Update from Feb. 2020: The deadline has now been extended to 2027. Contact us for more information!
There is no denying that since SAP launched its new intelligent ERP, S/4HANA, in 2015, not enough companies acted and abandoned their old version to upgrade to that version. Even the message released by the German publisher announcing that they will stop maintenance on its predecessor ECC6 (Business Suite) in 2025 did not have the expected effect! Why?
Evil’s genesis ECC vs. HANA
Since the beginning of times, ERPs have complex architectures in order to execute, in one application, all the transactions required by a company.
In 2010, SAP launched a new revolutionary database, SAP HANA (Also read: Migrating to SAP HANA Database), allowing the storage of all in-memory data, resulting in an increase in power. Even if that is an actual revolution, it is not always seen as such by SAP customers, who think this gain in power is sometimes useless.
In 2015, SAP launched a new version of its ERP, SAP S/4HANA, rewritten to make the most of SAP HANA database and offer users a new experience. This allows making the ERP’s architecture simpler and opening up new possibilities previously considered impossible or too complex. However, that launch was premature since the initial S/4HANA versions were incomplete notably where logistics functions were concerned.
It is at that moment that SAP released the 2025 deadline, pushing their customers to convert their ECC systems. And that... was a mistake!
- Some customers cannot see an advantageous business scenario to upgrading to S/4HANA
- Some of them don’t understand the advantages to switching to S/4HANA
- Some think that SAP are just blowing hot air, and that they will back down on their announcement to stop maintenance in 2025
Migrate or wait until 2025? Ask yourself the right questions!
Waiting for 2025 is possible. But is it the right strategic decision? There are a lot of literature and blogs on the subject weighing the pros and cons (Also read: SAP S/4HANA … The Time to Prepare Is Now!).
I think that the right answer must come from the situation of the user company, not from the publisher.
So, ask yourself the right questions:
- What is my company’s growth strategy?
- What is its digital maturity level?
- How can I make my company more flexible?
- How can I make my users more effective?
- Do I want to increase collaboration with my customers and suppliers?
Those are some of the subjects SAP wished to address with S/4HANA; unfortunately, most customers only picked up on the technical part of the publisher’s message.
In other words, if you are in a growing, innovative, turned to the future company... Act before 2025, as S/4HANA will allow you to accelerate your strategy!
If not, wait until 2025, but not too much as the closest you get to the deadline, shortages of qualified resources will most likely be increasingly frequent.
What are the benefits to migrate to SAP S/4HANA before 2025?
We are, as of now, in the digital and intelligent business era. SAP S/4HANA is targeting businesses that are committed to their digital shift, innovation and growth (Also read: Why SAP S/4HANA?).
Everyone is talking about the digital shift, but... As per a study led by the BDC, only 19% of all Canadian SMEs show an advanced digital profile!
Shocking, isn’t it? Especially since the current growth rate and profitability of a company are directly related to its digital maturity (same BDC study).
The new SAP S/4HANA version released by the German publisher must be considered as a means to make the digital shift, to hop on the bandwagon of the Industry 4.0 and gain a serious competitive edge over the competition. You will thus be able to take advantage of real-time analytics, forecasting, Internet of Things, artificial intelligence, automation of certain tasks, etc.
It’s a matter of survival for Canadian SMEs; some of which are already too far behind.
Recent innovations and SAP S/4HANA openness could allow our businesses to quickly catch up on their backlog and compete successfully:
- By improving the user’s effectiveness;
- By making possible real-time, enlightened decision-making;
- By improving planning and forecasting;
- By automatizing some low value-add tasks;
- By using forecast functionalities rather than looking in a mirror;
- By improving internal collaboration, but also collaboration with customers and suppliers.
The two issues you are facing: how do I do it and how much does it cost?
Here we are... How much does it cost and how do I go from ECC6 to S/4HANA?Let’s be clear: migrating to S/4HANA has a cost, and requires getting prepared. Just like a trip!(Also read: Traps to Avoid When Converting to S/4HANA).
An event, significant for your business, can become the trigger that will allow you to financially justify your project: an acquisition, openness to the international market, going public, the launch of a new product, the opening of a new plant, etc. But in most cases, you will have to build a business scenario and find your way.
Building this business scenario, will require you to achieve an analysis similar to a SWOT (Strengths Weaknesses Opportunities Threats) and identify your current strengths and weaknesses. This will also require you to put into perspective improvement opportunities that are not being exploited but from which the company would greatly benefit. And risks, that, if not addressed, are threatening to considerably affect your business.
This exercise, will help you define the best way and the best steps applying to this transformation. When talking about migrating to S/4HANA, several businesses that have been using SAP for several years, thus having gone through several customization, might find themselves facing difficult choices:
- Retain the passive and migrate it;
- Go back to the “standard”, and perhaps even think about reimplementation, using best practices.
The SAP approach to answer those questions
Fortunately, SAP, now facing a backlog in their customer’s conversion to S/4HANA, implemented with major partners such as Createch, a few tools and a 3-step approach. You can find this approach under two different names:
In fact, we are talking about similar approaches. These approaches allow addressing the business and technical aspects of a conversion, thus answering the most important questions a company might have. Why? What? How? Answers to which will determine your business scenario, thus your “way”.
3 SAP tools that will get you ready for 2025
This support program approach is articulated around structuring tools that will allow you to organize your reflection while supplying you with clear information.
1. SAP Readiness Check
SAP Readiness Check will analyze the technical configuration of your existing SAP system and identify the actions that need to be executed to properly convert your ECC6 to S/4HANA. The questions to which it will supply answers to, are:
- What size HANA database should I plan for?
- Are my extensions compatible with SAP S/4HANA?
- What are the possible effects on my current transactions?
- Is my specific code transposable to S/4HANA?
2. SAP Business Scenario Recommendations (next generation)
Whereas SAP Business Scenario Recommendations (BSR) analyzes the use of your current system and transposes it into S4/HANA by identifying areas of improvement from which you would benefit. It even has market research functions.
3. SAP Transformation Navigator
Lastly, SAP Transformation Navigator allows you to provide business goals, prioritize them at different levels, and to identify the components within the SAP solutions portfolio that will allow reaching those goals. Putting this in perspective to your current SAP system.
All those tools are self-serve! But tools only are not enough. They provide access to information that then needs to be organized ad used to build a business scenario and assessment of required efforts. This is where the approach is crucial and where we can guide you.
Last piece of advice: don’t wait!
Better act now than suffer the consequences! Even if a conversion is currently unrealistic when taking into account your agenda or constraints, YOU SHOULD PREPARE NOW!
First, launch the assessment of this new version. Or contact Createch directly and together, we will examine the different possibilities to get you ready for it, through the SAP S/4HANA Adoption Starter Program. Because Createch is the leader in S/4HANA conversions in Quebec!
Read further blog articles and Createch customers’ testimonies about SAP S/4HANA: