SAP S/4HANA: The Next Big Thing

By Len Landale, VP ERP/Applications, Secure-24

If you have an SAP landscape, you have to wonder about all of the noise surrounding
SAP S/4HANA. Well, the latest SAP Business Software based on the in-memory SAP HANA technology is the next big thing. SAP is optimizing its core products for the SAP HANA database, and the question is not “if” organizations with SAP landscapes will migrate to S/4HANA, but “when” and “how”.

Exactly what is S/4HANA? What are the benefits? What is the path to S/4 HANA? Should I migrate to S/4HANA?

First things first – exactly what is S/4HANA?

What is S/4HANA?

SAP  S/4HANA is the next iteration of  SAP’s ERP Suite.   It is a new generation of SAP Business Suite that has greatly simplified the data architecture, program space and significantly increased efficiency. S/4HANA begins to consolidate some of the features and functionality of other SAP products into a single system including reporting and analysis.   The move to S/4HANA also integrates changes to the GUI leveraging Fiori to display data in a more intuitive way.

S/4HANA is built on SAP’s advanced in-memory platform, SAP HANA, and is deployable in the cloud or on-premise.

The Path to S/4HANA
With the adoption of S/4HANA increasing and the business case becoming more compelling, for many organizations, the question of the path to S/4HANA must be answered.  For a company running an existing version of SAP ECC, there are essentially three paths to S/4HANA.

Option 1: The first option and one that will retain the most information from the source including System ID and customization (Brownfield).  This is an in-place upgrade and can be done for any system on ERP 6 using the Software Update Manager (SUM) with Database Migration Option (DMO) to convert to HANA and upgrade at the same time.   The conversion of an existing system, like any previous upgrade will require functional and development teams to remediate changes in programs and configure new functionality.

Option 2:  A company may choose a greenfield implementation of S/4HANA in order to convert from a legacy system or re-implement, in order to achieve business processes realignment with new features and functions.   In a Greenfield deployment, a new S/4HANA landscape is installed and configured to meet business needs.   The data loaded into the new system is a minimal subset of data from the old environment.

Option 3: Landscape Transformation is primarily for companies who want to consolidate their existing SAP landscape.  Typically, running multiple productive instances for global regions and can leverage the upgrade to consolidate to a single instance.  This technique will take on instance as the seed and perform customization for adding additional regions.

The Right Choice for You

At Secure-24, we see clients taking both the Greenfield and Brownfield conversion paths.  The latter leverages an interim step to move to Suite on HANA (SOH), which has the benefit of HANA performance improvements with no or minimal involvement from the business and functional change.  Deciding on the approach will be specific to an organization’s implementation and use case.  Two guides that can help organizations say “Yes to S/4HANA” are:

Simplification Guide – outlines the functional change and enhancements compared to earlier versions of Suite
Upgrade Guide for SAP S/4HANA – This guide explains the upgrade process for the upgrade from SAP S/4HANA, on-premise edition 1511 (all feature package stacks) to SAP S/4HANA 1610
Benefits of S/4HANA

SAP S/4HANA can drive value across all lines of business – no matter your industry or business size. Some of the business benefits include:

  • Simplicity – simplified IT due the centralization of hardware and network resources.
  • Agility – the interface is completely Fiori-driven, so users can access information anytime, anywhere.
  • Optimized Performance – increased speed of transaction processing.
  • Reduced TCO – hardware and software costs are reduced due to the consolidation into a single system.

SAP Strategy
An SAP strategy is of the utmost importance for organizations with an SAP landscape. New technologies, such as S/4HANA forces organizations to review their SAP strategy.  The strategy goes beyond technology and includes your business management model of people, process and information/data. Your strategy consisting of your technology and business objectives will determine when and how you move to S4/HANA.

SAP S/4HANA Summary
For many companies this is a new skill set and potentially a significant investment in training resources on HANA as well as, procuring infrastructure that will support the in-memory HANA database required to run S/4HANA.

In order to prepare for SAP S/4HANA, companies may seek to employ a certified SAP hosting provider to assist with a landscape assessment that objectively evaluates their upgrade readiness, as well as the best deployment path.  Many SAP hosting providers have made this investment in technology and training, with SA expertise who can assist in conversion or migration projects.