The Ultimate Guide to S/4HANA Migration

What this guide covers: The S/4HANA experts behind Maextro have compiled the complete business guide to S/4HANA. This guide covers what it is, how it works, where to start, migration and much more.

What is S/4HANA?

S/4HANA is SAP’s fourth-generation ERP software suite designed to run on the in-memory database SAP HANA. It offers real-time data processing, a simplified data model, and an intuitive user interface (SAP Fiori). S/4HANA leverages advanced technologies like AI, ML, and IoT, integrating industry-specific solutions. It comes in various deployment options, including on-premises, cloud, and hybrid models, catering to different business needs. S/4HANA represents a significant advancement over previous SAP ERP systems, enabling organisations to streamline processes, enhance performance, and gain actionable insights for improved decision-making and innovation.

What is S/4HANA Migration?

S/4HANA migration refers to the process of transitioning an organisation’s existing ERP system to SAP S/4HANA, the next-generation ERP software suite built on the SAP HANA database. This migration involves moving data, configurations, and business processes from the current ERP system (e.g., SAP ERP ECC or non-SAP systems) to S/4HANA.

The migration process can vary depending on the starting point and the chosen S/4HANA deployment option (on-premises, cloud, or hybrid). It typically includes activities like data cleansing and preparation, code adaptation, business process re-engineering, and customising functionalities to fit the S/4HANA environment.

A successful S/4HANA migration can offer organisations benefits such as real-time data analytics, simplified data models, improved user experiences, and access to advanced technologies, fostering digital transformation and enhancing operational efficiency. However, S/4HANA migration can be a complex and strategic endeavour, often requiring careful planning, testing, and collaboration between business and IT stakeholders to ensure a smooth and successful transition.

Why Migrate to S/4HANA?

Organisations choose to migrate to S/4HANA for several compelling reasons, as it offers a range of benefits and opportunities for business transformation. Here are some key reasons why companies consider migrating to S/4HANA:

• Real-time Insights: S/4HANA’s in-memory computing enables real-time data processing and analytics, providing instant access to critical business information. This allows organisations to make faster, data-driven decisions and respond promptly to market changes.
• Simplified Data Model: S/4HANA’s simplified data model eliminates redundancies and aggregates, reducing data footprints and improving system performance. This results in faster transaction processing and reporting capabilities.
• Enhanced User Experience: S/4HANA’s modern and intuitive user interface, SAP Fiori, enhances the user experience, making it easier for employees to navigate and perform tasks efficiently.
• Integration of Emerging Technologies: S/4HANA integrates with advanced technologies like AI, ML, IoT, and advanced analytics. This enables businesses to leverage these technologies to automate processes, gain insights, and drive innovation.
• Industry-Specific Solutions: S/4HANA offers pre-configured industry-specific solutions, known as “SAP Best Practices,” which can accelerate the implementation process and cater to specific business needs.
• Cloud-Readiness: S/4HANA is designed to run on the cloud, allowing organisations to take advantage of cloud benefits like scalability, flexibility, and reduced infrastructure costs.
• Long-term SAP Strategy: As SAP’s strategic ERP platform, S/4HANA is receiving continuous updates and support, while older SAP ERP systems like ECC are transitioning toward the end of their support lifecycle.
• Compliance and Regulatory Requirements: S/4HANA offers improved functionalities and reporting capabilities that help businesses meet evolving compliance and regulatory requirements.
• Simplified Landscape: Migrating to S/4HANA provides an opportunity for organisations to reevaluate and optimise their business processes and IT landscape, leading to streamlined operations and reduced complexity.
• Competitive Advantage: By embracing S/4HANA’s capabilities, organisations can gain a competitive edge in the market by being more agile, efficient, and data-centric.

While the decision to migrate to S/4HANA involves careful planning and investment, the potential benefits it offers for business innovation, efficiency, and long-term sustainability make it an attractive proposition for many companies seeking to embrace digital transformation and stay ahead in the rapidly evolving business landscape.

Key features of S/4HANA?

SAP S/4HANA is a comprehensive ERP software suite with numerous features that cater to the evolving needs of modern businesses. Here are some key features of S/4HANA:

• In-Memory Computing: S/4HANA is built on the SAP HANA in-memory database, enabling real-time data processing and analytics for faster insights and decision-making.
• Simplified Data Model: S/4HANA adopts a simplified data structure, eliminating indices and aggregates, which results in faster data access and reduced data footprint.
• SAP Fiori User Interface: S/4HANA offers a modern and intuitive user interface known as SAP Fiori, providing a consistent and user-friendly experience across devices.
• Industry-Specific Solutions: S/4HANA provides pre-configured industry solutions, known as “SAP Best Practices,” to streamline implementations and address specific business requirements.
• Integration with Advanced Technologies: S/4HANA integrates with artificial intelligence (AI), machine learning (ML), Internet of Things (IoT), and advanced analytics, enabling businesses to leverage these technologies for automation and insights.
• Cloud-Readiness: S/4HANA is designed to run on the cloud, allowing organisations to deploy it in various cloud environments for increased scalability and flexibility.
• Centralised Finance: S/4HANA Finance (formerly known as SAP Simple Finance) provides a unified view of financial data in real-time, enabling better financial planning and analysis.
• Integrated Procurement and Supply Chain: S/4HANA integrates procurement and supply chain processes, enabling end-to-end visibility and optimisation of the supply chain.
• Enhanced Sales and Customer Management: S/4HANA enhances customer engagement by providing real-time sales insights and advanced customer relationship management (CRM) capabilities.
• Predictive Analytics: S/4HANA leverages embedded predictive analytics, enabling businesses to anticipate outcomes, identify trends, and optimise decision-making.
• Migration Cockpit: S/4HANA offers migration tools and a migration cockpit to help organisations efficiently transfer data from legacy systems to the new platform.
• Extensibility: S/4HANA allows for the creation of custom applications and extensions to adapt the system to unique business requirements.
• SAP Activate Methodology: SAP Activate is a methodology that supports the implementation and adoption of S/4HANA, offering best practices, templates, and tools for project management.

These are just some of the key features of SAP S/4HANA. The platform continues to evolve with regular updates and enhancements from SAP to meet the changing needs of businesses in the digital age.

What are the benefits of S/4HANA Migration?

Migrating to SAP S/4HANA can provide several significant benefits to organisations, fostering business transformation and efficiency. Here are some of the key advantages of S/4HANA migration:

• Real-time Insights: S/4HANA’s in-memory computing allows for real-time data processing and analytics, enabling instant access to critical business information and supporting faster decision-making.
• Improved Performance: The simplified data model and elimination of indices and aggregates in S/4HANA lead to faster transaction processing and reporting, improving overall system performance.
• Enhanced User Experience: S/4HANA’s modern and intuitive user interface (SAP Fiori) enhances user experience, making it easier for employees to navigate and perform tasks efficiently.
• Advanced Analytics and AI: S/4HANA integrates with advanced technologies like AI and ML, enabling predictive analytics, automation, and better insights into business operations.
• Industry-Specific Solutions: S/4HANA offers pre-configured industry solutions (SAP Best Practices), accelerating the implementation process and catering to specific business needs.
• Simplified Landscape: Migrating to S/4HANA provides an opportunity to streamline and optimise business processes and IT landscape, reducing complexity and improving operational efficiency.
• Cloud-Readiness: S/4HANA is designed to run on the cloud, allowing organisations to take advantage of cloud benefits like scalability, flexibility, and reduced infrastructure costs.
• Integrated Business Functions: S/4HANA integrates various business functions, such as finance, procurement, supply chain, sales, and customer management, enabling end-to-end visibility and collaboration.
• Compliance and Reporting: S/4HANA offers improved reporting and analytics capabilities, aiding compliance with regulatory requirements and enhancing financial transparency.
• Digital Transformation: By leveraging S/4HANA’s capabilities, organisations can embark on a digital transformation journey, embracing innovative technologies and business models.
• Long-term SAP Strategy: S/4HANA is SAP’s strategic ERP platform, ensuring continuous support and updates, while older SAP ERP systems like ECC are reaching the end of their support lifecycle.
• Competitive Advantage: S/4HANA empowers organisations to become more agile, data-driven, and customer-focused, giving them a competitive edge in their respective markets.

While S/4HANA migration requires careful planning, investment, and collaboration between business and IT teams, the benefits it offers for business innovation, efficiency, and future readiness make it a compelling choice for organisations seeking to stay ahead in the rapidly evolving digital landscape.

What are the Challenges of S/4HANA Migration?

This is a notorious question as many companies are hesitant to make the move. S/4HANA migration can present several challenges that organisations need to address to ensure a successful and smooth transition. Some of the key challenges include:

• The complexity of Migration: Migrating from legacy systems, especially if heavily customised, can be complex and time-consuming. Organisations may face data mapping, data cleansing, and data transformation challenges.
• Custom Code Adaptation: Custom code and modifications made in the existing ERP system may not be directly compatible with S/4HANA. Adapting custom code to work with the new platform can be a significant task.
• Business Process Re-engineering: S/4HANA offers new functionalities and processes, requiring organisations to re-evaluate and redesign their existing business processes to leverage the full potential of the platform.
• Data Volume and Migration Time: The volume of data to be migrated and the time required for data transfer can be substantial, potentially leading to longer downtime during the migration process.
• Skill and Resource Gap: S/4HANA migration demands expertise in both SAP technology and business processes. Organisations may face challenges in finding skilled resources and training their staff for the migration.
• Testing and Validation: Rigorous testing is essential to ensure that the migrated system works correctly and meets business requirements. Testing can be time-consuming and resource-intensive.
• Integration with Third-party Systems: Integrating S/4HANA with other third-party systems can be complex, requiring thorough testing and coordination with multiple vendors.
• Data Security and Compliance: Ensuring data security and compliance during migration is crucial, especially when dealing with sensitive data. Organisations must follow data protection regulations.
• Cost and Budget Constraints: S/4HANA migration involves various costs, including licensing, hardware, consulting services, and training. Budget constraints may pose challenges for some organisations.
• Business Disruption: Migrating to a new ERP system can cause temporary business disruption, impacting operations and user productivity during the transition phase.
• Change Management: User acceptance and change management are crucial to ensure that employees are prepared for the new system and its features.

To overcome these challenges, careful planning, engaging experienced partners or consultants, conducting thorough testing, and involving key stakeholders throughout the migration process are essential. Organisations should also consider adopting a phased approach to migration, focusing on critical functionalities first and then expanding to other areas gradually.

What are the use cases for S/4HANA Migration?

SAP S/4HANA offers a wide range of use cases across various industries and business functions. Here are some specific use cases for S/4HANA:

• Real-Time Analytics and Insights: S/4HANA’s in-memory computing allows organisations to access real-time analytics and insights, enabling faster and more informed decision-making across all business functions.
• Finance Transformation: S/4HANA Finance centralises financial data, providing a unified and real-time view of financial information, leading to better financial planning, analysis, and compliance.
• Supply Chain Optimisation: S/4HANA’s integrated supply chain management capabilities offer end-to-end visibility and optimisation opportunities, helping organisations streamline inventory management, reduce lead times, and improve overall supply chain efficiency.
• Customer Engagement and Sales Effectiveness: S/4HANA’s advanced CRM functionalities enable businesses to enhance customer engagement, sales processes, and customer satisfaction, leading to improved customer relationships and increased sales performance.
• Business Process Simplification: S/4HANA’s simplified data model and streamlined processes help organisations simplify and standardise their business processes, reducing complexity and improving operational efficiency.

These are just a few examples of the many use cases for SAP S/4HANA. As a comprehensive ERP solution, S/4HANA caters to various industries and business functions, enabling organisations to optimise operations, make data-driven decisions, and achieve their specific business objectives.

Who are the key participants in S/4HANA Migration?

The five key participants in an S/4HANA migration project are:

• Business Sponsor or Executive Sponsor: The business sponsor or executive sponsor is a senior-level leader (e.g., CEO, CFO, CIO) who provides the overall vision, strategic direction, and support for the S/4HANA migration. They champion the project within the organisation and ensure that it aligns with the business goals and objectives.
• Project Manager: The project manager is responsible for overseeing the entire migration project. They lead the planning, coordination, and execution of the project, ensuring that it stays on schedule, within budget, and meets its objectives.
• SAP Implementation Team: The SAP implementation team consists of SAP experts, consultants, and technical specialists who possess the necessary knowledge and skills to migrate to S/4HANA. They handle the technical aspects of the migration, including data migration, system configuration, and customisations.
• Business Process Owners: Business process owners are subject matter experts representing different business functions or departments. They work closely with the implementation team to ensure that S/4HANA aligns with the organisation’s business processes and requirements.
• IT Team: The IT team plays a crucial role in the migration, working alongside the implementation team to provide technical infrastructure, manage system integration, and address any IT-related challenges during the migration process.

These key participants collaborate throughout the migration project to ensure a successful transition to S/4HANA. Their roles are integral to the project’s success, encompassing strategic direction, project management, technical expertise, business process knowledge, and IT support. Effective communication and coordination among these stakeholders are vital for a smooth and efficient S/4HANA migration.

What’s the difference between SAP ECC & SAP S/4HANA

SAP ECC is built on traditional databases, with batch-based analytics, while SAP S/4HANA runs on the in-memory database SAP HANA, enabling real-time analytics and a simplified data model. S/4HANA has a modern user interface (SAP Fiori), better integration with advanced technologies, and offers various deployment options, making it a more advanced and agile ERP platform compared to ECC.

The latest trends in S/4HANA Migration

New developments for S/4HANA can bode new ways to make migration simpler. Here are a few we think could lead to that:

• Cloud Migration: Many organisations were opting for cloud-based S/4HANA deployments to leverage the benefits of cloud computing, including scalability, flexibility, and reduced infrastructure costs.
• Selective Data Migration: To simplify the migration process, some companies were adopting a selective data migration approach, moving only relevant and essential data to S/4HANA rather than migrating all historical data. This can be achieved with tools like Ditto
• Fiori Adoption: The adoption of SAP Fiori, the modern user interface for S/4HANA, was gaining momentum, as businesses sought to improve user experiences and drive user engagement.
• Machine Learning and AI Integration: More companies were exploring the integration of machine learning and AI technologies in S/4HANA to automate processes, enhance predictive analytics, and improve decision-making.
• Simplification of Custom Code: Organisations were focusing on simplifying custom code and minimising modifications during migration to ensure compatibility with S/4HANA’s data model.
• S/4HANA Cloud Adoption: Companies were increasingly looking into S/4HANA Cloud as an attractive option for faster deployment and reduced infrastructure management responsibilities.
• Integration with IoT: Integration of Internet of Things (IoT) data into S/4HANA was becoming popular, providing real-time insights and predictive maintenance capabilities.

How to choose the right partner for S/4HANA Migration?

Choosing the right S/4HANA migration partner is critical to ensuring a successful and smooth migration. Here are essential factors to consider when selecting the right partner:

• Expertise and Experience: Look for a partner with a proven track record of successful S/4HANA migrations. Verify their experience, certifications, and expertise in SAP technologies.
• Industry Knowledge: Choose a partner with experience in your industry. They should understand your specific business processes and requirements, making the migration more tailored to your needs.
• References and Case Studies: Request references and case studies from the partner to learn about their previous migration projects and client satisfaction.
• Skills and Resources: Ensure the partner has a skilled team with the necessary technical and functional expertise to handle all aspects of the migration, including data migration, configuration, and customisations.
• Innovation and Integration Capabilities: Verify if the partner has experience integrating SAP S/4HANA with other systems, such as CRM or third-party applications, to ensure seamless interoperability.
• Change Management Support: Choose a partner that offers change management support to help your organisation adapt to the new system and maximise user adoption.
• Project Management Approach: Assess the partner’s project management methodology and communication practices. A clear and transparent approach is essential for successful collaboration.
• Support and Maintenance: Inquire about post-migration support and ongoing maintenance services that the partner can offer to ensure continuous system performance.
• Global Reach and Support: If your organisation operates globally, consider a partner with a global reach and support network to cater to different locations and time zones.
• Client Engagement Model: Discuss the partner’s client engagement model and how they plan to involve your team in the migration process.
• Cost and Budget: Obtain detailed cost estimates and evaluate them against your budget constraints. Be wary of unusually low or high cost proposals and ensure you understand the pricing structure.
• Partnerships with SAP: Check if the partner is an authorised SAP partner or has relevant SAP certifications, which can indicate their credibility and access to SAP resources.
• Innovation and Future Readiness: Assess the partner’s approach to innovation, technology trends, and their commitment to staying updated with the latest advancements in SAP technologies.
• Cultural Fit: Ensure the partner’s culture aligns with your organisation’s values and work ethics for a smooth and productive collaboration.

By carefully evaluating these factors and conducting due diligence, you can choose the right S/4HANA migration partner who can guide you through a successful migration and support your organisation’s digital transformation journey.

Getting started with S/4HANA Migration solutions from Maextro

Want to leverage your data landscape for digital innovation? Begin your S/4HANA migration with Maextro. Reach out to the Maextro team and discuss your requirements today. Our team of S/4HANA experts will guide you through solution customisation, tailoring it to fit your unique business processes and data model. Maextro‘s low-code, UI5 solutions will streamline your data migration, ditching the tedious for enhanced decision-making and operational efficiency.