New controlling paradigm?

SAP S/4 Hana with the Finance module has the potential to initiate a paradigm shift in controlling. The technological innovations it contains can lead to a fundamental improvement in the basis for business decisions.

From a technological perspective, the biggest innovation in S/4 Hana Finance is the unification of finance and controlling. The SAP modules FI and CO are thus merged into one solution.

The use of the Universal Journal now makes it possible to summarize all information relevant to finance and controlling on one document. This approach consolidates the previous two-circuit system into a single-circuit system, which brings decisive advantages.

The system-inherent, uniform data basis for finance and controlling thus created, as well as the availability of information in real time, represent elementary improvements. Data uploads from SAP FI to SAP CO are a thing of the past, as is the previous data reconciliation between the modules that became necessary after each upload.

In addition, S/4 Hana Finance offers options for integrating other data sources and processing data contained therein. S/4 Hana Finance with its new technological achievements enables controlling to spend more time on the qualitative analysis of results, among other things by accelerating quantitative evaluations.

With the help of this solution, a controller can gain time to concentrate more on the important and strategic tasks of controlling: the derivation of measures and recommendations for action.

High-quality forecasts that also allow different future-oriented scenarios to be shown can be produced much more easily today.

Decisions can thus be made on the basis of a greater quantity and variety of information. However, the mass of information available requires an even stronger focus on identifying the information that is really relevant to management and setting up a corresponding reporting system.

The goal must be to select and analyze the right information that is relevant for decision-making without further inflating the reporting system.

For the presentation of reports, S/4 Hana Finance again provides very good and innovative options (SAP Digital Boardroom). However, there is still room for improvement in the commenting of analysis results in order to make them more comprehensible to management and thus enable decisions to be made more quickly.

The new quality of the analysis results has the potential to significantly improve far-reaching entrepreneurial decisions and to shorten the reaction time of companies to changing framework conditions. Agility and speed are increased, which is a decisive success factor in the economic and social environment.

From a purely technical point of view, the introduction of S/4 Finance also makes it possible to perform profitability analyses in real time and to create ad hoc profit and loss statements.

Knowing where the company stands financially at all times is a frequently expressed wish of top managers, which can potentially be fulfilled with S/4 Finance.

This enables them to react to changing market conditions in an agile manner and in real time. With S/4 Hana, controllers therefore have the best prerequisites for evolving from their classic role into a driver and decision maker.

However, technological progress and changed framework conditions together are not sufficient to fully exploit the possible potential for repositioning controlling.

A technology change consists only to a rather small extent of a purely technological adaptation. The greater challenge lies in the right interplay of processual, organizational and cultural transformations.

Involving employees not only in controlling and informing all stakeholders about the changing situation are essential for a successful change.

Finance and controlling will move much closer together through the introduction of S/4 Finance and will merge more and more in the future. As a result, the distribution of roles and the processes of the finance and controlling areas will change drastically.

This is a development that many companies, especially in the Americas, are already living. Thus, the most important aspect for a successful implementation of S/4 Hana Finance and the exploitation of all potentials of this solution remains the human factor: the willingness to want to understand changes, to make them, to accept them and to use them constructively.

The change in the operational and strategic orientation of the areas of finance and controlling forced by S/4 Hana Finance requires that the processes to be changed as well as the organizational and cultural changes be adopted in the "DNA" of all employees and managers involved. This is the only way to achieve a paradigm shift.