Migration to SAP S/4HANA – Wait or push ahead?

T-Systems’ jumpstart programme for SAP HANA. Source: Telekom.
Some have already migrated, others are in the process of doing so. Yet most SAP users are still wondering whether it makes sense to migrate to the new SAP S/4HANA? And, first and foremost, how and when? There is no magic formula for the migration. Rather the migration offers enterprises the opportunity to leave behind some legacy IT infrastructure and applications, thus future-proofing their business.

SAP S/4HANA is not simply a new release, but a technology and platform shift which will shape the business and IT landscape in many enterprises for years to come. As a result it is possible to restructure business processes and to implement new business processes. SAP thus paves the way for digitization, incorporation of Internet of Things applications, and business with real-time information.
The migration of the SAP Business Suite to the HANA technology is already in full swing in many enterprises. Shell, for instance, is working together with T-Systems on migrating 48 terabytes of data from more than 20 systems to HANA, including real-time information from sensors. Jay Crotts, CIO at Royal Dutch Shell, outlines where they are heading: “Shell runs 43,000 gas stations worldwide. The knowledge of who buys what and when still largely goes to waste.” This potential can be leveraged using real-time information from the HANA technology.

Scrutinizing every last detail

Despite these kinds of obvious advantages, migration to SAP S/4HANA is by no means an automatic process. Each enterprise needs to examine thoroughly whether and to what extent a migration is worthwhile. An overarching end-to-end analysis is recommended, which not only puts together a critical inventory for applications, but also includes the business processes and the IT infrastructure.
This kind of analysis for the migration should be done as early as possible. Support for the current SAP Business Suite may well be guaranteed through 2025. This clear-cut deadline for the migration, however, means that enterprises can now plan the necessary steps at their own pace, thus preventing the competition from getting ahead of them.

Migration as an opportunity for the business

The migration not only poses an IT challenge for enterprises, but offers a unique opportunity to scrutinize business processes across the enterprise. In this respect, SAP S/4HANA provides a lever which can, in turn, be used to set up a fresh, sustainably competitive business and process landscape.
The migration also offers the opportunity to standardize the processes used in the business, to push technologies forward and to replace some, or even all outdated in-house developments. This not only affects applications, but data too. A number of enterprises are still coming across old four-digit German ZIP codes in their data, even though these were phased out back in 1993. That is of course baggage that you cannot afford to take with you into the future. In addition to these kinds of simple decisions, more complex questions also emerge, particularly in the area of infrastructure: Does an enterprise aim in principle to retain computing capacity in-house or can it also envisage a private cloud or public cloud solution?

Fixed prices for predefined service packages help cut costs

Transformations and technology shifts always drive up costs. With its CLOUDIFIER approach, T-Systems offers a standardized transformation program. Enterprises that are nonetheless considering migrating their SAP landscapes to SAP S/4HANA and to the cloud, will find in CLOUDIFIER a reliable, simple and secure migration path with predefined service packages at fixed prices. The CLOUDIFIER offering for migrating to SAP S/4HANA thus offers a cost-effective alternative to in-house migration which costs much more.
Every enterprise is unique and is at a different point in the transformation process. If an enterprise is primarily looking to retain the more intuitive user interface of the Fiori apps in SAP S/4HANA, because it consistently needs to train large numbers of auxiliary staff on the systems in peak periods, it may make sense to migrate an existing SAP system to the new platform “simply” 1:1 as a start. If, however, an enterprise’s IT landscape has grown over the years and suffers serious performance problems due to numerous in-house developments, a 1:1 migration would be counterproductive. In this instance, it makes more sense to replace as many in-house developments with Fiori apps, so that sales staff, for instance, can now also access the functions of the new apps and real-time data with their smartphones.

Migration – but how?

Once these kinds of basic questions have been answered, execution can start in principle – if it were not for the uncertainty surrounding the necessary individual steps during the migration. And in fact many providers still do not have an established best practice in this respect. An overall two-stage approach has, however, already proven successful; before the actual migration, a test system is set up on the basis of SAP S/4HANA – with the particular customer’s actual data and processes. This customer can thus experiment with the new system before completing the actual implementation.
T-Systems, for example, dubs this process the Jump Start concept. Within a maximum six weeks, the particular customer receives a corresponding trial system. Only a few prerequisites apply. For instance, the existing SAP system must be running at least Service Package 7.0, be Unicode-enabled and the business partner and New General Ledger concepts should be implemented. A small amount of housekeeping also needs to be completed beforehand: What data should be migrated and what not? Enterprises can usually minimize risks by simply incorporating the data from the past two years into the trial system.

Conversion using SAP tools

Further preparations relate to the key business and IT processes. SAP has published migration guidelines in this respect, such as a simplification list. This list illustrates which processes have been modified in S/4HANA and how, and how existing processes can be converted to make them compatible with HANA.
Mainly SAP tools are used for the initial conversion; these tools include the Software Upgrade Manager (SUM), which supports the technical conversion of the information. To test the converted system subsequently, SAP also provides a catalog with predefined use cases – from Logistics, Purchasing through to Finance and Controlling.
With a touch of final fine-tuning of the new user interface, the Fiori apps and the access authorizations, the respective company is left with a Proof of Concept, which it can operate for four weeks and test with actual data. The final result is a report which all those involved analyze and discuss as part of a review workshop. They also usually define a business case for the specialist departments and senior management. If this report proves compelling, there is nothing stopping the actual migration to SAP S/4HANA.
Authors: Elena Maria Ordonez del Campo, Patrick Volny (T-Systems)