The article delves into the strategic considerations for CIOs contemplating the migration to SAP S/4HANA on RISE, addressing the benefits, challenges, and long-term impact on organizational agility, competitiveness, and future readiness.
In the realm of enterprise technology, few decisions carry as much weight as migrating to a SAP S/4HANA system. For today’s Chief Information Officers (CIOs), the looming question is whether to adopt SAP S/4HANA on RISE now or defer the decision. This dilemma stems from SAP’s announcement mandating all existing ECC customers to transition to SAP S/4HANA by 2027, along with adopting the RISE platform.
The Pressing Questions
“Why should we migrate to SAP S/4HANA on RISE, and what benefits will we gain from this migration?” These are the fundamental queries that echo in the minds of CIOs across industries. The directive from SAP AG has significantly raised the stakes, compelling IT leaders to justify the substantial costs—financial, operational, and technical—involved in such a migration to their CFOs and boards.
“The decision to migrate to SAP S/4HANA on RISE is not merely about compliance with SAP’s timelines but a strategic move to drive efficiency, innovation, and competitiveness.”
Vipul Shah, Vice President of Digital Practice, Tata Technologies
SAP S/4HANA Adoption rate
As per Gartner report published on October 2023, SAP ECC to SAP S/4 HANA migration rate is as follows:
Key Considerations for HANA migration:
- Future Readiness: One of the primary motivations for migrating to SAP S/4HANA lies in future-proofing the organization to support new business model & new-edge technology adoption.
- Digital Transformation: Treat the migration as a pivotal step towards digital transformation, especially for organizations that have relied on SAP for over two decades amidst various business transformations.
- Smart Manufacturing: Integrate ERP, PLM, and MES seamlessly to enhance manufacturing processes and enable end to end parts traceability.
- Data Security: Ensuring data security to prevent cyberthreat and persona data.
- Competitiveness: Faster decision making, Agile product development.
- User Experience: Improve usability with device-independent applications.
- Real-time Data Aggregation: Facilitate operational decision-making by leveraging real-time data.
- Finance Optimization: Expedite monthly financial closings and enhance financial processes.
- Inventory Optimization: Streamline inventory management to optimize operations. Line side Inventory etc.
- Machine Learning and AI: Evaluate readiness to harness ML/AI capabilities within the new platform.
- Sustainability Reporting: Enable robust reporting capabilities to meet sustainability goals.
- Hardware and Licensing Considerations: Assess whether to incur capital expenditures or opt for operational costs during hardware refresh and database license renewals.
- Satellite Application: Opportunity to get rid of home-grown or bespoke application developed on different platform due to limitation of SAP standard solution in ECC. With help of SAP S/4HANA and BTP ecosystem, these functionalities/processes can be developed in innovative way. This helps to reduce additional HW and Application maintenance cost.
- Clean Core: System design with minimal customization, reduction of technical debt and adoption of standard functionality (following best practice) which accelerates the innovation and reduces adaptation efforts.
Conclusion
The decision to migrate to SAP S/4HANA on RISE is not merely about compliance with SAP’s timelines but a strategic move to drive efficiency, innovation, and competitiveness. While the challenges of cost and complexity are undeniable, the potential benefits in terms of agility, insights, and operational excellence are equally compelling. CIOs are tasked not only with navigating these complexities but also with charting a course that aligns technological investments with broader business objectives.
As organizations embark on this transformative journey, the key lies in meticulous planning, business case preparation, stakeholder alignment, adoption of innovation & industry best practice and leveraging the expertise of partners like Tata Technologies to ensure a seamless transition and maximize the ROI of your SAP investments.
In essence, the question of whether to migrate to SAP S/4HANA on RISE is not just a technological one—it’s a strategic imperative that defines the future readiness and competitive edge of enterprises in the digital age.
Profile:
Vipul Shah, Vice President of Digital Practice, Tata Technologies brings nearly 30 years of experience in ERP implementation. He plays a crucial role in collaborating with Chief Information Officers to develop future-ready IT landscapes aligned with their company’s growth strategies. Additionally, he provides insights into the latest innovations in the manufacturing industry to ensure clients stay ahead of the competition.
