The transformative landscape presented by the cloud-based SAP S/4HANA is allowing organisations to attain their business goals by providing a foundation of intelligent, seamlessly integrated solutions. A preeminent force in enterprise resource planning, SAP S/4HANA enhances businesses’ flexibility and efficiency in equal measure.
NTT DATA’s whitepaper ‘SAP S/4HANA: The Road to Transformation’ tracks the path to adopting this agile, flexible and scalable solution, by breaking the process down into three discrete phases: preparation, adoption and post-adoption, and examine how the solution continues to evolve post-deployment.
Making the transition to the digital native Enterprise Core is a complex process that should be undertaken with the right guidance. The journey can be simplified using intuitive guides, following best practices and expert advice, to guarantee effective delivery. NTT DATA’s discovery process begins with an examination of an organisation’s specific circumstances before they move to an ERP solution with significant cloud enablement:
Early in the process, an understanding of the company’s aims and priorities in the transformation is gathered, to inform what’s to follow. Discovery then begins with intensive analysis of the current business model, including any projects that are already under way, to understand the existing solution’s lifecycle and the potential added value of SAP Maintenance. The main areas of focus of the forthcoming transformation can then be clearly identified.
This stage examines theimpact of transformation on current applications, on short- and medium-term decision-making once dependencies within the ERP landscape are taken into account. Preliminary implementation activities, and where the transformation process is likely to begin, can already be determined at this point.
All stakeholders are involved in this in-depth evaluation of dependencies and to agree on short and medium-term actions to be taken. Global ERP adoption is an evolutionary process and this is the point at which that evolution can begin to be mapped out.
Total cost of ownership for the solution can be defined for each option presented here, and recommendations for which alternative approaches may be adopted are provided.
At this point the organisation’s senior management must use the data compiled from the process to date to assess the business’s strategic requirements and priorities, and make a firm decision on moving forward with the transformation. This stage is known as the Decision Gate.
Having received the go-ahead, NTT DATA now drafts a complete roadmap for change that includes organisational, cultural and business actions, including technology modifications. This step lays down further key decision points, as well as governance requirements, in the lifespan of the project.
The transition process is key to delivering a seamless and low-risk shift from a business’s current structure to its envisioned future set-up. Profound change initiatives of this kind, particularly those dealing with the enterprise core, are at risk of failure if they fall into the understandable trap of focusing purely on technological aspects.
Transforming to SAP S/4HANA initially throws up a critical decision for CIOs. They must determine whether to establish an entirely new instance (Greenfield) or adapt existing investments (Brownfield or Bluefield). Although the Greenfield approach of course comes with the benefits of leveraging all of the latest technologies, it also requires significant investments in terms of both time and resources.
Faced with the prospect of writing off substantial investments, many businesses instead opt for a pragmatic, hybrid or ‘mix and match’ approach. This entails a system conversion with selective data transition that allows organisations to strike a balance. It is a complex procedure, however, and one that requires careful consideration by both IT and business leadership.
In technical implementation terms, NTT DATA employs a refined SAP Activate Plus toolset and methodologies. This encompasses project governance, change-management layers and a comprehensive approach to redefining, optimising and implementing SAP solutions in a cloud environment. It is divided into eight layers that address practical actions for implementing technical change, alongside risk, procurement and integration, to adapt to the project’s agreed limits and deliver functional solutions.
Understanding that change is a fundamentally human concept, NTT DATA approaches any transformation on three specific levels: the aforementioned technical and functional one, a human and organisational level and then in terms of governance and active review. The human and organisational level involves blending a logical change process flow with feedback loops and mobilisation activities.
A flexible plan accommodates regular updates based on evolving circumstances, and helps in the ongoing task of demonstrating the reasons for, and benefits of, the transformation to anybody within the organisation who may be resisting the change. As such, change activity therefore progresses through four key stages:
• Understand Gain stakeholder buy-in
• Plan Revise the plan if necessary to ensure it’s fit for purpose and realistic
• Deliver Implement the process as planned, led within the organisation by senior management
• Embed Ongoing monitoring of the organisation’s post-transformation processes, ensuring the new platform has become the accepted norm.
Governance is integral to the success of any transformation project, with stakeholders and particularly senior management being actively involved at all crucial points. In accordance with the Project Management Institute PMBOK process, all nine core functional areas—integration, scope, time, cost, quality, resource, communication, risk and procurement are thoroughly and constantly reviewed, ensuring issues are spotted quickly and swift action is taken. Major change is unattainable without strong leadership, providing a clear purpose while allowing for flexibility in execution.
Ultimately, making the switch to SAP S/4HANA is about helping businesses to become faster, more agile, more responsive and, consequently, more competitive. The final stage of the transformation journey entails establishing processes to consolidate the changes made. This means finding balanced and consistent working methodologies under the new structure, while remaining agile enough to implement improvements on a continuous basis.
The whitepaper can be downloaded here. In our next blog entry we’ll examine NTT DATA’s particular experience and expertise with the SAP ecosystem, as both Platinum and Global Service Partners.