Upgrading to SAP S/4HANA Cloud can be a massive, complex, and time-consuming process for any modern enterprise. For the Florida-based global manufacturing solutions provider Jabil, the secret to successful cloud migration was a “staged lift-and-shift approach,” focusing on moving to the cloud first and carrying out business process transformation initiatives second.
According to Cynthia Kendall, IT Director at Jabil, who recently discussed the company's SAP S/4HANA journey at ASUG Tech Connect in New Orleans, SAP solutions are at the core of Jabil’s vision to be one of the world’s most technologically advanced manufacturing solutions providers. With 250,000+ dedicated employees, 400+ customers across diverse markets, 100+ sites strategically located worldwide, and 27,000+ supply chain partners, Jabil is a large and growing enterprise. In 2022, the company generated $33.5 billion in revenue, which Kendall in part attributed to its solid foundation in SAP technology.
An SAP customer since 1998, Jabil started on an SAP R/3 3.1H environment, continually upgrading until it reached the on-premises SAP ECC 6.0, with enhancement pack 7, in 2016. Soon starting to age out, this ECC environment also did not align with the cloud-first strategy later implemented by Jabil’s CIO, and Kendall focused on moving to SAP S/4HANA Cloud as Jabil’s next phase of evolution.
Jabil’s S/4 Journey
In transitioning from SAP ECC to SAP S/4HANA Cloud across a three-year project, Jabil’s cloud adoption aimed to shift the company from traditional on-prem infrastructure to AWS cloud-infrastructure-as-a-service (CIaaS) and SAP HANA.
Its technology transformation involved upgrading from ECC to S/4HANA 1909 (completed in January of 2022), moving from the company’s 67 TB on-premises ECC environment – which had 40,000 users – to the 18 TB S/4HANA appliance after compression. “We had a huge increase in our transactional memory speed, due to in-memory process,” said Kendall.
Jabil’s extensive SAP landscape also included SAP Business Warehouse (BW) and SAP Secure Network Communication (SNC). Kendall’s team migrated these supporting applications first, to better evaluate the challenges of cloud migration before shifting more environments. SAP Global Trade Services, SAP Governance Risk and Compliance, and SAP Solution Manager followed soon after.
Jabil’s transformation project also required its IT team to address customizations that its ECC environment had built up over the years, which would neither transform for nor function within the more standardized SAP S/4HANA Cloud environment. Collaborating with the automation technology company smartShift Technologies Inc., Jabil was able to significantly reduce total cost of ownership by remediating code. “We had five million lines of custom code and realized that 1.5 million of those lines had not been used in a two-year period,” said Kendall. “We were able to decommission and delete that code.”
In addition, Jabil realigned more than 1,900 technical objects to the S/4 code and table set, and it successfully tested more than 180 integrated applications with SAP. The transformation ultimately involved 14 upgrades and migrations to the cloud, as well as 12 lift-and-shifts to the cloud.
Finally, to perform the crucial change-over to SAP S/4HANA, Jabil took advantage of SAP Near Zero Downtime through SAP MaxAttention, a premium customer support service. Its climactic cutover was performed with only 62 hours of downtime.
‘Noticeable Improvements’ from S/4 Transformation
Since go-live with SAP S/4HANA Cloud in January of 2022, the company has benefitted considerably from cloud migration, according to Kendall.
App server resizing, which took days in its on-premises ECC environment, can be achieved within hours in its SAP S/4HANA Cloud environment. Similarly, moving app servers between availability zones can now be accomplished in hours, as opposed to weeks.
More flexibility, better business redundancy, and increased system speed are all defining results of the SAP S/4HANA Cloud migration, which allowed Jabil to collapse its number of servers, move to larger systems, and shift from two data centers to three. Overall, “things are a lot quicker in the SAP S/4HANA Cloud environment, once you’re rolling with it,” Kendall said.
Increased processing speed across the business has been a particularly major improvement for Jabil since implementing SA S/4 HANA Cloud. For instance, the process for inputting SAP transaction codes (T-codes) to execute tasks in ERP systems is much more efficient. Kendall notes that requesting lists of open sales orders from Jabil's larger plants had formerly timed out in the on-premises system but now comes back in 45 seconds.
Tips for Change Management
Kendall believes that successfully carrying out such a multi-faceted cloud migration at Jabil required setting a manageable scope and sticking to it. “Keep the scope to a minimum, and don’t take on more than you can handle,” she said.
To that end, Kendall encourages staged lift-and-shift approaches that put cloud ERP migration ahead of business process transformation. “Land the airplane first, then worry about painting the outside,” she said. “Don’t try to paint it mid-flight.” By taking this approach to the migration, Jabil’s IT team was able to manage integrations, continuous archiving, and constant testing in a way that minimized risk and maximized benefits.
Kendall added that, internally, enhancing cross-team collaboration was essential. Leading a globally distributed team, including during the pandemic, Jabil utilized various tools for remote work, such as Microsoft Teams and SharePoint. The company ensured that its assigned S/4 transformation team was in constant communication, whether directly collaborating or monitoring and decommissioning unused technology and functionalities.
Fireside chats, podcasts, video recordings, and TV monitors set to each team’s native language also helped Jabil to keep its wider, worldwide base of employees informed of process transformations before they happened. A focus on partner expert resources, made available during hypercare hours, was another important part of Jabil’s organizational change management (OCM).
Kendall recommends that companies exploring cloud migration first examine potential pre-projects that can ease their workload later. Not all business leaders are currently on board with SAP S/4HANA Cloud transformation, which can leave IT departments frustrated as they attempt to move from on-premises systems and improve efficiencies. But even before transformation projects are approved, IT leaders can move their companies forward.
During the lead time before shifting its operations, Jabil's IT team went through pre-projects, from reducing database sizes through archiving to depreciating T-codes that will not function in SAP S/4HANA Cloud environments. “Even if you’re in a state of flux or cannot get funding, there are still numerous activities you can do today that will reduce your problems later,” Kendall said. “Start talking about what you can do today, to make your journey easier tomorrow.”
Catch Up with Jabil at an ASUG Conference
Kendall previously discussed Jabil’s transformation journey in multiple SAP, customer, partner, and ASUG Power Peer Group sessions at the 2023 SAP Sapphire & ASUG Annual Conference, in addition to discussing Jabil IT Advisory Services, a new practice to help other SAP customers succeed in their cloud transformation journeys.
At ASUG Tech Connect in New Orleans, Kendall further explored Jabil's move to S/4HANA, sharing lessons learned, discussing life after the upgrade, and discussing how SAP S/4HANA and the cloud have improved user experience and allowed Jabil to maintain cutting-edge relevancy. Additionally, Brian Silvestro, Director – Enterprise Solutions, SAP Technology at Jabil, and Harish Manohar, Senior IT Manager at Jabil, discussed life post-go-live at Jabil and reflected on how they've used SAP Signavio to identify gaps in legacy programs.