As IT supplier, consultant, manager or end-users it is practically impossible to have missed the communication about SAP’s next generation business suite – S/4HANA (Current Release 1610). According to experts in the market the company’s biggest innovation since SAP R/3.
SAP S/4HANA is designed to help you run simple in a digital and networked world. This new suite is built on the advanced in-memory platform SAP HANA, and offers a personalized user experience with SAP Fiori. The new SAP solution simplifies the SAP landscapes and offers compelling features for SAP users who for years worked with conventional transactions. The move from transactions merely built for recording actions to a more proactive and personalized decision support with real-time data and dashboards. SAP’s Fiori UX strategy is aiming to transform the transactional way of working to a more role oriented system, already proven to be successful in other more intuitive systems such as Microsoft Dynamics Navision and Sales Force.
S/4HANA – ACCEPTANCE IN THE MARKET
The outcome of a detailed study by PAC: “S/4 HANA - Relevance for SAP customers, expectations, and obstacles” can be summarized by the following core statements:
The biggest challenges of SAP use are improving usability (74%), increasing the implementation speed of new business requirements (72%) and enhancing efficiency in backend processes (66%).
The majority of surveyed executives responsible for SAP (62%) believes that every SAP customer will have to eventually implement S/4 HANA.
There are three main reasons against using or introducing S/4 HANA. About 75% of SAP Managers identify the difficulty in estimating the burden involved in the IT changeover, the lack of business cases and the extra costs for software licenses as obstacles.
Undeniably S4/HANA will provide new possibilities in several areas such as the Internet of Things, Industry 4.0 and Big Data. The simplified data model allows customers to reimagine their IT, helping to drive lower costs and deliver IT efficiency. Is not every IT organization looking for at least 2 out of these 3 drivers? Considering this, it is interesting to take a closer look at the limited acceptance and deployment of S/4HANA in the market.
There are concerns regarding the level of maturity of the S/4HANA solution. Especially in a manufacturing/logistical environment customers are not (entirely) convinced about the added value in comparison with their current (often highly customized) SAP applications. This is however likely to change in the coming months/years. The 1610 Release of S/4HANA already contains crucial features (e.g. embedded SAP EWM, integrated Quality Management, and advanced ATP). In planned future releases other crucial features (e.g. supplier portal, embedded Transportation Management) will be added to even further improve usability and supply chain processes.
S/4HANA – VICTIM OF COMPLEXITY IN ERP LANDSCAPES
By far the biggest challenge SAP customers face when considering the implementation of S/4HANA is estimating and planning the burden involved in the IT changeover. Many organizations invest a substantial amount of their IT budget in maintaining their complex Systems of Records. While at the same time leaving little or no room to invest in new systems that will enable and differentiation and innovation (summarized in below overview). The adoption of S/4HANA amongst SAP customers is highly influenced by the complexity of the existing R3 system and corresponding lock in. SAP is to some degree the victim of its ‘own success’ and experiencing the disadvantages of the highly-customized systems running by many of their customers.
The Road to S/4 HANA – Simplify Today… Enable the Future!
Taking into account the general consensus companies using SAP applications will eventually (have to) use S/4 HANA, it is interesting to consider the Road to S/4HANA for SAP Customers. McCoy’s vision on business transformation and the Road to S4HANA can be summarized with the following statement: ‘Incremental simplification to prepare for the the disruptive innovation / simplification (S4/HANA)’ or to put it even simpler ‘Simplify Today… Enable the Future!’.
The time and speed in which each of the phases is executed obviously depends on the situation of our customers. Even for companies where at this moment implementing S4HANA seems to be a bridge too far, it is important to start considering and preparing for simplifications today!
Every decision in the system landscape should be mapped against the question whether it is ‘S4/HANA proof’! Do we use the right technology to establish sustainable differentiation and drive innovative new processes, and at the same time can we create a simple and cost efficient landscape? Does it enable the move to S4/HANA and its technologies or does it make the process even more difficult? This may seem obvious but don’t we all see many organizations spending a lot of time and efforts in changes and projects which are not necessarily ‘S4/HANA proof’. Essentially adding to the already complex system (landscape) and not providing the estimated business effects (business cases). Considering that Improvement Programs and Software Implementations often (unnecessary) delay due to complexity in data and system landscapes, it is almost unbelievable how little effort and budget is spent to improve this!
McCoy & Partners supports SAP customers in several industries to work on simplifications and simultaneously preparing for SAP S/4HANA and exploring new possibilities in areas such as IoT, Industry 4.0 and Big Data. Our approach in the road to S4HANA is best summarized as ‘Simplify Today… Enable the Future!’
Simplify Today: prepare for uninterrupted processes, data integrity and quality standards, optimized cost model and improved business insights and reporting.
Fix the Data (Simply Data) – Master and Transactional data scans to support process integration.
Fix the Applications (Simply Run) – SAP System Scan and Application Review to simplify and lower TCO by bringing highly modified applications back to standard
Prepare for System Integration - Business Process Consulting and Modeling.
Enable the Future:
Agility for Innovation
Agility for Migration
Agility for System integration and S4/HANA implementation.
Interested to learn more about the possibilities to start preparing for the Road to S/4HANA and at the same time improve your business today? Please get in touch with us!!