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Roadmap to a Value-Driven SAP S/4HANA® Approach based on early value realization

April 29, 2020

Every company is faced with the same questions when transforming from SAP ERP to SAP S/4HANA:

  • How do I maximize value creation?
  • How do I accelerate my ROI?
  • While replacing a highly integrated existing SAP ERP, can I avoid a big bang in order to reduce risk on business continuity?
  • Is there a way for my organization to implement S/4HANA and comply with all of the above elements?

When large, existing SAP ERP customers look into the SAP S/4HANA roadmap, it is because they want to leverage this move to rationalize both functionally and technically. That’s the reason why a global template is often the target. The next questions are:

  • Should I wait to have my global template complete to start implementing?
  • Business owners need to urgently implement digital transformation. How can I satisfy them and get benefits not in two years but now?
  • More generally speaking, is there a way to implement more rapidly, keeping a global template approach as a target while leveraging an incremental and iterative approach?
  • What are the criteria/dimensions to organize my S/4HANA roadmap to be more agile and bring value to the different entities faster?
  • How do I assess whether it is feasible in my context?
  • How much can I gain through this approach in terms of faster value realization?

Obviously, the monolithic approach for implementing SAP ERP – big bang, full scope, country by country, region by country – doesn’t answer to the above concerns. It is an IT-oriented approach that doesn’t consider the absolute need for faster change and innovation that any business faces today in its market.

In these tough times, time to value linked to SAP S/4HANA transformation is the major component of the decision to initiate such programs. A “Value-`driven SAP S/4HANA Roadmap Approach” can be a strong lever to boost ROI and obtain the joint commitment of business and IT to launch such programs. In this case, it makes the decision for a SAP S/4HANA digital transformation easier and more predictable.

What is different with the Value-Driven SAP S/4HANA Roadmap Approach?

With Capgemini’s “Value-Driven SAP S/4HANA Roadmap Approach,” the focus is on bringing value to the business as quickly as possible. Time to value becomes the primary target while also considering constraints in order to define the optimal journey for digital transformation enabled by SAP S/4HANA.

The main characteristic of this approach is that it is modular in essence. It surpasses the native integration of SAP solutions, which are often perceived as a roadblock. Therefore, this approach considers SAP solutions as modular components in line with the independent capabilities that a customer wants to deploy. For example: plant maintenance, or customer portals for order positioning can be implemented independently from the finance functions. Additionally, early “WYSIWYG” (what you see is what you get) increases the acceptance and motivation of everyone involved.

The Value-Driven SAP S/4HANA Roadmap Approach is supported by Capgemini’s MPSA (Multi-Pillar SAP S/4HANA Architecture) and Renewable Enterprise models. It leverages the agility provided by the architecture of the newest SAP and non-SAP solutions (Hybrid Cloud, SaaS, APIs, microservices).

How to determine the SAP S/4HANA Roadmap that fits to your business?

The SAP S/4HANA Roadmap definition starts with identifying where is the value:

  • Selecting main business areas
  • Quantifying and prioritizing value brought through the different levers/functions
  • Identifying “speedboats” for fast value realization.

In parallel, we design how to maximize value realization through a “Magic Cube model.” The “Magic Cube” representation comprises independent technical and functional building blocks that can be implemented incrementally and independently across the key dimensions and seamlessly integrated with existing legacy applications.

A critical step is then to define the relevant key dimensions to represent the main value transformation streams. This requires an in-depth analysis of the customer’s business. Such analysis considers the following components (non-exhaustive list):

  • Are we addressing a global or regional business (sales, supply chain models)?
  • Is market maturity different among regions, countries, BUs?
  • Are the value levers more important in certain areas, namely supply chain or sales?
  • Are there new business trends/regulations that need to be adopted within a certain timeframe?

Interactions with business owners are essential during the “where is the value” analysis in order to determine the relevant dimensions for the “Magic Cube” model (non-exhaustive list):

  • The organization: BUs, corporate functions, legal entities
  • The business functions, processes in scope: commercials, finance, logistics
  • The geographies/countries to be covered
  • The products/services delivered
  • The business complexity: maturity of market/products and corresponding business expectations.

The goal of the Magic Cube representation is to:

  1. Identify the main two to three key dimensions.
  2. Define transformation priorities based on value levers and business priorities.
  3. Define implementation requirements (which building blocks are required for each implementation) according to business and IT requirements.
  4. Define the value-optimized SAP S/4HANA Roadmap within the Magic Cube based on value levers, dependencies and other constraints (technical, organizational, decoupling of processes, etc.).
  5. Define speedboats for immediate value realization.

The speedboat concept leverages the modular architecture of new SAP solutions and the ability to rapidly bring value to business. As an example, why should we wait for the SAP S/4HANA core implementation until we offer customer portals capabilities to allow omnichannel sales and permit better visibility on order status.

Speedboats implementation is addressed in a parallel approach to the SAP S/4HANA core under the assumption that:

  • Value brought is expected in a very short time (between six to nine months)
  • Interim scenario goes along with possible rework when deploying the target architecture .

What are the key achievements for customers using a Value-Driven SAP S/4HANA Roadmap Approach

Based on a business-case approach embedded in our project approach, we achieve, without violating the SAP standard, an early and faster implementation of SAP components or processes (building blocks). Our experience is that, on large SAP S/4HANA programs, EBITDA targets are brought with an acceleration of 1.5 years (for an overall program duration of 5–6 years). The fact that temporary interfaces have to be used in some cases or that master data has to be enriched or redundantly structured is part of the business case.

The Value-Driven SAP S/4HANA Roadmap Approach is characterized by the fact that the earlier implementation of beneficial modules and processes, which are defined within the first preparatory project phase, are put live faster, enabling the business to benefit from the innovations and improved processes more quickly.

The roadmap itself follows the established iCaptivate deployment method. iCaptivate drives the highest possible value-generation based on efficiency, effectiveness, and speed by leveraging the Digital Delivery Framework (DDF), a Capgemini tool that helps to deliver the project in an agile way and automates many non-value add activities, focusing on quality and consistency.

With the “Build for purpose and deploy on value/demand” approach and the unique promise to drive differentiation and thought leadership, we help our customers to reinvent themselves and take bold steps towards the future.

Think Big, Think Different – What’s next for your business?

Contact Günter Knorr and Olivier Mignen for further insights.