System Wide Concepts Organizational Elements

A company’s enterprise structure is mapped to the SAP applications using organizational elements. The organizational elements are the mechanism for defining a company’s enterprise structure within the SAP system for legal and/or business-related purposes. Organizational elements include legal company entities, plants, storage locations, sales offices, and profit centers and may be assigned to a single application (such as Sales Organization is assigned to Sales & Distribution), or to several applications (such as Plant to Materials
Management & Production Planning).

Each organizational element, such as Plant, is first defined in the Implementation Guide (IMG) and then assigned (linked) to other organizational elements (for example, Plant to Company Code) thus representing the whole enterprise structure. When defining organizational elements, remember that they define the structure for how data is to be entered, tracked, and extracted from the SAP system.