Varian Medical Systems operates out of more than 62 locations worldwide and employs more than 10,000 essential workers who keep the fight against cancer at the forefront of their day-to-day work. In 2017, Varian set out to transform its business from being a global leader in radiation therapy to expanding to what it calls its “Cancer Operating Platform” by 2022.
The goal is to provide service to more than 6 million patients seeking life-saving treatment. Varian plans to do this by using key trends and innovations in radiation therapy, advancing new treatment options, and increasing access to care across the globe.
ASUG spoke to Nagarajan Nallaiah, SAP technology manager at Varian, who walked us through the initial conversion to SAP S/4HANA in 2017 and the most recent upgrade to the 1909 release. We discussed the business case, challenges faced during the upgrade, and lessons learned throughout the project. Nagarajan has been responsible for the SAP landscape at Varian and was tasked with planning and executing an upgrade from SAP S/4HANA 1709 to SAP S/4HANA 1909.
Sharon: Which release of SAP S/4HANA did you originally go live with in 2018? And why did you decide to adopt SAP S/4HANA?
Nagarajan: We originally started our journey with SAP running an R3 system and then moving to SAP ECC about 10 years ago. We began the move to SAP S/4HANA with Suite on HANA, and then in 2018 we moved everything to SAP S/4HANA 1709.
As is the case for most large enterprises, Varian looks to keep par with new business demands and requirements. That gets difficult to do when we’re not keeping up with upgrades. One of the main reasons we started the journey to SAP S/4HANA was to make it easier to keep up with updates and to meet any challenge or demand from the business side of our operations. SAP S/4HANA allows us to do that more quickly and efficiently.
Sharon: What ROI did you achieve in the first two years of being on SAP S/4HANA 1709?
Nagarajan: We were able to immediately simplify our business processes. One area I can highlight is within finance. SAP merged financial costing into one component in SAP S/4HANA, and that has resulted in a reduced effort in the reconciliation side of finance. Another highlight is a reduction in our data footprint. Prior to moving to SAP S/4HANA, we were using close to 2 terabytes of data. Since moving, we have reduced that to about 1.2 terabytes.
Another area where we gained ROI is reduced dependency on our business warehouse and business intelligence systems. SAP S/4HANA comes with its own reporting and analytics features that we’ve been able to leverage and gain insights from. And the last thing I’ll mention is that we have improved our application delivery time, as well as optimized several transactions by enabling operational analytical features within SAP S/4HANA.
Sharon: What were the main reasons for the 1909 upgrade? What were you looking to achieve?
Nagarajan: The main driver for the 1909 upgrade was so that we can continue the track of business process simplification. SAP S/4HANA 1909 allows us to simplify and automate our business processes as much as possible, as well as leverage any of the new features offered by SAP—particularly robotic process automation (RPA) and other intelligent functions.
The plan is to upgrade every year so that, as a company, we are making small and gradual changes that will allow us to keep up with demands.
Sharon: What were the main challenges you faced, and how did you address them?
Nagarajan: SAP has introduced numerous new features in its SAP S/4HANA platform and obsoleted some of the old business functionalities. This caused many issues during the initial stage of the project. The project team worked with each function team and came up with a plan to mitigate the issues.
Another challenge is RICEF (reports, interfaces, conversions, enhancements, forms) objects code remediation due to BADI (Business Add-In) and obsoleted ABAP functionalities.
Sharon: What are some of the lessons learned that you can share with other organizations looking to implement an upgrade with SAP S/4HANA?
Nagarajan: We had several lessons learned, particularly around governance during the change phase, but also during the testing phase.
When you have a global business landscape, it’s likely that you will have different business processes within each country. When you’re getting ready to upgrade to a new release, at least in our case, we conducted testing on the core business processes in our corporate headquarters. As a result, we missed some country-specific issues and opportunities to address change management. For example, Poland has been introducing a lot of new regulations and the changes within SAP S/4HANA 1909 address some of these changes. But when we built our test case, we didn’t really include those changes because they were country-specific. That was a missed opportunity. One of the key lessons learned for us is that it’s important to define your test case in every instance where you have a system.
Sharon: In your opinion, what are the biggest challenges that the health care/life sciences industry is facing right now? How, if at all, did an SAP S/4HANA upgrade help in addressing those challenges?
Nagarajan: The biggest challenge in the industry right now is trying to keep up with demand and constant changes. By moving to SAP S/4HANA, we’ve been able to leverage intelligent technologies that have allowed us to do just that. We have been able to automate processes and use machine learning, predictive analytics, as well as a number of other intelligent technologies.
Adopting SAP S/4HANA, especially for organizations within the health care and life sciences industries, is a smart move if the goal is to be an intelligent enterprise.
Sharon: What are your biggest concerns or pain points related to technology and your job or industry?
Nagarajan: The biggest pain point for me is to be able to keep up with business demand and with advancements in technology. My role is to make sure we have the best data available and that we are gleaning from it the most important insights at the right time. And technology certainly makes that easier to do, but you need to fully understand the technology you are using in order to make the best use of it. Keeping up with that as it constantly changes is a pain point, but when you get it right, then it takes that pain away.
Don't miss hearing about Varian’s SAP S/4HANA upgrade project and learn more about best practices and lessons learned at our virtual event ASUG Best Practices: SAP for Industries Sept. 21–25. Register today.