We’re inch­ing clos­er to SAP’s 2025 end-of-ser­vice dead­line and com­pa­nies across North Amer­i­ca are eval­u­at­ing when they need to make the move to SAP S/4HANA. Yet, most are still strug­gling with one of the biggest bar­ri­ers to the new, intel­li­gent enter­prise enabled ERP — build­ing a strong busi­ness case.

As a glob­al CIO charged with not only build­ing a case, but mak­ing the move, I can shed some light on an approach to this chal­lenge and what to avoid in the process. But before I even get into what to include in the busi­ness case, who should be at the table, and any oth­er con­sid­er­a­tions, I need to stress the most impor­tant fac­tor: 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.

Every Prob­lem Needs a Solution 

Ask­ing for an upgrade just for the sake of an upgrade is not going to cut it. You’ll be faced with bud­get restric­tions and naysay­ers that fol­low the, ​“if it ain’t broke, don’t fix it,” men­tal­i­ty. Many com­pa­nies have this mind­set and are still run­ning ear­ly 2000 instances of SAP. So, why take that approach when you know you’ll be faced with roadblocks?

Focus on exist­ing busi­ness process­es first and ask ques­tions. Are your busi­ness process­es effi­cient and effec­tive, or are they frac­tured and siloed? Do they enable a lean and/​or agile orga­ni­za­tion? Can your busi­ness process­es adapt with your chang­ing com­pet­i­tive land­scape? Is your tal­ent pulling data out of SAP and manip­u­lat­ing it in spread­sheets? Can your exec­u­tives trust this infor­ma­tion and use data to dri­ve informed deci­sions? Are you able to beat your com­pe­ti­tion and become an intel­li­gent enterprise?

Bring SAP S/4HANA Along for the Trans­for­ma­tion Ride

Start by solv­ing your busi­ness issues and build in how SAP S/4HANA helps elim­i­nate the road­blocks and enables the pro­posed solu­tion. I’ve seen too many cor­po­ra­tions go out there and ask, ​“How do I build a busi­ness case on SAP S/4HANA?” The answer is, ​“you don’t.” Instead, focus on what it is you’re try­ing to achieve, and then bring SAP S/4HANA along for the ride.

When we went through the exer­cise at my com­pa­ny, we nev­er men­tioned ERP, we nev­er men­tioned SAP, and we cer­tain­ly nev­er men­tioned SAP S/4HANA. What we start­ed with was, ​“We don’t have sol­id data to make informed deci­sions. We don’t have the abil­i­ty to adjust our busi­ness process­es as our busi­ness con­di­tions evolve with­out a big effort toward cus­tomiza­tion.” We pur­pose­ly drove our efforts as a trans­for­ma­tion of busi­ness oper­a­tions. We pre­sent­ed that it takes new process­es, lead­ing tal­ent, busi­ness strat­e­gy, and enabling new tech­nol­o­gy to do it. Only after mak­ing that case did we bring into the con­ver­sa­tion that emerg­ing tech­nol­o­gy would not work with­in our exist­ing lega­cy envi­ron­ments. We said that SAP was the leader in our indus­try, and we should con­sid­er SAP S/4HANA as part of the solution.

Who’s at the Table? 

Typ­i­cal­ly, the busi­ness case is spear­head­ed by either the busi­ness func­tion with­in the cor­po­ra­tion that is try­ing to solve the need, the process team that is try­ing to help enable it, or by the IT/IS orga­ni­za­tion. One les­son that I learned ear­ly on as a CIO is that I or my IT/IS team can­not build the busi­ness case alone, and we don’t present any num­bers that finance has not agreed to.

So, before you even begin the process, bring in the finance team to help devel­op the busi­ness case. In most cas­es, it is the finance team that presents the busi­ness case to the board or CEO of the com­pa­ny. If the team does­n’t have direct knowl­edge of the how and why of it, you’re set­ting your­self up to fail.

Aside from the finance and IT/IS teams, you need to include busi­ness func­tion rep­re­sen­ta­tives at the table as well. All these play­ers are crit­i­cal to build­ing a sol­id case and should be involved from the very start.

Build­ing Blocks for Build­ing the Busi­ness Case 

Obvi­ous­ly when build­ing a busi­ness case, you need to include tim­ing, cost, and scope, but the most impor­tant thing to include is real­ly the ben­e­fit. Are you try­ing to gen­er­ate addi­tion­al growth? Are you try­ing to reduce oper­a­tional costs? Are you try­ing to increase your speed to mar­ket? Again, focus on the objec­tive and make sure it’s tan­gi­ble so you can build all of it into your busi­ness case. Then, be sure to include how it’s going to be measured. 

This goes back again to hav­ing rep­re­sen­ta­tion from all busi­ness func­tions at the table so they can each take own­er­ship of their objec­tives, whether it’s increas­ing sales or reduc­ing lag time. The end goal here is to have a sus­tain­able adop­tion of the solu­tion and you can only do that if every­one is at the table and the objec­tives are clear and measurable.

This makes your busi­ness case stronger. At my com­pa­ny, we will be able to go back to our busi­ness case and mea­sure each busi­ness func­tion by its orig­i­nal objec­tive and see what’s been achieved and what hasn’t. It changes the con­ver­sa­tions and holds every­one account­able to the over­all goals of the company.

Does Infra­struc­ture Matter? 

“What about infra­struc­ture?” I keep hear­ing that ques­tion. The truth is, I believe giv­en the speed and change with which tech­nol­o­gy evolves, we are prob­a­bly going to see infra­struc­ture become a pure com­mod­i­ty fair­ly soon. The tech­nol­o­gy that we’re using today will not be the same as we’re going to use, say five years from now. So, if we know tech­nol­o­gy is chang­ing at this pace, why do we real­ly care that much about what the infra­struc­ture solu­tion is any­more? Instead, I put more focus on ensur­ing we have a cyber­safe solution.

When focus­ing on the con­ver­sa­tion around infra­struc­ture, gear toward the cost of main­tain­ing it dur­ing the life cycle of the solu­tion the busi­ness process is tied to. If you know your busi­ness case has a three- to five-year life cycle, then all you need to con­sid­er is the three- to five-year infra­struc­ture cost.

It’s a Jour­ney, Rec­og­nize That 

Here’s a rad­i­cal thought for you: No one should focus on change man­age­ment. Change man­age­ment tra­di­tion­al­ly cen­ters around train­ing and inter­nal com­mu­ni­ca­tion on how to use the solu­tion. That’s great, but it’s not enough.

Shift your focus to ​“jour­ney man­age­ment,” which focus­es on the move­ment of where the cul­ture, the tal­ent, and the capa­bil­i­ties are today to where you want it to go. This is the only way you’ll have a sus­tain­able oper­a­tion in the future. It’s about cul­ture change. It’s about phi­los­o­phy change. Change man­age­ment is a sub­com­po­nent of the jour­ney man­age­ment. The jour­ney man­age­ment real­ly focus­es on how you’re mov­ing that pop­u­la­tion base, be it from the tech side or the user side and from how they do things today to how they have to do things in the future.

My Two Cents: Throw ​‘Em in Your Case 

When I think back to pre­vi­ous upgrades with SAP ERPs, whether it was from R2 to R3, or R3 to SAP ECC, it was eas­i­ly under­stood across the board. As we’re going from SAP ECC to SAP HANA, it’s not just about a new data­base archi­tec­ture, or new con­fig­u­ra­tion options — it’s a fun­da­men­tal phi­los­o­phy change in how busi­ness­es can lever­age and use SAP S/4HANA solu­tions. First, I sug­gest that you take a deep look into your busi­ness process­es and under­stand how you can lever­age SAP S/4HANA to improve them. To do that effec­tive­ly, you need to have team mem­bers who under­stand both the lean process­es in your indus­try and the real capa­bil­i­ties of the soft­ware solu­tions to enable them. And no one per­son has all that knowl­edge, so you will need a team of folks.

Last piece of advice: Do not allow cus­tomiza­tions. In our case, the pres­i­dent and I both have to approve all cus­tomiza­tions. And like the old drug cam­paign of the past, we ​“just say no!”

If you have a ques­tion and/​or have oth­er sug­ges­tions, please reach out to undercovercio@​asug.​com. If you’re an exec­u­tive, you can join us at our local and nation­al ASUG Exec­u­tive Exchange events to net­work with oth­er exec­u­tives look­ing to get more val­ue from their SAP systems.