Migrating to SAP S/4HANA is a large undertaking and a potentially disruptive process. Choosing the right implementation strategy, analyzing your current processes, and moving your data over to a new ERP system can be a big, cumbersome project if you don’t plan for an SAP S/4HANA move appropriately. Before you do anything, it is necessary to build a business case that will not only bring on board all the stakeholders, but also help to guide the project along.
Key decision-makers need to know what the inherent advantages of the upgrade are, and more importantly, how the business will benefit from the change. It’s easy to get shortsighted or have a narrow scope when creating the business plan. But in the long run, focusing on the big picture and solving known issues will help you get your business case to the finish line.
In our series, the ASUG Undercover CIO stated that, “Your business case is not about upgrading to the newest technology. Your business case is about solving existing business issues in a new and improved way.” So, SAP S/4HANA isn’t the endgame—it’s the tool you need to get to the next level.
Why SAP S/4HANA: Start Where It Hurts
The best place to begin your business case is to identify pain points. What exactly are the weaker parts of your workflows and processes that you are trying to improve? What new technologies are you looking to adopt? How are you collecting, managing, and using your data? How is your organization competing—or not—in a digital economy?
Once you’ve identified the challenges your organization is facing, focus on how you want to improve them and how you will use SAP S/4HANA to do that. Discuss the business-value drivers of each improvement as it relates to the organization’s business goals. Include the specific functions and capabilities of SAP S/4HANA and how these new functionalities will bridge the gaps in your current business processes.
SAP offers several free resources to help analyze your business and technical environment and identify some ways SAP S/4HANA brings value to both.
SAP S/4HANA: Building Your A-Team
The fastest and most effective way to identify challenges within business processes is to include business users in the discussion. It is equally important to include your IT and finance teams as well. The table has room for all the stakeholders, and with participation comes buy-in.
According to the ASUG Undercover CIO, “If the teams don’t have direct knowledge of the how and why of it, you’re setting yourself up to fail.” Every business function has its own business processes—and potentially its own objectives. You need to have an overarching business objective and find a way to align everything, including the business case for SAP S/4HANA, to that objective.
But it’s not just about improving business processes. Understanding your current landscape and how you want that to change needs to be part of the conversation as well. Does your organization want to go to the cloud? Having IT at the table will not only help move this conversation along, but it can also help you realize possibilities you weren’t even considering.
SAP S/4HANA: The Cost to Move
Now that you’ve identified the cost of not moving to SAP S/4HANA—whether that’s having to deal with outdated and time-consuming processes or actual missed opportunities for business growth as well the people who can keep the project moving—the next step is to calculate the cost of making the move. As part of this process, you should include the costs of:
- Licenses and software
- Implementation (learn more about your options for SAP S/4HANA implementations)
- Working with systems integrators or consultants
- Maintenance and support
- Testing and training
In a series on “How to Avoid an SAP S/4HANA Disaster,” John Belden, project execution audit practical lead at UpperEdge, told us that you need to have independent evaluation of the budget up front. And he added, “You need to have a fact-based analysis of the contingency, and you need to consider contingency win-back tactics within the project itself.”
SAP offers resources like SAP Transformation Navigator and SAP S/4HANA Readiness Check to help you understand sizing and licensing requirements for your proposed road map. There will be always be unknowns that pop up, but if you know your objectives up front and you’ve allocated some budget for addressing the unknowns, then it’ll be a lot easier to manage throughout your project.
SAP S/4HANA: Managing the Journey
In addition to business-value drivers and costs, an equally critical component of your SAP S/4HANA business case should be to address change management. Moving to SAP S/4HANA isn’t going to be fast or cheap. Understanding how everyone within the organization will be affected and how to communicate the changes will not only help in moving the project along, but it will also help in keeping aligned with the road map and business objectives.
According to the ASUG Undercover CIO, you should “focus on the movement of where culture, talent, and the capabilities are today, and then on where you want it to go from there.”
In the same vein, as you build your business case, think about where your organization and its capabilities are today, and then think about where you want to take it from there.
Learn more about the different flavors of SAP S/4HANA or what free SAP S/4HANA resources are available for your implementation project. Also, learn how SAP S/4HANA becomes intelligent and changes user engagement to help you reimagine your business. Register for the on-demand ASUG webcast, “SAP S/4HANA: Road Map, Overview, and Strategy for SAP S/4HANA.”