Capping IT Off

Capping IT Off

Opinions expressed on this blog reflect the writer’s views and not the position of the Capgemini Group

Are you saying no to SAP S/4 HANA?

Are you an existing SAP customer who is saying no to SAP S/4 HANA? I am sure you have your own valid reasons for saying so. Let me assure you that you are not the only one who is questioning the move to this platform. I have come across many customers who are struggling to decide whether or not to welcome SAP S/4 HANA into the fold.

All existing SAP customers know that current version of ERP software by SAP has an end-of-life at 2025. It is evident that customers who want to stick to SAP as their ERP solution provider may delay the adoption but will be unable avoid it.

Let’s start by understanding existing customers’ perspectives and reasons for not jumping onto SAP S/4 HANA bandwagon. I have come across following concerns from customers in various discussions:

1. I completed a large business transformation program with SAP ERP two to three years ago and our company has just started seeing the benefits of the program. The company invested millions of dollars and years of time. Should we embark on another transformation journey?

2. I just finished SAP Business Suite migration to SAP HANA database. But, our users are still getting accustomed to the systems post-migration. Should we start another SAP S/4 HANA conversion project?

3. I am not sure which adoption strategy will work for me. I do not want to start fresh and throw away my investment thus far in an existing SAP ERP system. How do I decide what is best for me?

4. I executed an SAP S/4 HANA readiness assessment for my existing system and found that a negative conversion result. What should I do?

5. I am keen on adopting SAP S/4 HANA by system conversion, but I hear that conversion is not a technical project. Lots of business processes will need to be re-implemented, which may take longer than usual platform change projects.

6. I am not able to justify the value of SAP S/4 HANA adoption. How do I go about it?

You may have heard some of these trepidations from your customers. In general, customer concerns center on investments, business value, benefits, adoption strategies, and the possibility for conversion. All of these concerns are justified, and there is no singular way to address them that applies easily to all customers. For an existing SAP customer, it is important to understand the positioning of SAP S/4 HANA and value it brings to the table to help the enterprise achieve their digital roadmap. I tend to advise customers in the following ways:

1. Start small: go one step at a time

There is no need to jump on the bandwagon due to hype. It is a new product from SAP and all the marketing around it is very much justified. Every customer needs to evaluate SAP S/4 HANA in his or her own context and then decide about adoption.

2. See the larger context of SAP S/4 HANA

As we all know, SAP S/4 HANA is not a successor of existing SAP ERP software and is a different product line altogether that aims to simplify business processes, data models, and the overall system landscape of the customer. It is positioned as the digital core of an enterprise business to start the customer on the digital roadmap. SAP S/4 HANA should not be looked at as technical upgrade or business software providing incremental advantages over existing SAP ERP.

3. Define your digital roadmap

Customers should define their company’s digital roadmap by considering the competitive environment and future direction in their industry sector. This should be a product-agnostic exercise, influenced by goals set by the enterprise to be achieved in near, medium, and long term.

4. Find business value of SAP S/4 HANA

Once the roadmap is defined for the enterprise, it is time to get to know what SAP S/4 HANA can do for you. Finding the business value of SAP S/4 HANA requires completing a detailed assessment, which gives you the power to take the adoption project for approval. This is also the time to explore SAP S/4 HANA and a feel for the enhanced features, new solutions, and capabilities. You can get started with a trial SAP S/4 HANA system in few hours if you choose to use SAP Cloud Appliance Library on the cloud.

5. Finalize your adoption strategy and start the transformation

Only once you have defined the digital roadmap for your organization and found a good number of business value in SAP S/4 HANA should you come to this step. SAP S/4 HANA adoption strategy will vary from customer to customer. Many customers feel that SAP S/4 HANA is an evolving product and they do not want to disturb their existing system landscape. Some customers found that their existing system was not supported for SAP S/4 HANA conversion, and they had no other choice than to start with a green-field approach. Depending on the complexity of the ERP landscape, consolidation can also be one of the areas where you start by having a master green-field instance or convert an existing system. With many standalone solutions as part of the core, and the easy availability of pre-activated best practices, a transformation with SAP S/4 HANA is not expected to be as long as the usual SAP ERP implementation.

No matter what your adoption strategy is, this is the time to find how you can leverage your existing investments. You can perform a custom code analysis in order to identify the impact and see how you can reuse your investments if you are going for a green-field approach.

Conclusion

SAP S/4 HANA is a journey that needs lots of attention and preparation. 2025’s end-of-life deadline is not a good enough driver in 2017 for SAP S/4 HANA adoption, and existing SAP customers should invest enough time and effort to comprehend its business value and how it adds to their digitalization goals. Next time, if a sales executive approaches you for SAP S/4 HANA project, you shouldn’t say “no” just like that. Ask for specific support in the various steps upon which you are about to embark to find value and define the best adoption strategy.

About the author

Prabhakar Lal

Leave a comment

Your email address will not be published. Required fields are marked *.