Eight guidelines for migrating to SAP S4/Hana

2 June 2022

Companies facing the transition to an SAP S4/Hana environment are flooded with commercial material and the theoretical benefits the migration will bring. As the input in this process very often comes from the broad SAP community; it's hard for users to detect potential pitfalls, and to distinguish marketing from real benefits.

Challenging system integrators

Being independent from software vendors, the TriFinance BCB Management Information & Systems (MI&S) is well placed to bring all the needed elements together in an objective way. On May 17, MI&S organized a round-table discussion on migration to S4/Hana for companies running on SAP R/3 and planning migration to S4/Hana.

'We support organizations that are implementing financial systems,” BCB leader Serge Vigoureux says. 'We partner with them to challenge system integrators to get the most added value out of an implementation. Plus: we are actually involved in a lot of discussions lacking the real business case to move to S4/Hana.'

On-premise implementation is still the main deployment mode

Implementations that focus only on a new tool are a waste of effort that you should avoid in today's rapidly changing market conditions. Surveys show that only 25 percent of companies are already live in S4 Hana, 20 percent are currently implementing and 35 percent are planning to move. For all the projects running, the main deployment mode is still an on-premise implementation.

Although a lot of work remains to be done, there is a scarcity of well-trained consultants. Because the added value of migrations is not clear enough, most of the projects are purely seen as technical migrations with the result that projects are postponed until the last minute.

Only 25 percent of companies are already live in S4 Hana, 20 percent are currently implementing and 35 percent are planning to move. For all the projects running, the main deployment mode is still an on-premise implementation.

Serge Vigoureux, BCB Leader Management Information & Systems

Will the cloud eliminate all technical problems?

An important decision has to be made about the hardware on which a new SAP environment should run. Despite the belief that "the cloud will eliminate all technical problems," many details must be taken into account before choosing the right cloud configuration. Many configurations are possible, both from a technical and functional perspective (not all functionalities are available in the public cloud), but they all have a major impact on budget and timing.

C-level participants at the TriFinance round-table mainly had seen theoretical slides about the new application, as if it were a small-scale project that no one should have to deal with. ‘In our own S4 sandbox environment,’ Serge Vigoureux says, ‘we demonstrated the new interface. We showed the Fiori apps that will become the standard and suggested participants to get better acquainted with the apps because users will be overwhelmed by the sheer number of apps, a lot of which may not cover the functionality they need in their organization.

Advantages & novelties

TriFinance experts also explained the advantages of universal journals and of the material ledger that will allow actual costing. They discussed the move from cost-based to account-based COPA and also illustrated the setup of predictive accounting. All of these new features should be well prepared in the beginning of the project to enlarge the business case and to get sufficient involvement and support from leadership for a successful implementation.

Only important novelties were discussed during the round table, and mainly those affecting the finance community. Many other features are about to change that organizations should know before starting a migration. The main conclusion is that companies should prepare well.

Eight guidelines

Based on our experience we formulated eight guidelines one should take into account when undertaking a S/4Hana transformation project :

  1. Establish a solid core team covering all the key roles necessary from the beginning to the end of the project
  2. Establish the new system as a clean digital core where extensions are only allowed under specific circumstances
  3. For the project to be succesful, Involved leadership proves to be more effective
  4. It is critical that a strong blueprint is made with a complete manual of each relevant process on a high level
  5. Be prepared for continuous transformation. Contribute to increase adoption and effectiveness
  6. The rollout of the new system should contribute to value-driven company goals
  7. Benefits of future updates should guarantee optimal and correct use of the system
  8. Avoid the development of unnecessary functionalities in the software.