When it comes to deciding whether or not to adopt SAP HANA and SAP S/4HANA, customers are placing the business case and the potential added value of adoption at the center of their deliberations.
In this interview, Christian Hopfner, head of Business Development at All for One Steeb, shares his assessment of the potential offered by SAP’s next-generation business suite.
Q: All for One Steeb’s customer base of around 2,000 – chiefly SME – clients is the largest served by any reseller in the German-speaking region. The first of these customers have already migrated to SAP HANA and are “ready” for SAP S/4HANA. What is their motivation for making the switch?
A: Customers’ motives for switching to SAP HANA are highly individual. In this context, a company’s size is pretty much irrelevant. Factors like investment protection, TCO, and line-of-business requirements play a much more central role. As do considerations such as the ability to simplify day-to-day tasks, make better decisions faster, and remain agile and innovative in the face of market pressure. What might seem on the surface to represent a potential conflict of interests is something that we see in a more differentiated way, and we discuss this with our customers and prospects.
Despite their reservations, many of them recognize that the SAP HANA platform is the foundation for consuming key innovations that will help IT meet the growing demands being placed on it by lines of business and by the market. As such, IT has the potential to become an innovation driver and lose the image it (regrettably) still has in many quarters of being little more than a cost factor.
Q: SAP S/4HANA promises to cut through complexity. What’s your impression? Does the new generation of SAP Business Suite deliver simplicity?
A: To answer that question, you have to wind the clock back a few years. When SAP launched SAP R/3 in 1992, all the applications were integrated. But new requirements kept on emerging; new and more complex processes and analyses were needed; and new planning tools were developed. The relational databases on which R/3 ran were too slow for these new functionalities. So customers began running their systems separately from one another. This led to new interfaces being developed, some of which required separate systems to monitor them.
The SAP HANA platform has the technical capacity to tie all these elements together again. So, from the application-centric perspective, SAP S/4HANA running on SAP HANA is the logical successor to the relational database setup. Granted, the initial focus in SAP S/4HANA is on “core” topics such as ERP. But that will change over time as more and more functions return to the new business-suite core. At the end of the day, it’s all about consolidating the system architecture and IT landscape, delivering functional improvements in ERP, and enhancing the user experience.
Q: SAP S/4HANA is – to use SAP’s description – “Fiori-ized”. How significant is that from the enterprise perspective?
A: Business users now expect high standards of usability. In the eyes of younger users ‒ the so-called “digital natives” ‒ especially, the SAP GUI is not necessarily their idea of what constitutes an enjoyable user experience. SAP HANA is making it possible to apply new user experience (UX) principles – like the ones we’re familiar with from the SAP Fiori apps – to SAP S/4HANA applications.
But it would be too simplistic to think of “Fiori-zation” purely in terms of slick user interfaces. Because optimizing the UX is not an end in itself. The real challenge is to ensure that the software we deliver gives users the best possible support to perform their tasks efficiently and well. And that includes having efficiently mapped processes, the ability to decide which KPIs appear on a financial fact sheet, and the flexibility to work on any end device ‒ be it mobile or desktop-based.
On a more general level, it must be possible for users to access and consume all the information they need simply and instantly. Again, that has nothing to do with a company’s size but with the requirements its users and lines of business place on it.
Q: On that basis, would you say that lines of business play a key role when it comes to implementing SAP HANA or considering a switch to SAP S/4HANA? Which lines of business tend to be the drivers?
A: Well, added value is obviously more tangible for those lines of business for which SAP HANA-based applications are already available. Enhancement package 7 for SAP ERP 6.0 already enables a large number of financials and logistics transactions for SAP HANA. They massively simplify day-to-day tasks and are being well received by customers.
As for SAP S/4HANA, availability is currently centered on the SAP Simple Finance functions for accounting and controlling departments. These enable month-end closing “on the fly”, leverage simplified posting logic to massively facilitate reconciliation between controlling and accounting, and allow highly granular live and ad-hoc reporting in both areas – thanks to the speed of SAP HANA and the absence of aggregates.
With the arrival of SAP Simple Logistics at the end of 2015, customers will be able to benefit from significant functional changes and enhancements in this core area too: I can only say that we’ve been very impressed by what we’ve so far been able to “sneak-preview” at a number of exclusive meetings.
Q: At the moment, only a minority of SMEs are deploying the new generation of software. That goes for both SAP HANA and SAP S/4HANA. How do you see the situation developing?
A: The announcement of SAP S/4HANA is the next logical step for SAP in its SAP HANA strategy. So I can answer that question on a general level. Enterprises that choose to migrate to SAP HANA will enjoy all the benefits of future SAP innovations right up until they have adopted SAP S/4HANA as the new business suite for all their operations.
But each company will follow a different route and progress at a different rate. The decisive factors will always be the business case and the added value to be gained by migrating to SAP HANA. It is obviously much easier for net-new customers to adopt SAP HANA from scratch because they’ve already made that crucial fundamental decision to embrace a complete change.
Our installed customer base, on the other hand, is insistent on identifying the added value behind the SAP HANA scenarios. And we are ready and willing to have these conversations with them.
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