SAP S/4 HANA - How Do I Prepare as IT for This Project?

The decision for an SAP S/4 HANA project is a significant step for any company. The transition from a traditional SAP ERP system to S/4 HANA brings both challenges and opportunities. For the project to be successfully implemented, the IT department must address a variety of topics early on. In this blog post, I will examine some of the central questions and considerations that IT must take into account when planning and implementing an S/4 HANA project. A complete view would exceed the scope of a single blog post.

1. Know-how: Does IT Already Have the Necessary Knowledge or Must It First Be Built Up?

One of the first questions the IT department must ask itself is whether it has the required know-how to implement an S/4 HANA project. SAP S/4 HANA brings numerous new technologies and concepts that may not already exist in every company.

• Fiori: With the introduction of S/4 HANA, SAP Fiori moves to the forefront as the preferred user interface. Unlike the classic SAP GUI, Fiori offers a more modern, role-based user experience. IT must ensure it has knowledge in customizing and implementing Fiori apps.
• Authorizations: The authorization concept in S/4 HANA has changed compared to older SAP versions. Roles and authorizations must be adapted to correctly control both the new features of Fiori and backend processes.
• HANA Database: S/4 HANA is based on the HANA database, an in-memory database technology specifically optimized for high-speed queries. IT staff should be familiar with the technical differences and data modeling in HANA to optimally use the system landscape.
• Process Changes in S/4: S/4 HANA offers many process changes and optimizations compared to classic SAP ECC. It is important to understand how these changes affect existing business processes and what adjustments are necessary.
• Interfaces & SAP CPI: In a networked world, interfaces are a central component of every SAP system. SAP CPI (Cloud Platform Integration) offers a modern integration platform to connect cloud and on-premise solutions. IT departments must decide whether to operate their interfaces with SAP PI/PO or SAP CPI.

If this know-how does not already exist in the company, a decision must be made whether to offer training or bring in external consultants. A comprehensive training plan for internal employees and close collaboration with experienced external partners can significantly facilitate the transition to S/4 HANA.

2. On-Premise or Cloud: Which Operating Model is Right for My Company?

One of the most crucial questions when introducing S/4 HANA is choosing the operating model: on-premise, cloud, or a hybrid solution. Each option brings its own advantages and disadvantages.

On-Premise:

Here the company retains complete control over its systems. This is especially important for companies with high requirements for data security and compliance. The disadvantage is the higher costs for hardware, maintenance and IT personnel needed to operate the system.

• Advantages: High control over data and systems, more flexibility in customization, no risk from external providers.
• Disadvantages: Higher costs for hardware and maintenance, longer implementation cycles, requires deep internal know-how.

Cloud:

Operating in the cloud offers the advantage of fast deployment and flexible scalability. However, companies must accept having less control over IT infrastructure and being heavily dependent on the service provider.

• Advantages: Fast deployment, lower maintenance costs, flexible scaling.
• Disadvantages: Less control over data, dependence on external providers, potentially complex integration requirements.

Hybrid:

A hybrid form where critical systems operate on-premise and less business-critical processes in the cloud. This solution can offer the best of both worlds, but also bring additional complexity and integration effort.

It is important that the IT department decides early which operating model best fits the company's needs to develop a long-term, sustainable IT strategy.

3. Resource Planning: Which Tasks Does the Service Provider Take On and What Should Be Done Internally?

Another central topic in planning an S/4 HANA project is the question of resources. While external service providers can offer valuable support, the company should also clearly define which tasks should be handled internally.

• Service Providers: External consultants can help with specific technical challenges, such as migrating legacy systems or implementing new technologies. They often bring specialized expertise that is not available internally.
• Internal Tasks: However, processes that directly affect the business should ideally be managed internally. The subject matter experts in the company know the workflows best and should work closely with IT to ensure systems are optimally adapted to business requirements.

It is important to define a clear division of roles and plan early which resources are needed and how collaboration between internal teams and external consultants will occur. Open communication between all involved is essential to avoid misunderstandings and successfully complete the project.

4. Early Planning: When Must I Begin Preparations?

Planning for an S/4 HANA project should begin early – ideally at least 12 to 18 months before the planned start. The complexity and impacts on all business areas make detailed preparation essential.

• Training and Know-how Building: If internal training is necessary, it must take place well before the project starts to ensure the team has the necessary knowledge at project launch.
• Technical Preparation: The IT department must conduct a comprehensive inventory of the current system landscape to understand what adjustments and modernizations are necessary.
• Business Alignment: Parallel to technical preparation, intensive discussions with business departments should be held to ensure requirements for the new system are clear.

5. Cleanup Work in the Legacy System: What Can Be Migrated to the New System?

An important part of preparing for S/4 HANA is cleaning up the existing legacy system. In most cases, companies have developed a variety of custom extensions and customizations over the years, many of which may no longer be needed.

• Code Analysis: The IT department should conduct a thorough analysis of existing code to determine which parts of the system are actually still used and which should either be archived or reworked. Here tools like the SAP Readiness Check can provide valuable support by showing which customizations are potentially critical and which can be migrated without issues.
• Decision on Redevelopment: For some customizations, it may make more sense to redevelop them from scratch in the new system to benefit from modern S/4 HANA features rather than adopting old, potentially inefficient processes.

6. System Archiving: Which Data Should Be Migrated?

In addition to code, IT should also think about data archiving. Not all data needs to be transferred to the new system.

• Data Analysis: Companies should check early which data is still relevant and which can be archived or deleted. This can improve the performance of the new system and reduce operating costs.
• Archiving Guidelines: A clear strategy for archiving old data can prevent unnecessary information from burdening the new system.

7. How Can IT Manage the Project and Not Just Be Driven by the Business Departments?

It is crucial that the IT department not only acts as an executing service provider but takes a leading role in the S/4 HANA project. The business department may specify requirements for business processes, but IT must ensure that technical and architectural decisions are made in a way that makes sense long-term and is future-proof.

• Early Alignment: Regular meetings between IT and business departments ensure that both sides understand their requirements and possibilities. A clear communication strategy and structured decision process help steer the project in the right direction.
• Technical Roadmap: IT should develop its own roadmap that ensures not only short-term requirements are met, but also long-term goals like scalability, performance and security are kept in view.

Conclusion

An SAP S/4 HANA project is a major challenge that requires both technical know-how and strategic planning. Through early preparation, clear definition of resources and tasks, and close alignment between IT and business departments, the IT department can take a leading role and successfully manage the project.

I recommend examining IT prerequisites before the project starts. Here I can help you through individual workshops or designing a complete roadmap. It is important to involve IT decision-makers up to the CIO early on to clarify strategic and financial aspects.