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SAP Tips

Mr. Santosh Karkhanis, the author of this site is implementing SAP worldwide since 1994 with big consulting firms for Multinational companies. He is specialized in helping 'Business Transformation' using SAP as a 'tool'. He is giving tips on SAP implementation & utilization in this section.

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Cost of SAP

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SAP R/3 implementation involves the following costs

  • SAP R/3 Cost of Hardware
  • SAP R/3 Cost of software
  • Cost of add-on software & hardware like bar-coding equipments for SAP R/3.
  • Cost of SAP R/3 Implementation process
  • Cost of Training of SAP R/3 operators
  • Cost of maintaining the SAP R/3 system
  • Lost opportunity costs due failure of the SAP R/3 system, if any.
  • Cost of periodical upgrading of the SAP R/3 system

SAP R/3 Cost of Hardware:

SAP R/3 requires servers as well as personal computers for end-users. As it is a real time environment, good network connection from end-users to the server is also necessary.  

SAP R/3 Cost of Software:

SAP R/3 software is patented and needs to be bought from SAP AG, Germany.  


Cost of Add-on SAP R/3 Hardware & Software

It may be necessary to use add-on hardware and software like barcode scanners to SAP. Some companies found few SAP processes (like MRP) unsuitable to their use and decided to go for other softwares available in the market for the process & integrated the softwares with SAP R/3.


Cost of SAP R/3 implementation process:

This cost consists of

  • Cost of expert help.
  • Cost of own resources to work with experts
  • Training of personnel
  • System testing
  • Documentation
  • Loss of opportunity (production/services) during go-live period


Cost of SAP R/3 training:

Though this cost is high during go-live period, it is on-going cost.


Cost of SAP R/3 maintenance:

The system has to be maintained for any bugs/additional requirements. Trained personal must available for the maintenance.


Lost opportunity cost due to failure of the SAP R/3 system

Being an integrated system, the downtime of the system can prove very expensive. Proper maintenance is required to keep up-time high.


Cost of periodical upgrading of the SAP R/3 system:

SAP R/3 is a continuously evolving system. SAP is realizing new versions every few months. To get maximum benefit of SAP, the system must be upgraded periodically.


Supply Chain Improvement - Role of Human Intellegence
One day training By Mr. Santosh Karkhanis
The Business Transformation Guru 

Date: Friday 19th February 2015  9:30am - 5:00 pm
Venue: CII Naoroji Godrej Centre of Manufacturing Excellence,
           Godrej Station-side Colony, 
           Opposite Railway Station,
           Vikhroli (East), 
           Mumbai - 400 079 India



We consult in

  • 'Beyond Analytics' : Ensuring sustained business value from SAP / ERP implementations
  • Project Management expert support for SAP implementations
  • Process Improvement in Supply Chain : Reduction in inventory, Reduction in processing cycle time, Rejectin/rewoek control etc.
  • Soft Skills Training : Problem Solving, Project Management, Customer Orientation, Goal Orientation etc

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