Walking the Walk, and Not Just Talking the Talk with SAP S/4HANA

In the last few days Gartner has named Capgemini a “Leader” in Gartner’s 2020 Magic Quadrant for SAP S/4HANA Application Services, Worldwide.  This report has become the de facto key indicator for SAP service providers positioning by Gartner after they discontinued their more general SAP Magic Quadrants.  This is a very fast-moving market and this report covers the time period from October 2018 till September 2019.  We are really pleased with our recognition in this report, as we felt like Gartner recognized the significant investment and transformation of our SAP practice globally, as well as the differentiated approach to helping our clients in this space.  In this blog I wanted to share some thoughts around the key things that are working for us in the SAP S/4HANA market at Capgemini.

You have to recognize this is not an “Upgrade”

I’ve come across a lot of clients that refer to SAP S/4HANA as the end state of where their SAP journey will end up.  The reality is that SAP has created a very powerful and open architecture that SAP S/4HANA is only one component of (the ERP).  SAP refers to this ecosystem and the SAP Cloud Platform “glue” that holds it all together as the Intelligent Enterprise. If you are only focused on moving your legacy SAP ECC instances to SAP S/4HANA, our point of view is you are missing out on a lot of the value, and the digital transformation that can come from a move to SAP S/4HANA.  This is why you sometimes hear chatter in the market about “there is no business case for SAP S/4HANA.”  That’s because these companies are leaving a lot of value on the table by not focusing on all of SAP.

So at Capgemini we have banned the word “upgrade” from our vocabulary when talking about SAP S/4HANA.  When done properly a move to SAP S/4HANA is transformational in the best sense of the word, and it doesn’t have to be a giant multi-year disruptive program.  You can create a simplified digital core, while taking your complexity and “special sauce” that makes your company unique to the SAP Cloud Platform.   I recorded a short video about this here.

You need a vision for where you want to take your clients

At the beginning of 2019 we coined the term “Renewable Enterprise” to capture the idea that you can have enterprise technology that delivers the best of for both the business and IT worlds.  These two worlds have been in a death grip the past 20 years or so with one asking for more and more change to address a dynamic world, and the other dying under reduced investment trying to keep mission critical applications running…. and all of this had to be done in one piece of software for the most part.  This wasn’t anyone’s fault, it was the way things were –SAP ECC and its predecessor R/3 versions was the development environment.  Over time these systems became naturally ever more complex.

Now however SAP’s S/4HANA and Intelligent Enterprise allows for massively more flexibility, and a way to have a simplified and standard digital core that makes the folks in the IT department happy because it is stable, reliable, scalable and easy to support, while at the same time making the business happy because you can make changes quickly without running the risk of disrupting their entire mission critical systems.   We call this idea the Renewable Enterprise because when you architect your enterprise IT properly your systems should be able to naturally evolve, not unlike an organic lifeform, and renew themselves to address the new reality they are in.

But guess what – if you are approaching your SAP S/4HANA project like an upgrade, you are going to put all of that customization and complexity right back into your brand-new SAP S/4HANA instance.  You are not going to get the flexibility you are looking for.  We tried to graphically depict what we are talking about with this video here, and we think Gartner liked this messaging as it showed up in their report.

You can’t just talk the talk, you have to walk the walk

There are a lot of smart people out there in the SAP ecosystem talking about SAP S/4HANA.  As we pivoted our practice over the past couple of years we found that a lot of this really good thinking was not necessarily being embraced at the field and engagement level.  We really had to do some change management on ourselves as working with SAP S/4HANA is very different than the ECC and R/3 days.

We started by making a massive investment in our team globally and by driving a huge certification campaign.  As a result, we now have the most certified SAP S/4HANA consultants in the world, and have the most total SAP certifications (SAP S/4HANA and everything else) of any systems integrator in the world ( and not just a little more a LOT more).  You can check out the monthly stats that SAP keeps on this here..

But you can’t just stop at certification, you have to change the way you work, and so we have been on an Agile and DevOps journey.  I know a lot of folks think they have been doing “Agile” in an SAP context but really this is a hybrid way of working with a mix of waterfall and agile blended together.  I would consider SAP’s Activate method a hybrid methodology.

We’ve been pushing the envelope and now have what I believe is the leading implementation methodology on the market called iCaptivate (industrialized Capgemini Activate).  We talked about this a lot with Gartner as well, and think it resonated.  This is a pure Agile method, where we are no longer talking about BPP’s, functional specs and technical specs.  User stories and backlogs are what drives the work, and it has been a huge mindset shift for us and our clients that are willing to embrace it (not all are, and not all are ready to do it).  If you do this right your SAP S/4HANA project can be the pathway to moving to a DevOps way of working … but that’s for another blog.

Your solutions and IP don’t have to start with SAP S/4HANA. 

Capgemini has a long history of building very industry specific pre-configured solutions on SAP’s ERP’s over the years.  These are known as our “Path” solutions and it has been a successful model for us, and we have moved all of them onto SAP S/4HANA.

However, these days the IP and solutions we build don’t stop at the boundaries of SAP S/4HANA, and they go far beyond that into the Intelligent Enterprise and the SAP Cloud Platform (SCP).  I’m often shocked that clients have sometimes bought licenses for SAP S/4HANA but haven’t considered buying the SAP Cloud Platform licenses to go with it.  It’s very short sighted and prevents a lot of the digital transformation potential from easily being adopted as you move towards SAP S/4HANA. What used to be a user exit, custom screen or table in ECC, can now be a cloud native “app” built on SCP that is flexible and easy to support, and it is not bogging down your digital core with excess complexity.

Nowadays we are building apps on SCP as part of our solutions for our customers.  We have projects where our clients have started with SCP first, in order to show quick value to the business stakeholders, remove complexity from the core,  and will take on SAP S/4HANA down the road.  We have rapidly assembled several hundred pre-built use-cases on SCP that our customers can choose from.  These range from digital supply chain visualization, perishable food traceability, blockchain, mobile field service and maintenance, to automotive labelling and EDI.

Finally, you have to have a clear plan and business case on how you want to get to SAP S/4HANA

As I mentioned earlier we meet lots of customers struggling with the business case for S/4HANA, because they are focusing just on a technical migration of their ERP, and not the broader Intelligent Enterprise.   It was such a common problem that we developed an entire offer around helping our clients figure out how to get to SAP S/4HANA with an effective business case that will stand up to scrutiny.  This offer provides a structure approach for defining the strategy and roadmap, the level of transformation our clients want to achieve, business process optimization, and finally the actual planning for how to get it done.

The point of all this is there are lots more ways to solve business issues today with SAP technology than ever before, but you need to have the right partner to help you navigate what can be a daunting challenge.  We’re pleased and feel that in this latest Gartner’s 2020 Magic Quadrant for SAP S/4HANA Application Services, Worldwide report, they saw that we are ready to help our clients with the SAP S/4HANA transformational challenge, and bring them the innovation, methods, tools, and people required to be successful.

Gartner, Magic Quadrant for SAP S/4HANA Application Services, Worldwide

Fabio Di Capua | Susan Tan | Allan Wilkins | Jaideep Thyagarajan, April 30, 2020

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Brad Little

Expert in Business Transformation, IT Strategy, Professional Services

Experienced Executive with a demonstrated history of working in the information technology and service industry with a focus on enterprise technology. Skilled in IT Strategy, Professional Services, and Business Transformation. A track record of building organizations and solutions that deliver results.