SAP migration: Just a question of benefits?

SAP migration: Just a question of benefits?

 

It costs time, a lot of money and is actually unavoidable in the end – the migration to S/4HANA. But what is the real benefit of switching to SAP’s new ERP system? […]

The pressure to switch to S/4HANA is growing. Because the clock is ticking and the end of maintenance for the predecessor system is inexorably approaching. The motivation for migration is different. Some see only the technological necessity, to which the product strategy of their software supplier forces them. Others see an opportunity for more innovation in processes and the entire business. There are many shades in between. There is no general answer on the reason for switching to SAP S/4HANA.

First of all, the migration to S/4HANA offers the possibility to eliminate many customizations from the previous systems and to return to a standard. The extent to which this affects the classic ERP processes such as accounting, materials management or order processing depends on how much innovation is in them. As a rule, no major changes are expected for these stable processes. However, what will change is the processing of the data flowing through these systems and the resulting opportunities for a company. Due to the faster access to the constantly growing amounts of data and the possibility of connecting data analytics or AI, S /4HANA forms the basis for a completely different ecosystem.

The technological approach is one of two main directions for the migration to S/4HANA. The other is process-driven. This means that many companies want to support their digitization with the new SAP system. The main focus is on optimizing, harmonizing and standardizing processes.

There is usually no way around this, especially because the business is currently changing massively. But it is almost impossible to completely cover the transition from classic business models to real-time, customer-oriented service models with an ERP monolith. That is why the trend is increasingly emerging to supplement a modernized ERP core with additional accompanying solutions.

Workflow-driven tools will move more and more away from the core ERP in the future. Numerous tools – even outside of SAP – already promise to simplify the integration of other solutions. For example, quite a few companies rely on Salesforce for CRM. But does a classic ERP still need it at all? Yes, because the master data that is present in the old core, no one will simply throw away. However, the integration – especially of SAP and non-SAP solutions – is not a piece of cake. Licensing issues in particular can quickly become complex.

Modernization with S /4HANA is a project in which the question of added value should be compared with the effort. Although they have been very successful with their previous processes and have invested a lot of money in the templates of the old SAP system, there is a good reason why many companies still decide to migrate: more agility.

Many companies find it difficult to clean up, harmonize, consolidate the old system beforehand and take a close look at the templates and customizing the old ERP. This is the only way to determine what will be important in the future, and it is therefore worth taking with you. The move away from adapted processes to a standard in S/4HANA has the advantage that they no longer have to be constantly maintained.

But what about processes that cannot be mapped with a standard and for which the SAP shelf does not yet have an alternative? An ERP in the cloud could be an option here. The RISE-with-SAP program already comes with a bouquet of licenses in the Private Cloud Edition, with which you can try out and use many things. However, a later move to the public cloud entails new costs. However, it is important how an agile integration between the systems can be designed.

However, anyone who is still fundamentally engaged in determining the added value of S / 4HANA is certainly still far from the topic of cloud interoperability with their thoughts. Therefore, experts advise: if migration, then you should start it right and already consider when and if you want to go to the cloud during the evaluation. Because even if the shyness about it is still great – topics such as cybersecurity or updates are in better hands with the professionals. So instead of dealing with it yourself, you should rather focus on the transformation of the processes, at the end of which the business is at the center.

Study “S/4HANA 2022”: You can still participate!
COMPUTERWOCHE is currently conducting a multi-client study among IT decision-makers on the topic of S/4HANA. Do you have any questions about this study or do you want to become a partner, Regina Hermann will help you (rhermann@idgbusiness.de , Phone: 089 36086 384) would be happy to continue. Information on the study can also be downloaded here (PDF).

The key point is: a stronger process focus gives S/4HANA a meaning – not the other way around. But many companies have lost their way in their processes and are afraid to check them using process mining. In addition, they often lack the team and the methods to do so, or even the end-to-end view of the processes. But there is no way around more transparency. It is also important to think outside the box and also to include customer and production processes. To ignore these would mean to leave added value.

Just the opportunity to have to deal with its entire process landscape in detail, to question it and to analyze it for future viability is already the greatest added value that S/4HANA can offer a company. Consequently, an SAP transformation is definitely not an IT project. To make them successful, hybrid consultants are needed who know the business, the processes, the business models and the industry, but also understand IT. Because only if the company is picked up holistically, then it can also get the most out of S/4HANA for itself.

*Iris Lindner is a freelance journalist for electronics and automation.

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