Successor to SAP ECC, S4/HANA is the latest version of SAP’s ERP that was released in 2015. Presented as an ERP with In Memory technology and artificial intelligence integration, it has become an interesting option for companies that want to maintain or even create a competitive advantage.
But this option became a necessity when the German firm announced that it would stop maintenance on SAP ECC from 2027 (with the possibility of extension for an additional fee until 2030). While this decision was criticized, many companies decided to migrate, even though it is often seen as a long and complex process.
Why Migrate to S4/HANA?
S4/HANA is the most recent version of SAP’s ERP. Unlike its predecessors, it is designed to run on-premises but is also perfectly adapted to the Cloud on which all its modules can run optimally.
What are the Differences between S4/Hana and SAP ECC?
SAP Hana: This is perhaps the most important difference with SAP ECC, which works with an external database. We talk about in-memory technology. The Hana revolution lies in the fact that it can track information, data, and transactions in real-time without consuming as much capacity as more traditional databases. Indeed, it uses RAM which increases the speed of information processing and storage capacity. Thus, it is interesting to migrate to SAP S4Hana because this system allows an acceleration of the performances and visibility in real-time.
The choice of installation: as we mentioned above, S4/Hana can be deployed in three different ways: on-site (the only possibility of SAP ECC), in the Cloud, and even in hybrid. This shows a real desire to adapt to each company in order to offer them a quality service.
A better user experience: all S4/Hana applications run on SAP Fiori SAP UI5, unlike SAP ECC which is mainly based on SAP GUI. As a reminder, SAP Fiori is a collection of applications developed to facilitate task management and user experience. It has a responsive design that allows it to offer the same experience regardless of the medium used.
Innovative technology: artificial intelligence is the future of new technologies and SAP has understood it. With S4/Hana, it becomes easier to implement Machine Learning technologies such as facial recognition, voice recognition or advanced analytics to simplify tasks and improve user productivity in all business processes.
How to Optimize Productivity in Business Management using S4/Hana?
S4Hana is an agile solution that can enable better management in companies. Let’s see the advantages of this solution and especially how it optimizes overall business management:
Increased Speed: Better Data Processing
S4Hana allows you to plan, execute, and generate reports and analyses based on real-time data; it automatically triggers closing periods and gives improved forecasts.
Ease of use
Managing and administering the IT landscape is simplified with S4Hana. Indeed, simplification is one of the key concepts in the design of the software package designed by SAP. Resources are now all centralized in one place, which simplifies the exchange of information between the various business processes.
In addition, SAP S4Hana provides a simple modern interface thanks to its tile system on Fiori compatible desktop and mobile. Numerous applications such as a chat module, personalized summaries or real-time reports can be used within the company to improve the management and organization of different departments.
The steps of the Migration to SAP S/4HANA
The Preliminary Steps
To begin with, it is important to define your needs and business objectives during the audit of your company. It is also essential to answer several questions:
In general: Do you want to reduce the costs of your ageing IT? Optimize your business processes to increase efficiency? Have more transversality in your business processes? Have homogeneity of data and a greater ergonomics of access to them? Gain in productivity?
Technical and organizational level: do you have the necessary skills for this project? Do you have a lot of custom processes and codes?
Can your company withstand long cutover and test phases of the SAP system?
Then comes the Business Case with crucial questions: What will be my savings on the TCO? How long will it take to reach my ROI?
Once all these questions have been answered exhaustively, you can move on to the last step: the formulation of the roadmap for the implementation of S/4 HANA within your organization.
Here some additional recommendations beforeyou finally validate the project and launch the Kick-off:
Make this project a business affair : it has been proven many times that this element is one of the keys to a successful migration. Indeed, changing ERP and database (in this case SAP HANA) is much more than a technical challenge, it is a complete or partial overhaul of the way of workingwithin your organization.
In order to win the hearts of future users of your tool, show them the benefits they will get in their daily lives. You can measure the speed of execution of their ten most important invoices or highlight the operational insights provided by the intelligent tools of S/4 HANA.
In any case, the collective involvement of your employees will be a catalyst for success in the change management of your project.
Analyze all the planning options for your migration: do you want to migrate all systems simultaneously to limit the testing effort and the disruption to the business? Or do you prefer to take a phased approach to limit risk but at the cost of extensive testing and rework? Finally, the cost will very often be the determining factor.
Nevertheless, the migration of several systems simultaneously is an option that should be considered because it allows for better planning and resource allocation.
Ensure data quality: 40% of failures in business transformation projects are related to data quality issues. It is therefore essential to adopt a “get clean / keep clean” approach. The first step is to ensure that the data you have is clean and that it can be kept over time.
Choosing your Migration Method
The Greenfield migration consists in starting from scratch with a brand new system, a brand new structure and therefore saying goodbye to everything that has been done before.
Literally, the expression translates as “virgin land” in French. It is more a question of relocation than of migration.
Therefore, most of the time, it is companies using an ERP from another vendor that will move toward this type of migration. But there is no absolute rule. For example, a company that already uses SAP ERP can easily opt for a Greenfield migration.
In both cases, this involves cleaning up data and processes. This can be a good thing if the processes are outdated and the data is disorganized and of poor quality. The main advantage is to be as close as possible to the standard from the start and thus be able to use all the proposed functionalities. Note that the redesign of authorizations is part of this process.
It is therefore the whole structure of the company that will be modified. Moreover, Greenfield migration is often accompanied by profound organizational changes. The result will be to workwith an ERP that is in line with business needs, corporate strategy and business model.
It is very important to think and organize strategically, especially in the design of the different roles in line with the rules of each domain.
The advantages of a Greenfield migration are:
- The fact of being able to start over on a good basis
- Complete analysis of the functionalities used
- Faster access to new technologies offered by S/4HANA
Contrary to the previous type of migration, the Brownfield approach, allows you to take advantage of the existing system to transfer to S/4HANA. It consists of capitalizing on the existing system in order to switch to S/4 HANA while importing the data, codes and business processes that you want to keep.
It will consist of performing a diagnostic of an existing SAP system in order to implement SAP S/4HANA while migrating the existing SAP workflows and systems to the latest version of SAP’s ERP.
The existing structure and processes are retained. It is also entirely possible to add other processes or functionalities.
This approach is preferred for companies with a good structure and organized data. It has the advantage of being scalable because the company can keep and transfer its processes that work and, conversely, re-evaluate and transfer those that pose a problem. In addition, since everything is based on the existing system and can be done step by step, the migration is usually less expensive, shorter and does not disrupt the whole system.
Nevertheless, this solution is less conducive to innovation because the company will stay on what it knows and what it can do.
The in-between solution : the Bluefield Approach
Halfway between Greenfield and Brownfield, the Bluefield or hybrid approach is based on the best of both approaches. It will be possible to keep the aspects of a system that the company wishes to keep and, conversely, to rebuild the selected processes and then clean up and transfer the selected data to the new ERP.
It has the advantage of being able to combine several ERPs into one. It is therefore appreciated by large companies that wish to standardize practices and processes between all their subsidiaries and for companies that it has acquired, for example. Moreover, the migration time is reduced since the old system is used and works in parallel with the migration.
What are the Steps to take into account before Starting a Migration?
The objective is to discover S/4Hana. This involves setting up a new digital strategy in which ERP is central. It is advisable at this stage to include IoT, Omnichannel technologies… The objective is to propose a trial to discover S4/HANA and its functioning with SAP Fiori
Preparation consists of the beginning of the project. After having launched the classical studies (functional feasibility, technical verifications…), it will be a question of creating work teams to pursue the project and test the prototypes…
At this stage, the work will be very different depending on the project teams. For example, the data will have to be prepared (analyzed, sorted, cleaned…) from the source system before being transferred.
This is the functional and technical implementation stage. Here again, this stage will differ greatly depending on the project’s focus. If we keep our example of data, this is the stage during which the data is configured, verified, and then loaded in a secure manner. At the end of this stage, we can consider that the migration really begins.
The deployment phase is the final preparation for the Go-Live. It is essential to ensure that everything is ready for the migration to be carried out in a secure manner. Note that the phase that follows the Go-Live iscalledHyperCare. It is about stabilizing and optimizing the system.
With the project complete, the goal is to establish secure and efficient operations on the new system. But it is important that the project does not end here because S4/HANA offers an infinite possibility of innovations to continue the digital transformation of your company.
For more information, find the S/4HANA migration guide published by SAP: read here
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