It is estimated that a transition to S/4HANA is imminent for around 50,000 SAP installations worldwide. Whether a company is introducing completely new processes or adapting existing ones – it is vital that such a business-critical transformation is designed as minimally invasively as possible, with the use of powerful specialized software. Otherwise, there is a risk of severe business impact with losses in the millions.
A typical scenario within the industry: A German company in the manufacturing industry would like to implement S/4HANA as a greenfield project. The application template is almost ready. Everything is good to go, ready for the first rollout project. The entire program, including the timeline, is fixed. The six SAP systems are to be replaced successively in more than 20 individual projects. Around 30 international subsidiaries are affected. The changeover must be swift and, most importantly, smooth. Ideally, the changeover to the new ERP system should go unnoticed by customers and partners. That is important. Because the order books are full. The renowned company is also part of a higher-level supply chain.
The critical question is: How do you get the data from the source systems into the new target landscape? According to the IT department, migration is the answer – a classic and tedious for the offshore colleagues. But then top management gets involved: Are we on the right track, have we planned our transformation to S/4 in sufficient detail? What are the real risks to our business from this historic cutover?
Inconsistencies following a classic migration
For many companies, the final few months before the transformation are usually tough. There can only be very few open items at the time of changeover. Many supplier invoices are therefore paid much earlier than strictly necessary, well before the payment deadline. For a certain period, transactions have to be duplicated. Should new projects still be created in the old system? Only if absolutely necessary. This all creates costs and impacts business performance. When using classic migration tools, open orders and deliveries have to be cancelled, open items booked out - a massive impact on business. Later, all of these activities have to be redone in the new system to proceed with the transactions. It often takes months for the inconsistencies in the new system to be resolved and the many small friction losses to disappear.
Worst-case scenario: a pause on international shipments
With a classic migration, you have to be prepared. There is a high likelihood of a temporary decline in productivity or even a standstill in some areas. To allow for sufficient time to check critical processes and correct any issues, a 70 percent reduction in shipments for a couple of days is not unusual. In the worst-case scenario, you can be looking at not being able to deliver goods over a number of days. A customer from the top 500 recently calculated that this standstill can quickly mean lost revenue in excess of several million euros! The question is: What does this mean for the company as a whole and the entire supply chain? No global company can afford such a worst-case scenario.
A minimally invasive transition to S/4 with maximum process continuity should therefore be the goal: With the right migration approach, a strategy tailored to business processes, and the special cbs ET Enterprise Transformer software, a transition to the new ERP platform can be realized with near-zero downtime. Documents are transferred in any status. The users log out of the SAP ECC system on a Friday. When they return on Monday and log in to the new S/4 system, they can continue working on their open orders, deliveries, invoices, or projects exactly where they left off in the legacy system. If everything works smoothly after the go-live, the project manager and CIO breathe a sigh of relief. After all, business continuity is a key issue for big corporations. It is important to keep product output high and avoid serious damage or devastating losses due to sustained operational disruptions during migration for instance.
Core business processes are the main focus here, and of vital importance for the achievement of the corporate goals. Failure can jeopardize a business’s continued existence in the global market.
Which tools are best for SAP S/4HANA?
cbs ET is the key to a successful accelerated SAP S/4HANA transition. Having been continually developed over the years, the software reduces the above risks to an absolute minimum. The cbs standard software in use today is based on experience gained from more than 2,000 international transformation projects – in Europe, the US, South America, India, China, and Singapore.
There are, of course, other tools for data migration; but few are S/4HANA ready in any way, shape, or form. SAP has retired its well-established LSMW migration and introduced the S/4HANA Migration Cockpit as the successor. This tool still lacks maturity however, especially in the migration of large amounts of data. Another alternative is SAP Data Services with Rapid Deployment Solutions – an acquired tool offering traditional ETL (extract, transform, load) functionalities. However, all of these approaches share the same disadvantage: slow data processing using transactional methods (BAPI or IDoc). The transfer of transactional data in any process state is not possible with these tools!
So what data should be transferred from the legacy systems? How much history is needed to continue working seamlessly in the new system? In most cases, the smarter course of action is to not simply bring all of your data with you. Because systems that have grown over the years often contain organizational units that have become obsolete. With ET, therefore, the transformation scope is flexible and tailored to the customer: The entire history can be transferred or only from a certain period (e.g. the last 3 years), or you can limit the data on specific organizational units or selected business processes. In contrast to the tools mentioned above, the cbs ET with its direct update technology masters the transfer of transactional data in every process status.
The excellent process continuity and greatly reduced friction during the transition make it possible to realize ambitious big-bang go-lives for large corporations with many national companies, as demonstrated by the selective transformation approach of the Viessmann Group. Timelines and roadmaps for the S/4 transition can therefore be greatly reduced and streamlined; effectiveness and speed that ultimately offer the companies a competitive advantage.