Con­nect­ing tech­nol­o­gy with busi­ness out­comes has always been imper­a­tive to the suc­cess of the intel­li­gent enter­prise, but as dig­i­ti­za­tion and cloud migra­tion accel­er­ate the rate of change for SAP cus­tomers, today’s tech­nol­o­gy lead­ers con­tin­ue to seek insights into how best to piv­ot, adapt, and trans­form their operations. 

Pierre-Fran­cis Gril­let is the glob­al lead for SAP Ser­vices at Soft­ware­One, a Swiss-based ser­vices provider that serves SAP cus­tomers in the US, Europe, and Asia/​Pacific regions. A 30-year vet­er­an of the SAP ecosys­tem, Gril­let pre­vi­ous­ly held roles as a glob­al CIO, an SAP employ­ee focused on con­sult­ing and val­ue engi­neer­ing in Asia/​Pacific, and a long­time con­sul­tant and sys­tems integrator. 

EAC ana­lyst Josh Green­baum, a reg­u­lar ASUG News + Views con­trib­u­tor, recent­ly sat down with Gril­let to dis­cuss the state of the SAP ecosys­tem and how ASUG mem­bers can nav­i­gate the com­plex choic­es they face in dig­i­tal trans­for­ma­tion with SAP. 

Under­stand­ing the SAP Ecosys­tem and How It Affects Cus­tomer Expe­ri­ence in Business 

This con­ver­sa­tion has been edit­ed and condensed.

Q. What is your sense of the state of the SAP com­mu­ni­ty? How are the customers?

A. The first reac­tion that comes to mind is ​“com­plex­i­ty.” I don’t think cus­tomers were pre­vi­ous­ly exposed to the num­ber of choic­es they have today. The tran­si­tion from SAP R/3 4.6c and ECC, for exam­ple — pre­vi­ous­ly the major gen­er­a­tion chal­lenge in terms of SAP soft­ware — was straight­for­ward. Today, there are a mul­ti­tude of choices. 

The first choice per­tains to infra­struc­ture: Are we stay­ing on-premis­es? Do we want to move to a pub­lic cloud? Do we want to go to a pri­vate cloud? Do we want to exit the pri­vate cloud that we have to go to anoth­er solu­tion? Or do we go to RISE with SAP, which is a dif­fer­ent type of pri­vate cloud? The sec­ond choice relates to how cus­tomers can con­sume the SAP S/4HANA license. Do you con­tin­ue to use the tra­di­tion­al on-premis­es license with ongo­ing main­te­nance? Or do you sub­scribe to RISE? What con­trac­tu­al rights can you trans­fer to S/4? How do you nego­ti­ate the right licens­ing? These are com­plex problems. 

The third choice that cus­tomers have to make is to jus­ti­fy the move to S/4: What do we want to get out of this? Is it a major trans­for­ma­tion? Or we are look­ing more at mod­ern­iz­ing the exist­ing SAP assets and mak­ing sure that we are geared up for ongo­ing inno­va­tion? What is the pace of trans­for­ma­tion that should be adopt­ed? How do I get sup­port from my orga­ni­za­tion, from busi­ness stake­hold­ers? What is it going to cost, and can I jus­ti­fy that? 

You also have more tech­ni­cal choic­es. Do I do this in two steps to min­i­mize the risk, going to the cloud first and doing the S/4 con­ver­sion lat­er? Do I want to do both steps in a sin­gle go, to lift and shift? Or do I focus on imple­ment­ing some min­i­mal changes upfront, because it’s going to be dif­fi­cult to make those changes lat­er on? If you put these all togeth­er, the SAP customer’s roadmap to the cloud has nev­er been as com­plex as it is today. 

Q. Some cus­tomers jus­ti­fy S/4 migra­tion to pur­sue tech­ni­cal trans­for­ma­tion; oth­ers see it as a part of busi­ness trans­for­ma­tion. The choice can be con­tro­ver­sial. When a cus­tomer approach­es you and says that they just want to lift and shift, that they don’t care about busi­ness trans­for­ma­tion and they don’t even want to think about it, what’s your advice? 

A. It’s always impor­tant to respect what the cus­tomer wants. Maybe they want to sell an enti­ty, and it’s impor­tant to go to S/4, but they don’t want to make any changes. In gen­er­al, I would at least ask the ques­tion, ​“Would you con­sid­er some of the changes that real­ly make a dif­fer­ence in S/4HANA? Are you open to mak­ing some changes now that will ben­e­fit you lat­er, and that will be more dif­fi­cult to do after you go live?”

Incor­po­rat­ing All That Dig­i­tal Trans­for­ma­tion Involves: Includ­ing Real Time Upgrades and Updates

Q. It’s hard to upgrade, and then it’s hard to stay up-to-date and main­tain a sys­tem after an upgrade. Talk to us about the con­tin­u­ous upgrade problem.

A. Ongo­ing inno­va­tion is fan­tas­tic. Who does­n’t want ongo­ing inno­va­tion? The chal­lenge is when you bring this to the lev­el of com­plex­i­ty and inte­gra­tion of an SAP envi­ron­ment. There are a mul­ti­tude of inter­faces with exter­nal sys­tems, and those exter­nal sys­tems will not nec­es­sar­i­ly behave well rel­a­tive to the changes you make in your core sys­tem. You also have peo­ple, and you have data, and you need to con­sid­er the impact of all these dimen­sions. Small­er orga­ni­za­tions that typ­i­cal­ly would be the tar­get for S/4HANA Cloud, pub­lic edi­tion, where inno­va­tions are being shipped every quar­ter, are not like­ly to be the best equipped for [man­ag­ing this change].

Q. If you’re a small­er com­pa­ny pur­su­ing a pub­lic cloud imple­men­ta­tion, should it be wall-to-wall SAP, or as SAP-cen­tric as pos­si­ble to lim­it poten­tial complexity? 

A. The days of say­ing ​“we’re just going to be wall-to-wall SAP, because that’s the eas­i­est way to ensure inte­gra­tion” are over. One of the rea­sons is that your sys­tem is no longer with­in the four walls of the orga­ni­za­tion. The sys­tem inter­op­er­ates with the exter­nal world, and you can’t expect every­one to apply that principle. 

In addi­tion, the busi­ness wants to be able to pro­cure the SaaS solu­tion that meets their require­ments, and they’re not inter­est­ed in hear­ing about any restric­tions. They will take inte­gra­tion as a giv­en and insist that the IT orga­ni­za­tion pro­vide a plat­form that ensures the smooth, seam­less inte­gra­tion of what­ev­er solu­tion they need to buy because it meets their busi­ness requirements.

Cus­tomized Ser­vice With SAP Data Trans­for­ma­tion and The Move to SAP S/4HANA

Q. I heard two inter­est­ing pre­sen­ta­tions at a recent ASUG Chem­i­cals Indus­try con­fer­ence. The pre­sen­ters said that they believe in fit-to-stan­dard and the use of stan­dard­ized process­es, but at the local lev­el, local­iza­tion makes fit-to-stan­dard hard. What’s your take on this?

A. All projects start with the prin­ci­ple that we will adapt to the soft­ware, not change it. But I haven’t seen a sin­gle project where you don’t end up with more cus­tomiza­tions than antic­i­pat­ed. There will always be a need to do some. Should cus­tomers lim­it their cus­tomiza­tions? Absolute­ly, yes. Can BTP mag­i­cal­ly solve that prob­lem by keep­ing the core clean? Yes, you will have a clean core. But it does­n’t nec­es­sar­i­ly mean that all the chal­lenges you had before will disappear. 

Q. The clock is tick­ing on S/4HANA migra­tion. But for many cus­tomers, there’s nei­ther the time nor the mon­ey, nor enough sup­port staff, to move every­thing off ECC by the 2027 dead­line. On the oth­er hand, cus­tomers have all kinds of com­pet­i­tive and reg­u­la­to­ry pres­sures, and they just can’t sit still. What do you say to cus­tomers that are try­ing to bal­ance this? 

A. There is no easy solu­tion, and there is no sil­ver bul­let. What I will say is prob­a­bly obvi­ous and not ground­break­ing, but it’s all about plan­ning. As I said, the deci­sions are com­plex. So, you need to plan, take the time to sit down and under­stand what choic­es you will have to make. The worst thing that can hap­pen is that you make these choic­es as you go or you don’t think them through, and then you real­ize too late that you made the wrong choice. 

But don’t wait. It’s only going to get hard­er because there will be less time avail­able to do things and few­er resources on the mar­ket, because every­body will be in a rush to do it at the same time. 

Putting The Right Peo­ple On the Right Dig­i­tal Trans­for­ma­tion Jour­ney Projects

Q. Let’s talk about peo­ple. We hear a lot about how part­ners pro­vid­ing ser­vices have to deploy skilled indi­vid­u­als rather than train­ing new employ­ees on the job. But what about the cus­tomer’s require­ment to put the right peo­ple on the right projects? 

A. The type of jour­ney that you under­take will dic­tate the skills and the demands that you place on the busi­ness com­mu­ni­ty. Free­ing up busi­ness people’s time is nev­er an easy busi­ness. You need to bring the experts. You want the sharpest brains to inform the trans­for­ma­tion, val­i­date the best choice in terms of design, ensure you’re build­ing cor­rect­ly, and encap­su­late all the knowl­edge these peo­ple have. 

The smarter orga­ni­za­tions are those that plan in advance. They incu­bate tal­ent before the project so that their peo­ple have the knowl­edge, then they ded­i­cate them to the project. Those peo­ple are well-equipped to take respon­si­bil­i­ty to dri­ve the ben­e­fits expect­ed from the sys­tem, because they’ve been part of the trans­for­ma­tion. And they’re account­able for the work they do because they have to derive the ben­e­fits lat­er on. But it’s not easy. And, again, plan­ning for that is important.

Q. Speak­ing of peo­ple, change man­age­ment is essen­tial, yet it’s typ­i­cal­ly not done as well as it should be. How do you bal­ance the need for change man­age­ment in a project?

A. It’s dif­fi­cult because most busi­ness cas­es are dri­ven by finan­cial ben­e­fits. That’s real­i­ty: you jus­ti­fy an invest­ment by its finan­cial ben­e­fits. You’re going to have sav­ings because you have less mav­er­ick pro­cure­ment, because you con­sol­i­date your ven­dors, because you dri­ve dif­fer­ent behaviors.

At the same time, the best lever for suc­cess that orga­ni­za­tions have is the lev­el of engage­ment of their peo­ple. If you can increase engage­ment by 10%, that’s going to be mas­sive. This should be the num­ber one objec­tive of an orga­ni­za­tion: how do I dri­ve the lev­el of engage­ment high­er? I think the smart orga­ni­za­tions have man­aged to blend the two. They’ve man­aged to link change man­age­ment with the whole ben­e­fits real­iza­tion stream. For me, the two are meant to work togeth­er, because the busi­ness case and busi­ness ben­e­fits should form the ​“why” and the change man­age­ment then artic­u­lates the next ques­tion: ​“What’s in it for me?” If you don’t have a ​“why,” it becomes a bit the­o­ret­i­cal to try to look at that sec­ond ques­tion. ​“What’s in it for me” is hard­er to sell; peo­ple are afraid because of what they think is going to hap­pen with their jobs. 

What’s essen­tial is how you bring the two togeth­er. I remem­ber a sur­vey from 20 years ago that list­ed the main caus­es of fail­ure for ERP projects, and these were, in order, a lack of change man­age­ment, lack of train­ing, poor adop­tion, lack of respect of the rules, peo­ple find­ing short­cuts in the sys­tems, and data qual­i­ty. The infra­struc­ture and the soft­ware were the least respon­si­ble for achiev­ing ben­e­fits. The sur­vey then asked, ​“Where do you plan to invest in the next five years?” The list of cri­te­ria was com­plete­ly turned around, it was all about invest­ing in tech­nol­o­gy and soft­ware. Change man­age­ment and train­ing were at the bot­tom. It’s real­ly hard to make the case for change man­age­ment, even though it is such a pow­er­ful lever.

Q. Anoth­er big top­ic is het­ero­gene­ity. SAP is final­ly rec­og­niz­ing that cus­tomer land­scapes are com­plex, and the SAP Busi­ness Tech­nol­o­gy Plat­form is part of that recog­ni­tion. What do cus­tomers need to do to make sure that they’re using BTP correctly?

A. BTP cov­ers inte­gra­tion. It cov­ers all the data and ana­lyt­ics require­ments, and then it sup­ports inno­va­tion with new tech­nol­o­gy, IoT, machine learn­ing, and so on. It’s used dif­fer­ent­ly by cus­tomers depend­ing on their demands. Cus­tomers need to under­stand, tech­ni­cal­ly and com­mer­cial­ly, what the respec­tive ben­e­fits are in build­ing inno­va­tion on the hyper­scaler inno­va­tion plat­forms, as opposed to on BTP. 

And it’s not sim­ple. The pric­ing log­ic for BTP is dif­fer­ent depend­ing on the use case. Cus­tomers need to edu­cate them­selves to under­stand what those pric­ing met­rics are and do an eval­u­a­tion to com­pare them from a tech­ni­cal stand­point and a com­mer­cial per­spec­tive. What does it look like in an SAP world, and what does it look like in a hyper­scaler world? I think the answer will be that it depends. Some things will be bet­ter built on the hyper­scaler world, some things will be bet­ter in BTP. 

Q. What’s your final advice for cus­tomers and ASUG members? 

A. Reflect­ing on our dis­cus­sion today, on the com­plex­i­ty of the choic­es cus­tomers have to make, on the time remain­ing, and on the impor­tance of plan­ning and prepa­ra­tion to make full use of that time, my clos­ing thought is that there’s not one minute to lose. Cus­tomers need to get start­ed on the jour­ney because it’s com­ing. We see a lot of cus­tomers push­ing this out because it’s not a pri­or­i­ty. I think they’re just cre­at­ing more pain for them­selves in the future. 

Joshua Green­baum is prin­ci­pal at Enter­prise Appli­ca­tion Consulting.