S/4HANA

TRANSFORMATION
HOW TO PREPARE FOR
A SUCCESSFUL S/4HANA
TRANSFORMATION
In today's fast-paced digital economy, businesses are increasingly seeking
to innovate and enhance operational efficiency to stay ahead. At the
heart of these transformation efforts is the modernisation of enterprise
resource planning (ERP) systems. SAP S/4HANA, with its advanced in-
memory computing, represents a significant evolution from traditional ERP
solutions, offering improved speed, efficiency, and analytical insights.

Transitioning to S/4HANA is a considerable endeavour that necessitates

meticulous planning and execution. It involves navigating technical
prerequisites, adjusting business processes, and managing change. This
document aims to provide businesses with a comprehensive guide
through the crucial stages of preparing for an S/4HANA transformation.
From assessing your current SAP landscape to data migration and beyond,
we aim to furnish organisations with the insights needed to ensure a
successful transition.

Our goal is to equip businesses with the knowledge and tools necessary for
a smooth migration to S/4HANA, enabling them to harness the full potential
of their digital core for future growth and competitiveness.
Understanding Your Current SAP Landscape
Before embarking on an S/4HANA transformation, a thorough understanding
of your existing SAP landscape is essential. This understanding forms the basis
for planning the migration and ensures that the transition accommodates all
critical aspects of your current operations.

Inventory of Current SAP ERP Systems

Begin with an inventory of your current SAP systems,
including versions, modules, and customisations. This
inventory will highlight the components that are critical
for business operations and those that may require
updates or replacements.

Customisations and Integrations

Evaluate the extent of customisations and integrations
within your current SAP system. S/4HANA offers a simplified
data model and enhanced functionalities that might
replace some customisations. However, understanding
these elements is crucial for a smooth transition and for
planning necessary adaptations.

Data Volume and Quality

Assess the volume and quality of the data housed in your
current system. Data cleansing and archiving irrelevant
data can significantly reduce migration times and
improve system performance in S/4HANA. This step is vital
for a successful migration strategy, ensuring that only
relevant, high-quality data is transferred to the new
system.

Identifying Potential Challenges

Identify potential challenges and areas of concern early
in the planning stage. These might include technical
debt, data inconsistencies, or gaps in user training.
Addressing these issues early can mitigate risks and
ensure a smoother transition process.
Building a Business Case for S/4HANA
The decision to migrate to S/4HANA should be underpinned by a robust
business case that outlines the strategic, operational, and financial benefits of
the transformation. This section guides you through the key elements to
consider when building your business case.

Identifying Business Benefits

Highlight the potential benefits of migrating to S/4HANA,
such as enhanced efficiency, improved decision-
making capabilities through real-time analytics, and the
ability to innovate business processes. Focus on how
these benefits align with your organisation's strategic
goals.

Cost-Benefit Analysis
Conduct a thorough cost-benefit analysis to evaluate
the investment required for the S/4HANA migration
against the expected returns. This analysis should
include direct costs (such as software, hardware, and
implementation services) and indirect costs (like training
and change management), as well as a projection of
the financial benefits (efficiency gains, process
improvements, etc.).
Stakeholder Engagement
Engage with stakeholders across the organisation to
gather input and build support for the S/4HANA migration.
This includes understanding the needs and concerns of
different departments, discussing potential impacts, and
highlighting the strategic value of S/4HANA to the
organisation's future.

Risk Management and Mitigation Strategies

Identify potential risks associated with the S/4HANA
migration and outline strategies to mitigate these risks. This
may involve phased migration plans, thorough testing
strategies, and contingency planning to ensure business
continuity.

Timeline and Milestones

Establish a realistic timeline for the migration, including
key milestones and deliverables. This timeline should
consider the complexity of your current SAP landscape,
the scope of the migration, and the need for parallel
running or phased rollouts.
Planning Your S/4HANA Transformation
A successful S/4HANA transformation requires meticulous planning. This section
provides a framework for organising your migration project, including
selecting the migration approach, defining the project scope, and allocating
necessary resources.

Choosing the Right Migration Path

There are three primary migration paths to S/4HANA:
Greenfield Approach: Starting anew by implementing a fresh system that
enables reimagining business processes and adopting standard practices
with minimal customisation.
Brownfield Approach: Migrating existing ERP systems and processes to
S/4HANA, retaining much of the current system's data and customisations.
Hybrid Approach: Combining elements of both Greenfield and Brownfield,
this approach allows for selective data migration and process redesign.
The choice depends on your organisation's strategic goals, the complexity of
the existing landscape, and the desire for innovation versus preservation of
current processes.

Project Planning and Milestones

Develop a detailed project plan that outlines each phase of the migration,
including:
Pre-migration assessments
Technical preparations
Data migration and validation
Custom code adaptation
Training and change management activities
Testing phases
Go-live and post-go-live support
Identify key milestones and deliverables for each phase to track progress and
ensure alignment with the overall timeline.
Resource Allocation
Determine the budget, personnel, and tools required for a successful
migration. This includes:
Budget: Estimating costs associated with software, hardware, consultancy,
training, and potential downtime.
Personnel: Assigning a dedicated project team, including internal staff and
external consultants, with clear roles and responsibilities.
Tools and Technologies: Selecting the right tools for data migration, custom
code analysis, testing, and project management.
Stakeholder Communication and Engagement
Establish a communication plan to keep stakeholders informed throughout the
migration process. Regular updates, workshops, and feedback sessions can
help manage expectations, address concerns, and ensure continued support
for the project.

Technical Considerations and Requirements

Migrating to S/4HANA is not just a business transformation but also a significant
technical undertaking. This section outlines the key technical considerations
and requirements necessary for preparing your landscape for S/4HANA.

Hardware and Infrastructure Requirements

S/4HANA's in-memory computing requires specific
hardware and infrastructure configurations. Assess your
current hardware to determine if upgrades or
replacements are necessary to meet the performance
requirements of S/4HANA. This includes server capacity,
memory, network bandwidth, and storage.

S/4HANA Architecture Overview

Understanding the architecture of S/4HANA is essential for
planning your migration. S/4HANA offers a simplified data
model and a Fiori-based user interface, among other
technical advancements. Familiarise yourself with these
aspects to ensure your team can effectively manage the
new system.
Compatibility Checks and Prerequisite Tasks
Perform compatibility checks to ensure your existing SAP ERP
system and any connected applications or custom
developments are compatible with S/4HANA. SAP provides tools
such as the Readiness Check and Simplification Item Check to
help identify potential issues and prerequisites for migration.

Data Management Strategy

Develop a data management strategy that includes data
cleaning, archiving, and governance. Ensuring data quality
and consistency before migration can significantly reduce
complexities and improve the performance of the new system.

Custom Code Adaptation

Assess and adapt your custom code for compatibility with
S/4HANA. The Custom Code Migration App, provided by SAP,
can help identify and remediate code that may not be
compatible with the new environment. Prioritising essential
customisations for adaptation reduces migration risks and
effort.

Testing and Validation

Plan for comprehensive testing of the S/4HANA system,
including functional, performance, and integration testing.
Testing should validate that all business processes function as
expected and that performance meets or exceeds
requirements.