When the going gets tough, it is always a good idea to stay cool and move forward strategically. Many SAP customers agree as they navigate the crisis triggered by the pandemic. Every hour of a business day, somewhere in the world, a company goes live with SAP S/4HANA, supported remotely by SAP and SAP partners.
“When COVID-19 and the lockdowns took the headlines, we at SAP naturally gave it a lot of thought,” says Uwe Grigoleit, senior vice president and general manager for SAP S/4HANA. “How would our customers cope with it? What would that mean for ongoing implementation projects with SAP S/4HANA?”
It did not take long for the answers to arrive. Projects would continue as planned almost without exception. Decision-makers from a wide range of companies and industries have recognized that they not only have to react quickly to the crisis and its consequences, but also must build resilience and potential for the future.
Unleash Possibilities Quickly
In this unprecedented situation, many organizations need to reorganize critical processes and map them digitally. It has become apparent that legacy enterprise management systems can be more of a burden than a help. There is a lack of necessary financial and operational transparency to safely adjust to the new normal.
“Many companies have realized that they now need to focus all the more on their core business and strengthening their resilience, instead of spending valuable time and resources on managing IT systems and running their own data centers,” Grigoleit says.
SAP and its partners are well prepared for this. Every implementation project and go-live of SAP solutions can be supported and executed remotely. It therefore came as no surprise that 75 percent of all SAP S/4HANA Cloud customers that had planned to go live in the second quarter of 2020 went live. Currently, there is one go-live of an SAP customer with SAP S/4HANA every hour of every business day.
More Resilience and Innovation Through the Cloud
While the on-premise edition of SAP S/4HANA is functionally very comprehensive and modular, the cloud solution is more straightforward. This can be a big advantage, especially if time is of the essence. Standardization allows companies to more efficiently establish end-to-end processes based on best practices. This way, SAP S/4HANA Cloud provides value faster and offers superior flexibility, scalability, and agility compared to traditional enterprise resource planning (ERP) systems. This results in more resilience and capability for innovation.
In financial terms, too, moving to the cloud solution offers major advantages. Traditional, in-house models for data centers require a huge investment – capital expenses or CAPEX – in equipment, software, and a workforce to run and maintain everything. SAP S/4HANA Cloud switches IT spending to a pay-as-you-go model. From an accounting point of view, this means that only operating expenses (OPEX) arise. These expenses, unlike CAPEX, do not have to be depreciated or amortized over their useful life, but can be directly deducted in the relevant tax year. Less CAPEX also means that companies have more budget available for other important business investments.
Combining the Best of Both Worlds
Depending on individual business requirements or strategic vendor relationships, existing SAP customers can choose between public and private cloud or hybrid models with SAP S/4HANA. SAP can serve hybrid, or two-tier, ERP scenarios from one common code base and one single semantic model. This allows SAP customers to set new strategic priorities and to move individual capabilities to the cloud quickly while other areas of the business remain on premise.
From the user’s perspective, the transition to a hybrid model is hardly noticeable. Unified user interfaces (UI) help ensure that the user experience remains consistent when switching between cloud and on-premise systems. They can find their way around immediately and work productively because, for example, the capabilities for analytics and reports look and function the same.
To support companies in their decision to become intelligent enterprises with decisively more resilience, agility, and responsiveness, SAP offers custom-made value starter packages, which create perspectives and inspiration for process optimization and innovation. Proven best practices of SAP customers illustrate what can be achieved with SAP S/4HANA, namely making companies more resilient and fit for the future.
Oliver Schoenborn is interim head of SAP S/4HANA Cloud Product Marketing.
This article first appeared on the SAP News Center.