Roadmap to S/4HANA: Practical tips for a successful migration

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By MR BLUEFIELD - July 09, 2020

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pixabay | arek socha

For most companies, switching to the new SAP business solution S/4HANA is not a detached IT project, but an extensive transformation process. Those who want to master the challenge therefore need precise knowledge of the technological status and strategic goals of their company, as well as detailed project planning in the form of a roadmap. We give you practical tips for a successful migration.

 

What options exist when it comes to the migration to SAP S/4HANA – and which approach best suits ones own company? When do project steps have to be taken – and in what order? And how can the internal team optimally prepare? Decision-makers are faced with many questions when switching to the new software suite, which will replace existing ERP systems by the end of 2027.  According to a trend survey conducted by the IT online magazine, 60 percent regard finding a suitable migration strategy as the greatest difficulty connected to the transformation project.

Setting a precise timetable for the changeover is challenging, because it involves a combination of technical, strategic and organizational aspects. The transformation project usually forms the basis for further digitization, globalization and standardization of business processes and thus has a strong impact on the sustainability of companies.

Although the design of a migration strategy and roadmap is always dependent on the respective initial situation and status quo, the strategic reorientation of a company and the resulting demands on the new IT environment, the transformation project is also a key factor for the future success of an organization. Nevertheless, there are some general recommendations for action that help to steer the S/4HANA project on the road to success:

 

Planning and analysis: Defining the current status and goals

As the new digital core of the IT architecture, S/4HANA is intended to support SAP user companies in addressing the challenges and opportunities of the digital age in a fast, flexible and informed manner, as well as in mapping business processes in a lean and secure manner. But what exactly does this mean for your own organization? In order to be able to optimally exploit the potential of the new Business Suite, decision-makers need precise knowledge of the current status and the strategic goals of their company. They should know where the company currently stands, how future-proof the current business model is and how the company intends to position itself in the future - ideally this has already been defined in the corporate strategy. This information determines the extent to which IT and business processes need to be adapted and what business, organizational and functional requirements the new S/4HANA environment must meet. The findings should thus be incorporated into the new SAP strategy or the transformation roadmap.

 

IT architecture and processes: Determining the technological status quo

Companies that have been operating their IT systems for a long time know the problem: In many places, in-house developments or additional modules are used, individual processes deviate from standard processes. Often, analysis and evaluation models are also developed and updated remotely, making it difficult for the IT department to maintain an overview of the heterogeneous system landscape. The conversion to S/4HANA then proves to be particularly challenging. In order to set up the project in the best possible way, the entire IT and SAP infrastructure must be examined. In addition to decision-makers and IT, other departments should also discuss what the future SAP landscape must be able to provide in terms of technology and functionality. Specialist colleagues usually have the best knowledge of data and can help to optimize the changeover process.

 

Professionalizing the project, integrating external expertise

A complex transformation project such as an S/4HANA implementation does not have to be managed by companies alone - and from an economic point of view it should not be. Experienced service providers can carry out projects quickly and reliably, thereby significantly reducing overall costs. Together with management and employees, they use workshops and interviews to take stock of existing IT processes and tools. With the help of innovative software solutions, SAP landscapes with their system structures, data volumes and configurations are analyzed and visually displayed, and the effects of planned changes are simulated prior to the actual transformation. Based on the results, a well-founded transformation strategy and roadmap are created - and possible sources of error and risks are eliminated from the outset.

The fact that several project steps such as chart-of-accounts harmonization, conversion to the New General Ledger (New GL) and Unicode or system upgrades can be combined also has a positive effect on project duration and costs.

 

S/4HANA: Migration approach and operating model should be chosen with care

The basic decisions for the design of a tailor-made roadmap also include the choice of the implementation scenario and the operating model. Should the systems be operated in the cloud, on-premise (i.e. on separate servers) or in a hybrid model? Which migration approach for data transfer is the right one? In order to be able to decide this, project managers should be informed in detail about the advantages and disadvantages of the various options. It is important to know, for example, that the choice of migration approach can have a significant impact on the duration and success of a transformation project.

 

Bluefield: Knowing alternatives to Greenfield and Brownfield

Up to now, companies have mainly relied on the classic migration methods Greenfield (new implementation) or Brownfield (upgrade of existing systems). Hybrid approaches often prove to be more target-oriented, because they enable a particularly flexible, fast and secure change. One example of this is the BLUEFIELDTM approach: With the alternative method, companies can take advantage of the combined benefits of Greenfield and Brownfield. Master data and transaction data can be specifically selected and used in the new system; historical data is archived. The consulting effort, project duration and costs are reduced considerably, because the data migration is automated in usually only one go-live and thus system downtimes are reduced to a minimum.

 

Addressing preparatory measures early on

In order to successfully carry out the actual S/4HANA conversion, some sub-projects should be completed in advance. In particular, outdated ERP systems must be thoroughly cleaned up and in-house developments must be harmonized or shut down. Examples of this are the preparation of SAP master data, the adaptation of the SAP authorization system, or the redesign of the SAP security concept. Parallel to the progress of the project, all employees should receive further training in using S/4HANA. From SAP experts to end users, tailored training measures are required for each employee group to ensure that the full potential of the new ERP suite can be exploited.

 

Conclusion: Planning S/4HANA migration without time pressure

The commitment to a migration strategy and transformation roadmap is essential for an S/4HANA implementation. However, in many companies, this requires an intensive learning process: strategic goals, the technological status and the diverse requirements of the new SAP S/4HANA landscape must be determined, analyzed and brought together. Decision-makers are well advised to plan the project, and in particular the identification phase of the migration strategy, without time pressure - and to continue to drive the transformation project forward even during the crisis. After all, the sooner the migration to S/4HANA is initiated, the sooner the benefits of an agile digital company can be enjoyed.

When planning, it should also be considered that experienced service providers are much frequented, as more and more companies are deciding to migrate and are looking for competent partners for this task. If you start the project early, you will have access to professional support that will make the migration uncomplicated, secure, fast and completely remote during the time of the pandemic and beyond.

In any case, SAP user companies cannot avoid switching to S/4HANA: standard maintenance for the existing ERP systems will expire at the end of 2027, after which the risk of weak points and sources of error will increase. In addition, existing systems might already no longer meet the constantly changing requirements. By migrating to S/4HANA soon, companies will create a strategic platform for their digital future and expand their own competitive advantage.

 

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MR BLUEFIELD SUMMARIZES

  • Many decision-makers view the creation of a migration strategy and roadmap as the biggest challenge when it comes to the implementation of SAP S/4HANA .
  • For developing their strategy, they need precise knowledge of the technological status and the strategic goals of the company.
  • The complex requirements for the new SAP environment should be clarified with IT and other departments, since these colleagues usually have the best knowledge of data.
  • It is also crucial for the success of the project that some tasks are completed prior to the transformation. Outdated ERP systems must be thoroughly cleaned up and in-house developments need to be harmonized or shut down.
  • Experienced service providers can help to carry out projects quickly, securely and remotely, to drastically reduce overall costs and also clarify the advantages and disadvantages of different migration strategies and operating models.