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SAP S/4HANA transformation: determining strategic guidelines

How companies can identify which strategy is most suitable for their SAP S/4HANA transformation and promises the greatest added value

13. July 2022Hannes Ziegler

Setting the course for business success

No time to waste: companies using SAP should switch to SAP S/4HANA by the end of 2027, when support for the predecessor system SAP ECC will end. Long before the actual conversion, it is important to establish the strategic guidelines for the SAP S/4HANA transformation. These provide the framework for determining the most suitable target architecture, transformation path, and operating model, as well as for more efficient processes and long-term business success.

Achieve clear goals through the transformation

A businessman giving a presentation in the office

In order to successfully carry out SAP S/4HANA projects, it is important to set them on the right track during the initial planning stages, so that they are on the road to success. A preliminary evaluation and the creation of a roadmap help to identify the optimal path into the world of SAP S/4HANA. The specifics of the company and the goals it wants to achieve should always be taken into account. Alongside the technical parameters, it is also important to consider the strategic goals being pursued by the company with the changeover. For example, standardizing or centralizing as much as possible so that all subsidiaries can be integrated into the new SAP landscape in the future.

Professional advice before starting the project

As part of value consulting, T-Systems draws up a customized project plan for the companies with important milestones for the introduction of SAP S/4HANA. The preliminary evaluation and "roadmap consulting" include budget estimates for internal and external expenses. T-Systems' SAP experts also determine what added value the company will be able to achieve through the transformation.

Especially important: all stakeholders should be involved in the planning process right from the beginning. This is because a successful SAP S/4HANA transformation paves the way for sustainable development and future innovations. That's why the kick-off for T-Systems' value consulting always involves not only the IT managers and the business specialists, but also the company management.

Data migration and housekeeping

Beyond the strategic guidelines, the success of SAP S/4HANA projects hinges on thorough preparation. Key questions must be clarified before the project even begins: What will happen to the existing digital data? Should they be archived or cleaned up and transferred to the new system? It is also important to do the technical homework as part of housekeeping and, for example, to import necessary updates to facilitate the transition to SAP S/4HANA.

What exactly happens in value consulting?

The pivotal point is a joint workshop with the customer. This involves a technical analysis of the SAP landscape by the T-Systems consultants that takes all the special features into account. With the results, they then identify suitable transformation approaches and discuss them with the customer. Finally, they work together to determine what the SAP target architecture will look like and which milestones will be needed to achieve it.

The company can then use the recommendations to start their SAP S/4HANA project. T-Systems remains on board as a trusted advisor following the preliminary evaluation and supports the company throughout the transformation. When implementing the roadmap, T-Systems' consulting and delivery teams work in tandem to ensure that the recommendations are implemented and the roll-out is successful.

Clear benefit increases willingness to invest

In order for the customer to benefit from as many advantages of the SAP S/4HANA transformation as possible, the consultants identify which path promises the greatest benefit: a brownfield approach, where the existing SAP system is transferred to the SAP S/4HANA world? A greenfield approach in which the existing SAP processes are reviewed and optimized? Or a hybrid solution such as Selective Data Transition (SDT), which incorporates both approaches?

All companies have their own structures and pursue their own goals in their SAP S/4HANA transformation. Sometimes it's about using new digital functions. Or perhaps the customer wants to optimize their business processes and help their employees to be faster, more efficient, and more productive. However, one thing is true for almost all companies: The more advantages the transformation entails and the more clearly identifiable the benefits are, the simpler and quicker it is to convince stakeholders to invest in the transformation project.

Cloud and SAP – a good match

Choosing the right operating model is also crucial. More and more companies that use SAP are turning to the cloud and putting their trust in Infrastructure as a Services (IaaS) or Software as a Service (SaaS). That is why cloud assessment is an integral part of value consulting. In each preliminary evaluation, T-Systems examines the potential that cloud computing offers to the customer. This covers the entire spectrum of the cloud world – from the basics of the technology to the future big picture of SAP operations in the cloud, always tailored to the customer's current situation.

Last but not least, it's worth putting business processes to the test during the SAP S/4HANA transformation. Business Process Intelligence (BPI) is a promising approach to documenting, analyzing, and modifying processes. The process is particularly well suited to the greenfield method, in which the client can bid farewell to inefficient processes and set up new, improved processes in their place.

About the author

Hannes Ziegler

Head of Value Consulting, T-Systems International GmbH

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