SAP S/4 HANA migration – see which approach fits your company

February 7, 2018

Introducing SAP S/4 HANA

SAP S/4 HANA is SAP’s next-generation business suite, launched in February 2015. This product is designed as a new, standalone ERP tool for enterprises, but it did evolve out of SAP HANA. The SAP S/4 HANA specific LoB solutions replace the former SAP Simple solutions, and are as follows:

  1. SAP S/4HANA Asset Management
  2. SAP S/4HANA Finance
  3. SAP S/4HANA Human Resources (SAP S/4HANA HR)
  4. SAP S/4HANA Manufacturing
  5. SAP S/4HANA Marketing
  6. SAP S/4HANA Research and Development

(SAP S/4HANA R&D)

  1. SAP S/4HANA Sales
  2. SAP S/4HANA Service
  3. SAP S/4HANA Sourcing and Procurement
  4. SAP S/4HANA Supply Chain

How is SAP S/4 HANA structured?

The way SAP positions SAP S/4 HANA is this:

First, we have the S/4 HANA Enterprise Management (“the core solution that covers the critical business processes of a company”). This is a new complex tool that provides “simplified processes built natively on HANA with streamlined data structures and enhanced user experience, delivered as part of the S4 user-based license”.

Enclosed we find the S/4 HANA PRODUCTS, which are “separately priced S4 branded components, optimized for HANA that will be deliverable embedded with the S4 landscape”. Some of these products are available independently of S4.

Outside the S/4 HANA Enterprise Management are the SAP Cloud Products that compose the SAP S/4 HANA Suite, together with the LoB core functionalities. These are deployed alongside S/4 HANA, with standard integrations and including both on premise & cloud solutions.

When considering SAP S/4 HANA migration, the companies have these 2 main options: the Greenfield approach and the Brownfield approach.

What is the Greenfield approach?

The Greenfield approach translates into re-implementation. It works by implementing a new system, followed by data migration. Some don’t even see the Greenfield approach as migration, but as an installation. Although this approach is the option recommended by SAP, the majority of the organizations finds it too big a move, and in consequence avoids it.

However, the foremost advantage of going Greenfield is that the client goes clean slate. A new system has more flexibility and will better support any desired additional customization. Also, this method enables complete re-engineering, process simplifications and pre-defining your “migration objects and best practices, lowers Time-to-Value and TCO”.

There are a few needed requirements, in order for this Greenfield approach to be possible. Respectively, the client needs a minimum EHP level with the S-Innovation package. Choosing to go Greenfield does require a higher effort, but it also means starting off with a new SAP system. This may be an important plus.

A study dating from June 2017 shows that only 25.7% of the implementations were completely new (Greenfield type). The remaining 55.7% were conversions or transformations (Brownfield type).

What is the Brownfield approach?

As you may have already guessed from the above section, the Brownfield approach means upgrading your existing system. Most organizations choose this method in the spirit of safeguarding their previously-made investments. Brownfield also provides a lesser disruption of the ongoing activities. This approach practically represents upgrading the current SAP System to SAP S/4 HANA.

This method fits the entire SAP System migration, or it can split into separate LoB Brownfield system upgrades. Adding a consolidation stage at the end of these separate upgrades can take the complexity of the process to a whole new level. Nevertheless, depending on the structure of each organization, this might be the safest option.

Otherwise, Brownfield qualifies as the shorter run time method. There are two possible scenarios, depending on the organization’s installed base:

  • When you have the SAP Business Suite on a regular DB ( here an upgrade to ECC6 minimum EHP level comes first, followed by the migration of the DB to SP HANA, and then by the installation of the S-Innovation package);
  • When you have the SAP Business Suite on HANA (here the installation of the S-Innovation package is the only required action).

As we mentioned before, most of the organizations opt for the Brownfield approach, in view of ensuring the operations continuity. Also, the clients often desire to get the most of their previous investments in their already-existing SAP systems, as well as to keep their already-existing customizations, instead of reproducing them in a new system.

Our recommendation

SAP is all about personalization. As a modern company, you should definitely think ahead and explore the possibilities brought on by SAP S/4 HANA. SAP continuously invests in this new tool, and integrates innovative features and extra compatible tools. In other words, SAP S/4 HANA is definitely the solution for a successful future in business.

In what the two types of approach are concerned, the personalization rule applies to the extent that you really need to get an SAP consultant’s expert advice before making up your mind. Depending on the structure of your organization, on its specific needs, on the nature of your activity, size and other characteristics, the final decision may be either Greenfield or Brownfield. As a general rule, copying what others did is not the best way to solve this crucial point. The specialists’ advice is essential.

Brownfield is the statistic winner so far, due to the reluctance in starting from a completely new SAP system, manifested by the majority of the SAP clients. However, this is just a past tense fact, valid at the moment this Panaya crowd wisdom survey took place and it definitely cannot replace a proper consultancy session.

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