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The digital twin and SAP S/4HANA®

Sanket Solanki
March 1, 2021

As SAP plans to discontinue the mainstream maintenance of its existing ERP solutions by 2027, organizations are considering various methods in their transition to SAP S/4HANA®.

This presents a golden opportunity to transform and digitize operating models, processes, data, and technology to create an organization that adapts easily and with agility, while also accelerating the value of their S/4HANA roadmap.

The “S” in S/4HANA is for “simple”

Efficient, effective, and secure migration starts with data harmonization and end-to-end business process standardization, before launching a new, digital core.

It’s best to approach this strategically:

  • Design a frictionless, agile operating model, where global end-to-end processes are standardized and designed towards a common S/4HANA-enabled template
  • Assess digital opportunities to streamline, optimize, and automate processes, with AI-enabled controls and automation zones
  • Establish and integrate best practices and KPIs
  • Review existing SAP and technology architecture, with a view to minimizing customizations and assessing other digital tools (including platforms, workflow, robotic process automation (RPA)/artificial intelligence (AI) integration, data management, knowledge management etc.)
  • Enable simplification of the core by aligning with the overall business and IT roadmap to gain adoption
  • Conduct appropriate cost benefit analysis of future opportunities and prioritize, with assigned ownership.

Enter the digital twin for S/4HANA

As the tools of innovation improve, the capabilities of digital twins are enabling more companies to enhance performance and drive stronger business outcomes.

A digital twin of an organization is a virtual replica of an actual and potential processes, products, or services that enables you to analyze and optimize those processes, products, or services in a digital instance to simulate the impact of change before they become reality.

The impact on business operations is to simulate the impact of change for any organization, using metrics, volumes, and data that can be integrated into the model.

Capgemini delivers digital twin

Capgemini recently worked alongside an organization on such a program. The aims were to:

  • Design an S/4HANA-enabled operating model to enable the client to recreate its process landscape and adjust to organizational changes over the years to come
  • Identify, evaluate, and prioritize opportunities for transformation in line with the business’s SAP S/4HANA migration roadmap.

The digital twin was set up to address the full scope of finance and accounting, supply chain, procurement, master data, and HR. The cloud-based SAP S/4HANA operating environment covered globally standardized processes, all modeled within the BusinessOptix platform. This model was enriched with AI and RPA-zones, roles and activity owners, S/4HANA Fiori-transactions, and integrated controls, to function as the North Star for our client’s organization.

As a result, ready-to-use process flows emerged that the organization could immediately introduce, significantly reducing the time and cost expended on training and onboarding.

The net outcome of all this is that the business is now able to merge the migration of its system landscape with the organizational changes it is making as part of its digital transformation.

The ultimate goal – a frictionless enterprise

In summary, developing a digital twin for SAP S/4HANA enables businesses to remove bottlenecks from current processes, simulate the impact of organizational change and establish a common design towards a digital future.

The ultimate outcome is what we at Capgemini term the Frictionless Enterprise – an organization in which data can flow seamlessly between people and processes, intelligently, and as and when it is needed.

Pre-configured solutions of this approach are available that can save weeks in days sales outstanding (DSO) and reduce total operational costs by 40 to 60 percent. The sooner businesses embark on the path to digital transformation, the better able they’ll be to take advantage of game-changing approaches like this.

To learn more about how Capgemini’s integrated D-GEM for SAP S/4HANA solution enables our clients to determine and operationalize their unique S/4HANA journey, contact:

Learn more about how Capgemini’s Frictionless Enterprise approach implements ways to detect, prevent, and overcome frictions in our clients’ business operations, delivering enhanced business outcomes in a value-focused way.

Sanket Solanki advises clients on implementing finance transformation opportunities across their operations that address their future strategic vision, whilst designing and developing agile business and operating models, augmented with AI, to drive sustainable business outcomes.