Navigating the path to SAP S/4HANA

The need to transition to the new SAP S/4HANA system is clear – but choosing the right partner and implementation path is key to accessing the improved functionality.

Johannesburg, 04 Aug 2023

Two and a half years ago, SAP announced that by the end of 2027, it will cease the maintenance of SAP Business Suite 7’s core applications. Although customers of the existing version will have the ability to opt for extended maintenance lasting through to the end of 2030 – at additional cost and only if they already bought S/4HANA licences – most businesses have recognised the value of transitioning to the company’s new SAP S/4HANA system.

There are obvious benefits to such a move, notes Dimitri Denissiouk, MD at IBA South Africa. He points out that S/4HANA brings with it not only a range of new functionality, user-friendly design and a wide list of adjustable reporting functionality, but also an overall improved system performance, eased further maintenance and even lower TCO.

“For one thing, the new S/4HANA should significantly improve the user experience (UX) and speed up new users on-boarding, as well as the organisation’s business processes and accuracy, because they will now have a single source of truth,” he says.

“The new functionality also offers embedded analytics, intelligent robotic process automation (RPA), and leverages industry best practices. This, in turn, leads to increased revenue, cost reductions, greater customer satisfaction and more employee engagement.”

The transition to S/4HANA.
The transition to S/4HANA.

Denissiouk explains that for those wanting to transition to S/4HANA, there are three options available. The first is a SAP ECC system conversion, or Brownfield approach. The second option is a Greenfield – or completely new – implementation, and the final one involves selective data transition, also known as a Bluefield approach.

“The system conversion is a popular option, with just under 50% of all transitions occurring in this form. This is really about a conversion to the new system, without the need for a complete reimplementation of the whole system.

“The second option is also quite popular, with the main difference being that it is a brand new implementation. In other words, the old system is removed and S/4HANA is implemented from scratch. This method is often used when the system to be replaced is particularly old and comes with a lot of legacy baggage.”

The Bluefield approach, consisting of two scenarios: Shell Conversion and Mix and Match, is the rarest of the three, he explains, and involves selecting which parts of an existing ERP solution you want to re-use, and which you want to redesign, generally according to application area.

“While there are challenges with any such transition, everything from disorganisation to data complexity or inconsistency, the huge benefits obtained by the switch to S/4HANA inevitably make the transition efforts worth it. Remember, it’s about more than simply ensuring continued support from SAP beyond 2027, as there are several additional benefits.

“For example, it offers in-memory processing, which will deliver significantly increased performance and response times, leading to better user engagement. This increased performance also reduces the runtime for transactions, reports and even certain business scenarios. Functionally, meanwhile, it utilises best practices, offers embedded analytics for simulation and prediction, and delivers machine learning to enable automated processing,” he explains.

He notes that the IBA Group has extensive experience in all three scenarios outlined above, when it comes to S/4HANA implementations and conversions. With 25 years’ experience with SAP implementations and migrations, the company is well-positioned to assist with S/4HANA transitions, and even offers the IBA conversion pack, which is a turnkey SAP-certified conversion service.

“We will also perform a technical evaluation, which is a non-invasive readiness check that has no impact on your system, but delivers findings and deliverable actions. The business can then choose to either leverage our analysis to undertake such actions themselves, or they can utilise IBA to undertake the complete transition as an end-to-end service.

“The benefits of the transition to S/4HANA are obvious, while the advantages of utilising an expert service provider to assist with a complete transition are equally clear. Therefore, businesses undertaking this journey should definitely be talking to IBA,” he concludes.