SRB goes SAP S/4HANA, Part 1: The IT Service Provider Takes Charge

Just recently, some of our colleagues received a new SAP certification: 10Steps2S4. We wanted to use this as a starting point to tell our own SAP S/4HANA journey. In December 2022, we arrived in the world of SAP S/4HANA. We, as SRB. As a small to medium-sized IT service provider, we did what we recommend to our clients and switched to the new platform from the Walldorf software house.

Our journey began in November 2021, as many of our projects do, with five small words: “Christian, do you have a moment?” These words came from one of our managing directors, Lorenz Juen. He had an idea, and during the conversation, it quickly became clear that it was time for us to transition from SAP ECC 6.0 to SAP S/4HANA.

By now, we had gathered enough experience with it and the platform itself since 2015 through numerous client projects, including various clients like Polytec, a tobacco wholesaler, and a company in the oil and refinery sector.

Discover – Analysis on a Small Scale

The first task was – as it usually is for our clients – clear: conduct an analysis. For this, I coordinated with my colleague Herwig Stecher regarding new hardware and the technical transition.

At this point, we would have conducted a 'Discovery Workshop for SAP S/4HANA' with the client. However, this was omitted for us, as the scope of our IT was manageable compared to some large corporations, and the goals of the transition were largely already established.

In principle, the outcome of such a workshop is the definition of the strategic goals of a transition and the development of a roadmap. In this context, a current state analysis of business processes, systems, and data is conducted to understand the current situation and identify where the challenges and improvement potentials of a transition lie.

Usually, a listing of the objects of consideration in the form of a mind map helps to determine the scope of the project. How it was for us is shown in the following graphic:

Figure: Objects of Consideration SAP S/4HANA @ SRB

Prepare: We're getting there

However, the next step on our path was significantly more complex and extensive. A first readiness check was conducted by Martin Kasper, Customer Innovation Management – essential for an SAP S/4HANA project. Three phases must be traversed:

1) Preparation

This involves implementing notes. Notes represent the SAP standard tool for program corrections and describe how known errors in SAP systems can be resolved. The transaction SNOTE, the note browser, is very helpful in this regard. The most important notes for us were

• 2502552 - S4TC - SAP S/4HANA Conversion and Upgrade of New Simplification Item Checks
• 2913617 - SAP Readiness Check for SAP S/4HANA

Depending on the system's patch level, this can be more or less complex. “You even have to remove notes to implement newer ones,” was heard from Martin Kasper.

2) Execution

After preparation, it gets serious: Using the report RC_COLLECT_ANALYSIS_DATA, it can be selected which checks should be performed.

Depending on the scope and size of the system, the runtime may vary. Therefore, this should be planned during a booking-free period. The result of the readiness check is downloaded into a ZIP file and uploaded to theSAP Support Launchpad.

3) Evaluation

The core question that arises during evaluation is: What does the SAP Readiness Check for SAP S/4HANA migrations include?

The SAP S/4HANA Readiness Check is a tool developed by SAP to verify whether your current ERP system is ready for migration to SAP S/4HANA. This check analyses various aspects such as business data, processes, and programmes in your system to identify necessary adjustments.

The SAP S/4HANA Readiness Check includes several fundamental checks, including:

• Simplification Items:A list of objects that have either been modified or are no longer present in SAP S/4HANA.
• Sizing:The calculation of the required database storage for the SAP S/4HANA system.
• Integration:The verification of active IDoc interfaces and extractors.
• Custom Code Check:The review of custom developments.
• Business Process Discovery:An analysis of the processes present in your system. Using provided KPIs, potentials or weaknesses in your system are uncovered.
• Add-Ons:The review of third-party extensions.

Additionally, there is the possibility to include further checks, such as an analysis of financial data or business partners in the SAP S/4HANA Readiness Check.

During the readiness check, the relevant objects that needed attention during the transition were identified. For us, this included the transition to Business Partner (CVI), new asset accounting, and adjustments to our custom code.

An important outcome from the readiness check was also the statement on whether there are so-called 'showstoppers' in the existing system. These could be add-ons that cannot be uninstalled. Further information on the preparatory activities for the SUM could be found in the PreCheck Report '/SDF/RC_START_CHECK'.

And even more preparation

Anyone who thinks that was it is mistaken. The next step was to find the right people for the project and assemble a competent core team. In a house full of consultants, we had the luxury of choice and the opportunity to form a team with the 'crème de la crème' of the SRB consulting landscape. In other words, a team with the employees who know the system and processes best.

To do a bit of name-dropping: Among these consulting colleagues wereThomas Meizer, Michael Breiner, Lorenz Juen, Norbert Leimgruber, Herwig Stecher, Andreas Kasper, and Ursula Zanitzerto be found. They were supported byVeronika Wolfgruber and Manuel Bogner.

To harness the expertise of all these SAP professionals, we decided to conduct individual interviews based on varying availability and time, divided into the following areas: Hardware & SAP Basis, Processes, Custom Code, Reporting, and Interfaces. In this process, the scope of the current system and the areas where something needed to be done during the transition were developed and established.

Furthermore, a project team formed based on the topics to be addressed, which changed depending on the phase or was adjusted due to specific expertise:

For completeness, it should not be forgotten that part of the prepare phase also includes a pre-study, which allows for a closer look at the transformation path, scope, and project plan.

Brownfield, Greenfield, or Hybrid? The Dilemma for Us Too

Like all other clients, we faced the dilemma and decision of which path to SAP S/4HANA would be the right one for us. Since Greenfield corresponds to a new implementation, resources such as costs, time, and scope would be high for a company like ours.

The same applies to Hybrid. The hybrid transition occurs on a shell system and is particularly interesting for large companies and global system landscapes with company codes and plants in the two to three-digit range. This is also the most expensive option, as specialised services from SAP or SAP partners are required.

So, Brownfield remained. Brownfield is the fastest, most economical, and simplest way to transition to SAP S/4HANA. Special attention must be paid to the preparatory work involving simplification, archiving, and custom code cleansing. Due to our manageable master data, no harmonisation or cleansing was necessary or planned. What sounds like the simplest option should not be underestimated. For Brownfield also has disadvantages. Selective transitions or system splits or consolidations are not possible, and old data that is no longer needed will remain in the new system.

Even though it seemed obvious at first glance, and despite our many years of experience, the decision for the right transformation path was more difficult than expected. On one side was the innovation potential offered by SAP S/4HANA – especially regarding the mapping of processes, user interfaces, and reporting options, while on the other side was a desire for a swift and cost-effective implementation of the project, with the option to utilise the full SAP S/4HANA innovation potential at a later date.

Which path should it be? Depending on the department and interests, opinions were contrary. It was important for later success to hold discussion rounds and listen to all these opinions. Ultimately, a decision had to be made that would be supported by all. The compromise solution was: 'Let's transition now and later evaluate SAC, the C4C connection, and new process design,' was the consensus. So, Brownfield it would be.

Once that was clarified and decided, we of course also took a close look at the corresponding transformation path regarding the Brownfield approach:

In November 2021, we were at the end of the prepare phase, and our first project plan for the migration was established. Unsurprisingly, this would change over time. It is worth noting that we further divided the realize phase – firstly into a phase for implementing the preliminary projects (EHP8 Upgrade & CVI) and secondly into the technical SAP S/4HANA implementation. As experience from other projects showed, planning is very important. Considerations and preparations are reflected in the following high-level overview of the project. Here, the essential phases and key activities are visible.

A Piece of the Journey

The glorious team, the transformation path, a timeline, and the 'rough' goals were thus established. A small piece of work was done. To ensure everything ran smoothly and timelines were met, not only was a project plan created, but regular meetings were also introduced. Everyone should always be clear about what needed to be done.

Planning also had to take into account other factors such as supply chain issues with hardware due to COVID. Thus, the planned delivery of hardware for us was not before April – this buffer had to be considered and built in. To further minimise risk, a phase for preliminary projects was also planned, during which an upgrade to EHP8 and the CVI transition took place.

In summary, the focus during these phases from the idea to the first planning was to determine what the scope of the project would be and how we could implement it with which resources. The analysis of processes was important to determine the scope. The strategy for implementation was relatively clear in the end, despite numerous discussions due to the 'size of the system'.

A significant point is also securing the necessary resources and starting the project planning based on the insights of many, which was then refined in the subsequent phases. The foundation was thus laid before the next phases, Explore & Realize, would truly begin. But that will be for next time.

Strategies & Methods

If you are also facing migration to SAP S/4HANA or have questions about our path to the new platform, simply contact me. Additionally, I have compiled interesting supplementary information here regarding the first two phases of the transformation path:Information Sheet 1: Strategies & Methods