In UNIX & Linux operating system, the GZIP is can be only compress a single file instead of a full folder. The TAR itself can archive multiple files but not able to compress the files. Manually, you need to TAR the files inside the folder first and then GZIP it. Please execute a below command to combine the TAR & GZIP a folder directly.
tar -cvzpf FILE-NAME.tar.gz /PATH-TO-DIRECTORY
Example
Scenario: You want to compress a folder name ABC in directory /usr/sap/ABC
# cd /usr/sap/ABC # ls test1 test2 test3 test4 test5 test6 test7 test8 test9 test10
# tar -cvzpf ABC.tar.gz /usr/sap/ABC