With ALE companies get the opportunity to improve business performance and to solve organizational or technical issues.
Through distribution you can decentralize your business, enabling local units to operate independently from each other. This flexibility enables the local units to return better business results than in a centralized environment. They have the necessary flexibility to optimize business processes in different organizational units and can ensure that information systems can handle the speed of change in rapidly expanding markets. Distribution allows a high level of freedom, provided that this level of freedom has been clearly defined.
On the other hand, some companies, that already have a distributed organization with different computer systems in the local units, have the opportunity to link their units through ALE business processes. This enables them for example to provide a 'one face to the customer' approach. Another area that can benefit through ALE are virtual organizations (partnerships between independent companies, joint ventures and mergers and acquisitions).
Of course, in many cases an integrated solution based on a single system is not possible at all. Some applications used by a company can not run on the same computer system. This includes legacy systems or complementary software. It may also be possible that a company uses different SAP industry solutions or specific country solutions, which do not run on the same SAP System. If these applications run on different systems they can not be linked by a central database but have to use a special integration mechanism like ALE. In this way ALE also links SAP Core Systems to other SAP components like CRM, Business Information Warehouse or APO. Besides the benefits of having an improved flexibility in setting up the whole business processes, ALE may also reduce costs, in particular costs of upgrading. If the whole business is run on one integrated system you have to upgrade the whole system, even if only one part of your company (e.g. human resources) requires an update. So the entire company is affected by the upgrade project and all users have to be trained for the new release. Within a distributed environment with release independent interfaces, like those provided by ALE, you can focus the upgrade project on that part of the company that has to be upgraded. The other parts of the company are not involved and need no training. This can save a lot of money. Furthermore, existing investments are protected.
Another cost factor for distribution might be communication costs. For an overseas connection it can be more expensive to provide online access to one central system (T1) than to connect distributed systems to each other.There might also be some technical reasons for distributed systems. If some parts of the business have special requirements for security of data access (e.g. human resources), this can be set up much safer on a standalone system, which is, however, linked to other parts of the company through distributed business processes. A similar example is high availability. High availability is usually required by the operations part of the company (production, logistics) but not by other areas (e.g. financials, human resources). In a distributed nvironment high availability can be set up for specific parts of the environment instead of for the whole business. This can also reduce costs. In a distributed environment you can not decrease the overall workload of the systems but you can separate the user workloads on different systems. Through this scalability you can improve performance. Another benefit of distributed systems is that if a technical failure occurs on one system, all other systems continue to operate. Only a small part of the business is disrupted by the error. On one central system such an error would disrupt the entire business.