Thousands of organizations now have to make the transition to SAP S/4HANA from ECC 6.0. Others are choosing to move to SAP’s ERP from another system.
We sat down with Cognitus EMEA’s Vice President of Sales, René van der Zanden to discuss approaches organizations can take in making those transformations more successful.
From small organizations to large enterprises, taking the time to fully understand and plan the transformation before taking any steps is often key.
“Organizations are often aware they have to make the shift to more flexible environments like the cloud. Whether that’s for compliance, cost management, or maintaining business ability to compete on the market doesn’t matter – they know they have to do it and may even have tools. But, they still have to move the ERP. That’s a big project. If you plan it well, you can move to a new ERP in stages, ensuring adoption and smooth rollout at every stage. If it’s not well-planned, it will be late, costly, and not well-accepted.”
“Making the move from ECC to SAP S/4HANA is really a great time to assess your existing business processes, to decide what you really need, what you can move to Best Practices, and really make your infrastructure much leaner and low maintenance. But you don’t have to do it all at once”.
“That’s part of Cognitus’ approach as well. Our business model starts with an assessment, our Gallop Discovery and Assessment give most organizations an easy foot in the door. You get a good idea of what your data looks like in SAP S/4HANA, get some hands-on experience, evaluation of different implementation scenarios, get a roadmap tailored to the customer situation, business plan, and costing analysis that we provide.”
From there, Cognitus also enables organizations to break the transformation down into multiple steps. A Brownfield transformation allows IT to complete the project of adopting SAP S/4HANA and limiting the impact for the rest of the business. Once that’s in place, the organization can start the business change and people and process change management to move towards SAP S/4HANA Best Practices and to standardize the business.
“That can lower risk, reduce time to complete the project, and reduce the amount of internal buy-in you need to just get started. Moving forward with just the technical “IT” part of the SAP S/4HANA transformation will allow you to get the ball rolling in ways that waiting for full stakeholder sign off on a massive business change project never will”.
The technical steps of aligning the transformation with business goals, getting business buy-in for the stage of the transformation you’re in, and really selling that change to the people impacted is of course, important. That should range from comprehensively evaluating the environment as a whole to looking at individual departments like finance, sales and marketing, and procurement, to ensure that everyone is getting something that adds value out of the transformation.
Most organizations don’t have internalized SAP S/4HANA knowledge, especially not for transformations. It also often doesn’t make sense to create that knowledge. Most rely on system integration partners and trusted advisors – who can offer insight into the industry, the project, and the full scope of technology, business, people, and processes transformation.
“I started my career in commercial Consultative Selling. I’d look into what’s best for the customer, what the best business case is, what opportunities are there. Most importantly I started in 1993, selling computers and integrating them into networks, then integrating networks, then mainframe to client-server, smartphones, and then we moved to the cloud. I’ve been through every phase of it, with different parts of the IT Landscape becoming more important over time.
You’ve also increasingly had to keep new information in mind. Master Data Governance, information security, compliance. We’re not in an industry where you can replace the human factor with a robot. A good transformation project is still driven by experienced people disclosing that experience and sharing insight into how those projects should run – so everyone involved can make the right decisions.”
“Organizations can often do much of the research themselves with the Internet – and only rely on consultants for extra insight. Having someone on hand to deliver that insight into technology, tooling, options, and solutions is critical for setting up a successful project.”
At the same time, you also want that kind of insight as you start rollout. Having consultants on hand who know what this project should look like, what’s gone wrong in the past, and how to optimize it can make major differences in the project. You need people who offer added value and really understand how their solutions fit into your business.
“If you look at the definition of success for any transformation project, it’s very often personal. You can look at it from the perspective of hard KPIs. At the same time, you (very often) have to look at it from personal business goals.”
“For example, happy employees, happy customers, and good relationships with partners. You can look at any hard numbers you want, but if those baselines aren’t there, those numbers don’t really mean anything. Success is always measured by revenue and margin, and setting baselines upfront is important. But if you have appreciation from your customers, the rest will come on its own. “
It’s always important to set KPIs and goals to track, but soft results are just as important as the hard numbers. However, that should involve an evaluation phase, where you periodically check in on the transformation, what it’s achieving, and if it’s creating the results you want. Starting with a comprehensive assessment and roadmap, ensuring the transformation is aligned with strategic business goals, and rolling that transformation out in stages that map to different parts of the transformation (Technology, Process, Business) will put you on the right track to success.