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Earlier this year, SAP announced S/4HANA, which clarifies SAP's future strategy around its main Business Suite software offering. Business Suite is SAP's behemoth product that encompasses ERP, CRM, human capital management (HCM), warehouse management, supplier management and more. But what is S/4HANA and what does it mean for potential users?
It's important to come at this question from the perspective of a company currently using SAP that is trying to plan its future business software strategy. From this perspective, S/4HANA is the announcement of SAP's commitment to a fundamental refresh and rethinking of its core Business Suite software. This refresh focuses on three main areas and each has significance for users.
The 'S' promises simple
Simplification is the watchword of S/4HANA. Simplification won't come all at once. As components of the Business Suite are refreshed, SAP plans to simplify both the technical architecture and the user experience of these products. The first such refresh, Simple Finance, is already on the market and we can look to it as an example.
S/4HANA's simplification means the database schema for an application reduces down to a fraction of the number of tables that existed in the traditional Business Suite. It also means a movement of application logic from the ABAP application server to either the database or to the client. Although this migration of application logic isn't inherently simplifying, in the past, SAP tended to implement all logic on the application server while treating the database and client as simply a data store and a screen, respectively. Moving application logic to its natural home often allows for simplification, because each layer can play to its strengths.
Simplified user experience means both unifying the myriad user interfaces in SAP's products as well as building user-facing interfaces and processes with an eye toward efficiency and ease of use. This means making the interfaces look decent -- something SAP has always struggled with -- as well as paying attention to details such as providing good default values and reducing the number of clicks required in a process.
Fourth-generation suite means modification roadblocks
S/4HANA, in addition to being a simplification of the Business Suite software, is the next generation of that same software. This means some major changes, and current SAP users often won't be able to upgrade without significant project work and a new license.
The biggest change for many existing users of SAP ERP software who are looking at S/4HANA will be that the new product pushes back hard on what has become an uncomfortably common practice of significantly modifying the core SAP software. S/4HANA is cloud-focused but will come in three versions, ranging from a "true cloud" version (called "public cloud"), to a managed hosted version (SAP calls this "private cloud") and the traditional on-premises version. There are two problems with traditional modifications in S/4HANA:
- Because of the technical and user-experience simplification covered above, many existing modifications will stop working and will need to be significantly re-engineered. In fact, even nonstandard configuration choices may stop working.
- In the true cloud version of S/4HANA, traditional modifications will not be allowed.
In other words, organizations that have modified their Business Suite software heavily face a significant roadblock on the path toward S/4HANA.
So, how are S/4 HANA systems extended or modified? The official platform for extension is the HANA Cloud Platform (HCP). The general idea is that SAP users and partners will be able to create small applications on HCP that can register themselves as extensions at predefined extension points in the S/4HANA applications. For a high-level view of how this will work, look at SAP's description of the extension platform for its SuccessFactors product.
S/4HANA requires preparation
HANA is obviously integral to the S/4HANA product. One can argue whether this makes sense, but SAP has clearly made the decision to tie the future of its Business Suite product to the HANA platform. In the case of a true cloud version of S/4HANA, this makes little difference to the users. But in the case of a managed hosted or on-premises version of S/4HANA, users will be responsible for at least part of HANA system administration.
So, how can people prepare for S/4HANA? I believe these are all things that responsible users are doing anyway, but perhaps S/4HANA will provide the nudge necessary for those not up to speed in these areas:
Work to move away from modifications and creative configuration. Move toward standard configuration with properly architected and interfaced supporting applications where necessary. If you don't already have a catalogue of user-exits, business add-ins and modifications in your systems, build one. You'll likely be surprised at the extent of modification you have to deal with. If you do have a catalogue, start getting rid of these enhancements whenever possible. In most cases, a large percentage of such enhancements are unnecessary because the business need could have been met through standard configuration.
Document your business processes and regression tests. Ideally, most of your regression tests should be automated, but this is rare in the SAP ecosystem. At the least, business-critical processes should be documented along with comprehensive regression tests. This documentation is critical to running regression testing for any minor upgrade, and even more so for a major upgrade.
Be up to date on the current version of software you're running. Being far behind on support packages or enhancement packs on your SAP software raises the risk of upgrade. Whenever possible, choose the lower risk method of apply smaller updates on a regular basis over the extremely high-risk method of every year or so.
Make design a competency, especially if you extend your SAP software. If you don't have the capability to align your extensions with SAP's design direction, you will reduce the benefit of the improvements in user experience design that come with the S/4HANA updates.
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Users cautious about S/4HANA
Next-generation Business Suite unveiled