Tips for Successful S/4 Hana Implementations

More flexibility and agility are the order of the day, according to a study conducted by Arvato and PAC. The following article gives a short summary of its findings as well as what steps to take for a successful S/4 Hana implementation.

The majority of respondents thinks positively of SAP’s new system. Roughly two thirds expect a significant increase in speed concerning processing and data analytics; more than half expect the S/4 implementation to be the starting point of the modernization of their other SAP systems and infrastructures.

48 percent trust that S/4 will be more user-friendly, flexible, and adaptable than past versions. While five percent of companies already completed the implementation of S/4, nine percent were currently in the process of implementing it.

Furthermore, 18 percent are planning the migration to S/4 and Hana, meaning that two thirds of respondents already use Hana or are about to do so. 54 percent have not decided yet.

Greenfield or brownfield?

If companies have decided on Hana, they have to deal with a new set of challenges, for example to develop a suitable strategy including time frame and budget. S/4 implementations have to be meticulously planned. It entails a conversion of comprehensive, mission-critical business process systems, after all. S/4 Hana migrations are complex, affect many users, and often have a strict time frame and budget to adhere to. Furthermore, they often happen during regular operation, but cannot impact daily processes whatsoever.

For 68 percent of respondents, the most important thing is that S/4 will support and improve existing SAP processes. PAC prefers the Greenfield approach for that because S/4 is closely tied to the lines of business. They argue that business processes can only benefit from S/4 and consequently from higher data analytics performance and user-friendliness by choosing a Greenfield approach.

The installation of new SAP systems allows for the complete restructuring and redesign of processes to make them more adaptable. However, only 33 percent of respondents said that they will choose this approach.

Two thirds of respondents chose a Brownfield approach, meaning that the migration to S/4 is treated like a regular upgrade. Of those respondents, 73 percent preferred a system conversion, an entirely technological migration. The remaining 27 percent chose a migration process during which they would consolidate and harmonize their SAP processes. Companies should evaluate if they can reach what they hope to accomplish with S/4 and Hana through a mere system conversion.

Check on the simulator

It’s recommendable to make comprehensive tests in a simulator before migrating. The test users should be representative of all future user groups like controlling, logistics, or manufacturing. Tests should consist of typical processes, workflows, and application scenarios.

39 percent of respondents think it best to hire external IT consultants for the migration. 27 percent focus on consultancy concerning optimization of business processes; 15 percent consult external experts on the implementation of new business process and models.

Making the hardware fit

For more than 80 percent, the most important criteria for external consultants is their competency regarding transformation of business processes. They should not only be well-versed in SAP, but also in other IT systems.

They have to know how the company functions and what special requirements it has; furthermore, they also have to have know-how of the industry. 70 percent of respondents agree on these points and demand industry know-how from external consultants.

We recommend carefully evaluating a potential partner as well as their S/4 Hana references; something that three fourths of respondents would also recommend. Every project needs someone to lead it, and their decision is binding for everyone. The ideal project director is competent, assertive, and trustworthy. Furthermore, it’s always an advantage to have kind of a personal authority as well as social and emotional intelligence.

Whoever wants to operate the new ERP suite in their own datacenter needs suitable server hardware for S/4 and Hana. Moreover, companies should evaluate if their customized developments are compatible with Hana. By the way, this is the perfect opportunity to clean up your IT landscape.

Companies can also choose between the on-prem solution or its cloud alternative. IT service providers like Arvato can usually support both scenarios.

SAP S/4 Hana in Germany

Around one hundred executives and SAP managers from German companies with at least 1,000 employees were interviewed by telephone.

More than a quarter of respondents already use the SAP Hana platform, for example as a database for the data warehouse (SAP BW). The survey took place in May and June 2018. Fifty-seven percent of the companies belong to the service, trade and transport sectors, while the other 43 percent are in the manufacturing/production sector.