CxOs: thinking S/4 HANA migration? Think first about assessing risk
According to SAP, S/4 HANA migration is the fastest upgrade cycle in its history. Just over one-third of its customers have concrete plans to migrate to S/4 HANA and another third are currently discussing it. A majority of customers are convinced about its benefits and are able to visualise this important milestone in their digital transformation journey roadmap.
However, fear of business disruption is one of the biggest challenges and is prohibiting the adoption for the CxOs. For example, with four layers of SAP architecture that impacts the business for more popular cloud version of S/4 HANA, there will inevitably be a multitude of changes that can profoundly impact business processes during migration to the SAP S/4 HANA solution.
Regardless of industry, CxOs and SAP leaders must understand the role and importance of impact assessment and QA in order to minimise disruption during and immediately after S/4 HANA migration. If your company is embarking on a step EhP upgrade or a full S/4 HANA migration or re-implementation of S/4 HANA, keep in mind that staying ahead of disruption requires proactive planning, communication and collaboration.
Impact assessments, QA health checks, testing minimises risk, disruption
SAP migrations are complex, regardless of industry. For automotive manufacturers as an example, risk and complexity are driven by the SAP system's tight integration of hundreds of critical business processes. From planning and production to vendor and dealer management, a flawed functionality in any one area has the potential to alter how the entire business operates.
The benefits of the many new features in S/4 HANA ERP are tremendous (eg, fast in-memory computing enables MRP runs in seconds or minutes instead of hours) and their value is an integral part of the CIO's digital transformation journey. However, it is imperative that both business and IT leaders have a complete understanding of potential complications arising from their current solution - particularly with customisations and interfaces. This understanding should be compared with S/4 HANA offerings in order to identify the impacted configurations and business processes.
There are other unique challenges that impact migration risk, for example, extra-large transactional databases, an inclination for extensive extended customisation, complex software application landscapes, and 365 x 24 x 7 operations all reinforce the need for a thoughtfully planned, comprehensive QA process.
Assessing risk impact is top priority
To stay ahead of risk, it is mandatory that key members from the business, IT and management teams collaborate to conduct a functional and technical impact assessment.
A thorough impact assessment provides end-to-end project visibility, making it one of the most critical steps in the S/4 HANA migration transformation journey. Not only does it enable better and less risky project management, it also serves as a reference as you engage a systems integration partner for actual migration. A proper assessment addresses issues such as critical custom functionality to be retained in the target version, new functionality to be configured and new functionality requiring further customisation to suit your unique business processes.
For the business, a risk assessment health check provides the insights that enable stakeholders to evaluate the potential for disruption as well as the impact on business growth and stability. For IT, the assessment provides clarity on the technical and functional impact of migration and helps to identify the end-to-end scenarios that form the basis of a bullet-proof QA plan. It also provides visibility into training requirements for internal business analysis, security and development teams, as well as the need for outsourced support.
Planning ahead prevents unnecessary costs, rework, extended downtime
Because of the rapidly evolving scope of migration planning, CxOs often struggle to balance the adoption risks against the potential benefits of S/4 HANA. Far too many organisations underestimate the level of work and planning required for a successful implementation and suffer the consequences.
To fully enjoy the many benefits of modernised and futuristic S/4 HANA software, CxOs must plan early to stay ahead of common - but costly - pitfalls. Commitment to implementing a bulletproof QA process can often mean the difference between a successful outcome or one that leaves stakeholders frustrated and disappointed.