SAP Organizational Structure

To understand any ERP and its functions, its very important to understand its organizational structure. SAP Organizational structure includes high level hierarchy for an organization.

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Basic Organizational Structure for SAP FICO is as below:

Operating concern >Controlling area >Company code > Sales Organizations /Plants/ PurchaseOrganizations

This is the basic organizational structure in SAP. It is true for FICO as well other modules such as Sales and Distribution (SD), Material Management (MM) and Financial Supply Chain Management (FSCM) as well.

SAP Organizational Structure

Operating Concern is the level where strategic planning designed for the organization. An organization’s strategic planning decided in operating concern. Controlling area gets assigned tooperating concern. Operational concern can be assigned to more then one controlling areas.

Controlling area maintains management accounting. Controlling area in SAP organizational structure is the main entity in controlling organizational structure. Company code gets assigned to controlling area. More then one company codes can use a single controlling area.

Company code is a separate legal entity for legal reporting. Company code is useful for reporting, balance sheet , profit and loss statements and cash flow statements. Plants, sales organizations and purchase organizations gets assigned to Company code.

Sales organization and purchase organizations are under sales and purchase departments simultaneously. Sales organization control sales activities such as sales offices, sales persons, etc. Purchase organization controls activities under purchase planning.Both sales and purchaseorganizations assigned to company codes.

Plants assigned directly to company codes. Plants are assigned to both company codes and sales organizations.

These were the basic structure of SAP Organizational Structure.