Scope for compliance and innovation

Few topics move SAP's existing customers as much as the switch to S/4 Hana. Despite all the teething problems with the market launch and ongoing criticism from the SAP community, an online survey of 500 decision-makers in German-speaking countries conducted by the German-speaking SAP User Group in early summer 2017 shows that the changeover to S/4 Hana will be a major success:

Almost 64 percent of the companies surveyed are now investing in S/4 Hana in the cloud and on-premise variants. By 2020, one-third of SAP's existing customers will have switched to the new software generation from Walldorf, and another 20 percent are already planning to migrate after 2020.

This is a mega project that will take up a significant proportion of the IT budget over several years and will also have a significant impact on the general IT strategy of SAP's existing customers. After all, it is no longer a question of this or that functionality, of this or that industry solution, but of fundamental issues such as the optimal IT architecture model that will be sustainable for many years to come.

In addition, new compliance requirements, in particular the European General Data Protection Regulation (EU GDPR), demand a previously unknown level of transparency and documentation in the processing of personal data on both sides of the four walls of the company's own data center.

Storing this data in an audit-proof manner and providing the best possible protection against unauthorized access to it is no longer enough. Instead, companies must know and be able to prove at any time, virtually at the push of a button, for what purpose personal data is being processed, where, how and by whom.

They must be able to intervene in these processes at any time, for example, in order to fulfill their comprehensive obligations to provide information to the supervisory authorities, but above all to the people behind this data.

Whereas it used to be the case that data should be collected as comprehensively as possible and stored securely, today the data records to be retained must be minimized and, if necessary, selectively deleted, despite the need for archiving and backups. Legacy systems and archives offer such possibilities only in the rarest of cases. So here, too, considerable conversions and investments are in the offing. And time is pressing: As of May 25, 2018, violations of the regulation will be punished.

Squaring the circle

In a sense, the pressure to innovate and new compliance requirements present IT departments with the task of somehow squaring the circle. Surveys show it time and again: Around 80 percent of the entire IT budget is consumed by pure IT operations, while only 20 percent is available for investments in innovations.

The cost of legacy systems alone often accounts for 70 percent. By contrast, the ideal split would be 60 percent for IT operations and 40 percent for innovations, and that on a permanent basis (see figure). According to the DSAG survey, IT budgets grew by an average of almost five percent in 2017 compared to the previous year.

But even such a significant increase will not be enough to provide IT departments with the financial resources they will need to digitize their companies and their business models.

In view of these figures, the solution is obvious: the cost pool for operating legacy systems must be permanently reduced. The means of choice is consolidation and decommissioning. Gartner has also taken up the issue and observes vendors whose solutions enable companies to decommission legacy systems in its "Magic Quadrant for Structured Data Archiving and Application Retirement", last updated in June 2016.

The crucial point here is that Gartner does not want the corresponding solutions to be understood merely as costs. Rather, the analyst firm concludes: "Structured data archiving and application replacement can result in significant ROI."

Permanently reduce operating costs

The prerequisites for such a solution for decommissioning legacy systems to amortize the necessary investments in a short time and subsequently ensure permanently lower operating costs are standardization and automation. These are precisely the characteristics of the JiVS solution from Swiss Data Migration Services AG.

These properties are the result of a large number of projects for data migration and decommissioning of legacy systems. In practice, JiVS has proven to reduce operating costs by 80 to 90 percent after decommissioning the legacy systems.

The remaining 10 to 20 percent can be used to continue to use legacy data, including SAP business logic, which must be retained for compliance reasons. Archiving and further use are possible at the push of a button: Data Migration Services calls this data historization or "application retirement".

JiVS is a Java-based platform and represents a combination of standard technology, applications and methodology. At the heart of the JiVS platform is the ability to detach data and business logic from the source and target systems.

At the same time, this offers a unique opportunity to clean up the existing data records and, in particular, the master data. It is precisely this cleansing that is crucial for the successful migration to S/4 Hana.

Incidentally, this applies equally and without restriction to compliance with the requirements of the EU GDPR. This is because it enables companies to fully disclose what personal data of EU citizens they have, where they store it, for what - legitimate - purposes they process it, whether this data is correct, and whether they really only store the data they need for these purposes.

In addition, however, JiVS offers them the option of specifically deleting data records that have been transferred from decommissioned legacy systems and archived. Archive and live data can also be assigned retention periods, which ensure that invoices, for example, which also contain personal data, are irretrievably and automatically deleted once the statutory retention period has expired.

If this automatic deletion has to be suspended, for example because of an ongoing legal dispute, this is also possible at the level of the individual data records. Retention management is the keyword here, and the corresponding functionality is part of the JiVS Platform (see figure).

Rose: Successful migration to S/4

A current example of a successful migration to S/4 Hana is the project of the mail-order pharmacy and medical wholesaler "Zur Rose" based in Switzerland, which includes such well-known brands as DocMorris. With the migration to the new SAP generation, the company wanted to unify its heterogeneous IT landscape as well as separate legacy data from current data. Furthermore, operating costs were to be permanently reduced.

The customer benefit: "We are solving two major tasks at once," says Michael Herrmann, Project Manager, Zur Rose Suisse . "For us, the crucial point was to achieve the cleansed transfer of data from the legacy systems to the new SAP and, at the same time, archiving in compliance with the law." (More details in the case study starting on page 58.)

Conclusion

SAP legacy customers are caught in a dilemma between budget constraints on the one hand and innovation pressure and compliance requirements on the other. Decommissioning legacy systems and archives is the way out of this impasse.

Intelligent platforms such as JiVS reduce the number of operational SAP systems and the volume of data records stored in them. JiVS creates the necessary financial freedom for the new generation of SAP software and makes the IT landscapes of existing customers weatherproof for current and future compliance requirements.