How to Select the Best S/4HANA Migration Strategy for Your Business Success

As we all know, SAP plans to end the mainstream support for SAP ERP by 2027. This is one of the key reasons for enterprises to move to S/4 HANA. Besides the fact that the new version also has a lot of new features to offer.

There are different routes to undertake this journey - system conversion (brownfield approach), re-implementation (greenfield approach), or a hybrid approach to assist in determining the most suitable path for your needs, this blog offers a set of comprehensive guidelines.

Although there are improved and upgraded features in S/4HANA, many businesses are still hesitant to move to the new system. They are comfortable with the SAP ERP Central Component (ECC) system with its robust GUI (graphic user interface) and it works well for them. But with the end of support for ECC coming soon, they will have to scramble to upgrade or pay more for SAP support for ECC.

The resistance to change may be due to various reasons: resource constraints, strategic priorities, change management concerns, substantial financial implications, uncertainty regarding ROI, and so on.

Three SAP S/4HANA Rollout Methods

There are three different approaches to the challenging yet necessary process of S/4HANA migration.

1. Greenfield Approach
The Greenfield approach involves starting from scratch. When migrating from SAP ECC to SAP S/4HANA using Greenfield, it means fully reengineering an organization's SAP processes. Any customizations made in SAP ECC will be entirely replaced in a Greenfield implementation.

The Greenfield Approach involves a full-scale implementation of S/4HANA, fostering process simplification and data migration. It offers a fresh start, allowing for the standardization of practices and embracing future digitalization opportunities, such as automation and innovation.

However, it is a complex and costly process, requiring a significant investment of time and resources, and necessitating comprehensive change management. Despite its challenges, this method provides the benefit of addressing deep-rooted issues and aligning the configuration with the organization's strategic goals.

2. Brownfield Approach
Brownfield (or System Conversion) involves transferring your current processes to a new tech platform. It is a suitable choice for organizations wanting to preserve a custom environment, signature processes, and data as it involves a technical upgrade only. The key benefit is a shorter project time, causing less disruption to your business.

Brownfield allows migrating to SAP S/4HANA without new implementation, preserving existing processes, and utilizing elements like interfaces to suppliers and partners in the SAP landscape.

3. Hybrid Implementation
The Hybrid approach allows you to selectively bring forward some customizations that are essential to the business. At the same time, the data migration can be selective, and unnecessary data can be controlled. It streamlines and accelerates the conversion to SAP S/4 HANA.

Selecting the Right SAP S/4HANA Migration Approach: Greenfield, Brownfield, or Hybrid?

It is advisable to have an assessment workshop to decide the right approach. All major stakeholders, including IT, business process owners and experienced advisory consultants should participate. Although each client may have different priorities, the following are some of the guidelines to help make the right choice:

1. Check if your existing ECC system meets the technical criteria for Conversion to S/4 HANA: SAP provides clear guidelines and pre-requisites for conversion to S/4 HANA. Make sure that your SAP system, Business Functions, add-ons and Industry solutions are supported in the roadmap for moving to S/4 HANA.

2. Check the relevance of customization and signature processes in your existing system: Refer to your process master list and customization list. Check if the processes are still relevant, unique and valid. If it is critical to continue with the custom processes, Brownfield approach may be more suitable.

3. Check your data retention requirements: A greenfield approach is like a fresh implementation. Only the clean master data and open transactions will be carried forward. If you have any requirements for retention of historical data in your live SAP system, Conversion may be a better option.

4. Check your roll-out strategy: If you need a Big Bang approach and a global solution, then Conversion may be a better choice. A Greenfield approach gives you the option to roll-out the solution to different regions/ business units in a phased manner.

5. Align with your long-term strategic goals: If your current SAP system is stifling innovation and growth and you are looking at S/4 HANA as a platform to modernize your processes and leverage AI, ML, IoT, and other intelligent technologies, then a Greenfield implementation may suit you better. It can provide a clean slate with modern technology to implement your strategic plans.

Consider this flowchart, before you decide to choose your approach:

Source - https://blogs.sap.com/2019/05/06/the-right-approach-to-s4hana-blog-post-9-the-epic-battle-greenfield-versus-brownfield/

The answers to these questions form the crux of the transition strategy, ensuring that the path chosen to S/4HANA not only suits the present circumstances but also paves the way for future growth and innovation. The flowchart underscores the criticality of each decision point in this transformative journey, ensuring that organizations make informed choices that resonate with their long-term vision and operational framework.

How Jade can help you in SAP S/4HANA Migration?

Jade Global provides advisory services to its clients to help determine the right roadmap. We can help with system assessment, readiness check, custom code analysis, code modernization strategy, and actual move to S/4 HANA. With Jade, our clients are assured of the following support:

1. Industry Expertise: Access to industry thought leaders ensuring tailored solutions for your business needs.

2. Active Engagement: Participation in customer and industry forums to stay at the forefront of technology trends and developments.

3. Customized Solutions: Tailor-made strategies to optimize S/4HANA capabilities and maximize business value.

4. Holistic Approach: A comprehensive suite of services that address all aspects of the S/4HANA implementation, ensuring a seamless and effective transition.

End Note:

S/4 HANA is the future of SAP ERP. It is critical to choose the right path to move your existing system to S/4 HANA. An experienced SAP advisor can help you with this decision-making. Need Help?