You’ve like­ly heard that you need to move to SAP S/4HANA by 2025, but do you real­ly know what it is or why it mat­ters to your busi­ness? There are con­stant advances in tech­nol­o­gy that come in all shapes and sizes, leav­ing orga­ni­za­tions to fig­ure out what’s impor­tant for them to do now and what can wait for anoth­er day.

ASUG News sat down to ask the authors of ​“SAP S/4HANA: An Intro­duc­tion,” a book from SAP Press, to share their insights about what makes the lat­est ERP sys­tem dif­fer­ent and what val­ue it brings to SAP cus­tomers. Andrew Wors­ley-Tonks, SAP chief archi­tect and glob­al SAP S/4HANA trans­for­ma­tion lead for IBM Ser­vices and Asid­hara Lahiri, CTO for SAP Appli­ca­tion Devel­op­ment and Main­te­nance Inno­va­tion, in IBM Glob­al Ser­vices, walked us through how to define the busi­ness val­ue for SAP S/4HANA, build a busi­ness case, and under­stand the how the entire SAP S/4HANA land­scape fits together.

Sharon: What is the most sig­nif­i­cant change cus­tomers can expect when mov­ing from SAP ECC or an old­er sys­tem to SAP S/4HANA?

Asid­hara: The most notice­able change cus­tomers will expe­ri­ence are the ben­e­fits that come with run­ning on SAP HANA, which is an in-mem­o­ry data­base. In addi­tion to a sin­gle source of truth and increased speed, you will have access to real-time data pro­cess­ing, which leads to informed decision-making.

Sharon: What busi­ness val­ue does SAP S/4HANA bring?

Andrew: Let’s talk about the val­ue dri­vers start­ing with the tech­ni­cal ones. There are three that I want to dis­cuss. The first being the in-mem­o­ry plat­form — SAP HANA data­base — which allows speed. The sec­ond dri­ver is the sim­pli­fi­ca­tion at the core, which elim­i­nates func­tion­al, tech­ni­cal, and data redun­dan­cies. The third dri­ver is around user expe­ri­ence and design. With the intro­duc­tion of SAP Fiori, you get sim­pli­fied and improved role-based processes.

When we look it from the busi­ness side, we think about the cus­tomer-cen­tric expe­ri­ence it can help you cre­ate. SAP Fiori apps pro­vide a sin­gle entry point for all users to work from any device and they are sim­ple and seam­less to use.

You also gain busi­ness val­ue from cus­tomer insights that help you make bet­ter deci­sions. Through dig­i­tal trans­for­ma­tion, it’s not only impor­tant to improve the user expe­ri­ence, but also to bet­ter under­stand cus­tomer behav­ior so you can offer a tai­lored ser­vice or prod­uct. Col­lect­ing data, mak­ing it avail­able in real time, and cre­at­ing action­able results based on the analy­sis and pre­dic­tion of that data is key.

The in-mem­o­ry data­base, along with the sim­pli­fied data mod­el allows for a sin­gle plat­form across the dif­fer­ent line of busi­ness solu­tions with one copy of data and less inte­gra­tion effort. These insights are avail­able in real time to help dri­ve bet­ter decisions.

Sharon: What key points would you high­light in a busi­ness case to switch to SAP S/4HANA?

Andrew: There is no sin­gle answer to this ques­tion, as each orga­ni­za­tion will need to define its own busi­ness case. One thing that will be true across the board is that SAP S/4HANA pow­ers an organization’s dig­i­tal trans­for­ma­tion and its abil­i­ty to cre­ate future-proof busi­ness models.

When you build your busi­ness case and jus­ti­fy its com­po­nents, you need to make sure that you know your audi­ence. Frame the oppor­tu­ni­ty in terms of the scope and busi­ness objec­tive, con­sid­er­ing what the peo­ple who will be review­ing and approv­ing it will want to know.

More impor­tant­ly, rather than just focus­ing on some of the SAP S/4HANA val­ue dri­vers I just dis­cussed, make sure your busi­ness case is aligned to your com­pa­ny’s strate­gic vision. Your busi­ness case should con­nect direct­ly with your ERP and IT road map.

Sharon: Can you briefly describe each of the dif­fer­ent deploy­ment options for SAP S/4HANA? What should a cus­tomer con­sid­er when decid­ing which option is best for them?

Andrew: There are three deploy­ment options: On-premise, cloud (pub­lic or pri­vate), or hybrid.

Let’s start with on-premise, which gives orga­ni­za­tions full con­trol over the hard­ware and soft­ware, as well as main­te­nance and upgrade sched­ules. It is an inter­nal plat­form and is more of a tra­di­tion­al SAP S/4HANA client man­age­ment solu­tion where you have flex­i­bil­i­ty and con­trol over customizations.

The cloud deploy­ment option breaks into two more choic­es: pri­vate or pub­lic cloud. If you’re run­ning on a pri­vate cloud—SAP Cloud Plat­form or a part­ner-man­aged cloud — this is sim­i­lar to the on-premise ver­sion. You have con­trol of the appli­ca­tion. You can do thor­ough con­fig­u­ra­tion and cus­tomiza­tion, and you can install what you want onto your SAP S/4HANA platform.

The pub­lic cloud option, which is a mul­ti­tenant choice, is a soft­ware as a ser­vice (SaaS) mod­el where there are quar­ter­ly updates that you must take on. It is a fit-to-stan­dard approach, and there­fore a very dif­fer­ent SAP S/4HANA sys­tem in terms of func­tion­al­i­ty, matu­ri­ty, objec­tives, and so on that clients need to fac­tor in.

The third deploy­ment is the hybrid option, which is a com­bi­na­tion of both on-premise and cloud deployments.

When it comes to what’s the right way to decide, I think you need to look at under­stand­ing your exist­ing pain points and busi­ness chal­lenges. What are you try­ing to solve with SAP S/4HANA and would any of these deploy­ment options help achieve that? Are you look­ing at a fit-to-stan­dard approach? Is stan­dard­iza­tion one of your key pri­or­i­ties? Do you real­ly want to run SAP as a SaaS mod­el going for­ward? Are indus­try solu­tions a com­po­nent for you? What about your secu­ri­ty? Do you need cus­tomized process­es or not? You need to ask all of these these ques­tions fac­tor the answers into your decision.

Sharon: How can cus­tomers keep up with new func­tion­al­i­ties avail­able in SAP S/4HANA Cloud? What are some com­pelling rea­sons why cus­tomers would want to deploy in the cloud?

Asid­hara: SAP S/4HANA Cloud has quar­ter­ly releas­es with dif­fer­ent func­tions for dif­fer­ent coun­tries being churned out con­tin­u­ous­ly. SAP offers What’s New View­er, an online resource to help you under­stand what the cur­rent release includes.

As for why cus­tomers should con­sid­er SAP S/4HANA Cloud, it comes back to inno­va­tion. SAP is focused on push­ing out all inno­va­tions through its cloud solu­tions first. The cloud option pro­vides a fit-to-stan­dard solu­tion imple­men­ta­tion with very few cus­tomiza­tion require­ments and allows for a faster time to mar­ket. Last, but not least, it is a more cost-effec­tive approach.

Sharon: What kind of indus­try solu­tions are avail­able and how do they help with an SAP S/4HANA implementation?

Andrew: SAP has made it a pri­or­i­ty to pro­vide more func­tion­al­i­ty with­in each new release of SAP S/4HANA. The goal is to move the indus­try solu­tions that once were add-ons to SAP ECC into the core of SAP S/4HANA. This allows users to apply mul­ti­ple indus­try solu­tions on the same instance with­out caus­ing con­flict. This new approach is often referred to by SAP as the ​“indus­try-to-core” concept.

Some of the indus­try solu­tions avail­able include oil and gas, retail, fash­ion man­age­ment, aero­space and defense, auto­mo­tive, and bank­ing. All of these have dif­fer­ent lev­els of matu­ri­ty, and some of them have restrictions.The SAP notes high­light the restric­tions for each of those industries.

One of the big dif­fer­ences here is that you’re in a posi­tion now to com­bine mul­ti­ple indus­try solu­tions in SAP S/4HANA. So, for exam­ple, an oil and gas SAP cus­tomer can acti­vate retail at the same time.

SAP is also look­ing to pro­vide the abil­i­ty to acti­vate sev­er­al busi­ness func­tions with­in some of these indus­try solu­tions that weren’t avail­able before. So, when you look at what you’re get­ting out of SAP S/4HANA, it’s the abil­i­ty to extend and expand what you can do with your ERP.

Sharon: How does SAP S/4HANA work with oth­er SAP prod­ucts and ser­vices such as SAP Ari­ba, SAP Field­glass, SAP Con­cur, SAP Suc­cess­Fac­tors, SAC C/4HANA, and SAP Leonardo?

Asid­hara: Today’s land­scape is a hybrid of sys­tems. You have SAP S/4HANA as the core, but then you also have all the SaaS prod­ucts like SAP Ari­ba, SAP Field­glass, SAP Con­cur, SAP Suc­cess­Fac­tors, and SAP C/4HANA. And then you have SAP Leonar­do, which is a ser­vice that pro­vides addi­tion­al inno­va­tion solutions.

Each of the SaaS solu­tions address spe­cif­ic func­tions — net­work and spend man­age­ment, peo­ple man­age­ment, man­u­fac­tur­ing and sup­ply chain man­age­ment, and cus­tomer expe­ri­ence — but can be com­bined in an intel­li­gent suite. The true val­ue comes with end-to-end integration.

Sharon: Can you sum­ma­rize ​“SAP S/4HANA: An Intro­duc­tion” in a cou­ple of sentences?

Andrew: The book will help you nav­i­gate through your SAP S/4HANA jour­ney. It helps you under­stand how and where to start, how to build your busi­ness case, and what func­tion­al­i­ty is avail­able based on the release you’re try­ing to move toward. It also helps you under­stand what the best adop­tion options are for you, and then which meth­ods are avail­able as part of the deployment.

The book is real­ly your one-stop shop that cov­ers your SAP S/4HANA road map from start to finish.

ASUG Mem­bers can log into their accounts to get their dis­count on the SAP S/4HANA: An Intro­duc­tion book from SAP Press. If you’re plan­ning to attend SAP­PHIRE NOW and ASUG Annu­al Con­fer­ence, don’t miss the day of learn­ing about Mov­ing to SAP S/4HANA, A Prac­ti­cal Dis­cus­sion, an ASUG Pre-Con­fer­ence Sem­i­nar. Reg­is­ter today and save your spot.