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Configure RFC Destination

In the TCODE SWU3, the first item "Configure RFC Destination", can any one explain what it is used for? and in what circumtances, we should use it?

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SAP Workflow communicates with "itself" using a logical RFC Destination called WORKFLOW_LOCAL. This initial step in SWU3 creates this RFC Destination with the (recommended) userid WF-BATCH, and which should have SAP_ALL access.

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