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SAP's applications ares based on a 3-tier architecture: the data are managed by a database server, the application functionality runs on an application server, and on the user's device runs nothing but the presentation functionality.
This architecture provides for scalability at the application layer, because SAP supports the distribution of the application workload across several application server instances, which in turn can be run on several application server machines.
However, SAP's architecture is not as scalable at the database layer, as it assumes that there is one single database server only. Therefore, in the past, when the workload was growing, at the application layer it was up to you to either replace the existing machine by a bigger one "scale up") or add an additional machine of similar size and power ("scale out") – whereas at the database layer the "scale up" approach was your only option. Oracle RAC has changed that: As for an application an Oracle RAC system looks perfectly like one single database server, the SAP application now accepts the existence of several Oracle instances running on several machines. In other words: Oracle RAC gives you all the scalability options at the database layer which you have always had on the SAP application layer.
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