed for specific
country groupings; it is not displayed for all personnel
numbers.
During the next regular payroll run or correction run (off cycle
payroll type B), the system determines whether the date in the
earliest MD change and (if applicable) MD chng.bonus fields
come before the date in the Accounted to field.
If this is the case, the system performs retroactive accounting. It
starts with payroll period in which the date entered in the Earli-
est MD change and MD chng.bonus fields occurs. The system
recalculates all payroll periods that lie between the date in the
earliest MD change and MD chng.bonus fields and the date in
the accounted to field.
Status Indicator
Definition: Distinguishing feature of payroll results with the same
for-period.
Use: The system assigns a status indicator of each payroll result.
If a payroll result is no longer up to date because retroactive account-
ing was performed, it is not deleted. Instead, it is assigned a different
status indicator by the system.
Structure: There are three different status indicators:
A for the current result
P for previous result
O for all other results.
IMPORTANT POINTS
As we open the SAP LOGON we are asked following things:
Primary configuration considerations:
Client, company and company code
Once a business has decided to use SAP, there are several
Configurations prerequisite steps that must be completed. Determining
the organizational structure is one of the first steps in setting up the
business functions in SAP as well as your reporting requirements.
The Organizational structure is created by defining the
organizational units consisting of the following:
Client
Company
Company Code
Business Area
A Client is the highest unit within an SAP system and contains
Master records and Tables. Data entered at this level are valid for all
company code data and organizational structures allowing for data
consistency. User access and authorizations are assigned to each
client created. Users must specify which client they are working in at
the point of logon to the SAP system.
A Company is the unit to which your financial statements are
created and can have one to many company codes assigned to it. A
company is equivalent to your legal business organization.
Consolidated financial statements are based on the company’s
financial statements. Companies are defined in configuration and
assigned to company codes. Each company code must use the same
COA (Chart of Accounts) and Fiscal Year. Also note that local currency
for the company can be different.
Company Codes are the smallest unit within your organizational
structure and is used for internal and external reporting purposes.
Company Codes are not optional within SAP and are required to be
defined. Financial transactions are viewed at the company code level.
Company Codes can be created for any business organization whether
national or international. It is recommended that once a Company
Code has been defined in Configuration with all the required settings
then other company codes later created should be copied from the
existing company code. You can then make changes as needed. This
reduces repetitive input of information that does not change from
company code to company code as well as eliminate the possibility of
missed data input.
When defining company codes, the following key areas must be
updated:
Company Code Key- identifies the company code and consists of
four alpha-numeric characters. Master data and business transactions
are created by this key.
Company Code Name- identifies the name of the business organi-
zation within your organizational structure.
Address- identifies the street address, city, state, zip code for the
company code created. This information is also used on correspon-
dence and reports.
Country- identifies the country to which your business is based.
Country codes within SAP are based on ISO Standards.
Country currency- identifies the local currency for the company
code that you have defined.
Language- identifies the language to be used for you company
code and is also used for text in your documents. SAP unlike other ap-
plications, offers over thirty languages including EN( English) , ES
(Spanish), FR (French), DE (German), EL (Greek), IT(Italian), AR( Ara-
bic), ZH (Chinese) , SV (Swedish) , and JA (Japanese) to name a few.
CONCLUSION
In the present era ERP application software package SAP R/3
has now become the backbone of every manufacturing company and
all other IT initiative firms.
SAP has typically focused on the best practice methodologies for
driving its software processes, but has more recently expanded into
vertical markets. In these situations, SAP produces specialized
modules geared towards a particular market segment, such as utilities
or retail.
By specializing in software development, SAP hopes to provide a
better value to corporations than they could if they attempted to
develop and maintain their own applications.
DSCL has embarked on a number of initiatives to continuously
improve itself to respond to the increasing competitive environment
and transform into the world class Indian organization.
REFRENCES
www.dscl.com
www.planetsap.com
www.mysap.com
www.wikipedia.com
www.thespot4sap.com
dsclnet (intranet of DSCL)
