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SAP S/4HANA®: Wait or Full Steam Ahead?

Many of my clients are wrestling with the decision of whether to dive into SAP S/4HANA. Walking the impressive show at SAPPHIRE and listening to the barrage of messaging coming from SAP and their implementation partners, you would think that any company choosing to wait is sure to meet a gruesome and untimely end. However, like any IT implementation, the challenge is less about the actual implementation and more about making the decision of whether and when to implement.

Almost every company considering a new infrastructure has struggled with the never-ending hurry-up-and-wait, I’m-sitting-on-the-fence, let’s-see-what-my-competition-is-doing syndrome. Do you jump on the latest technology or wait until it becomes proven, more mainstream, and hence less risky? Waiting could prove detrimental and put you at a competitive disadvantage. Jumping in too early… well it’s called bleeding edge for a reason. You could be testing software for someone.

So what is the most common time for people to implement new software or software upgrades? More often than not it’s when business users have complained so much about breakages, lost, or unfulfilled sales orders, or impacts to revenue. However, the ideal time for IT implementations shouldn’t be driven by pressure to solve a crisis. The ideal time should have already been decided and defined in an IT roadmap or strategy. If you don’t have one of those lying around, it’s time to make one.

Whether or not you know where you want to go, you should at least understand where you’re generally heading. Are you planning to go into digital commerce? Are you expanding into new markets and hence need a stable infrastructure to facilitate growth? Are you looking into how the Internet of Things (IoT) with connected devices could impact your bottom line? When your IT Strategy is aligned with your business strategy, you know your software upgrades and implementations are less likely to introduce unnecessary risk.

Once you understand this, especially at a high level, then you’re ready to start peeling the onion on how to get there. Technology, processes, and finally people all come into play and should be accounted for when coming up with that magic number… the budget. Everyone wants to know the cost of getting where you want to go, not to mention the potential returns on investment.

Many companies’ leaders may or may not take on this challenge. Some IT executives take a bottoms up approach to collecting input into strategic initiatives. If this sounds like passing the buck, it isn’t. It is actually the smart thing to do to cast a wide net on ideas.

The strategic jump to S/4HANA is a logical one. It’s really a matter of understanding why you need it and when. SAP is investing heavily into this product and it will be the landscape for the foreseeable future. It certainly has all the architectural smarts for growth. I would suggest investigating the why’s. Why is it important to the business? What are the returns? Does it provide a solid platform for growth? ECC is still running strong and it will be supported and enhanced until 2025. So, you do have some time but use it wisely. S/4HANA has definitely become more mainstream. Don’t be late to the game. In fact, we can help you get there.

This is an introduction to Clarkston Consulting’s latest blog series that’s highlighting the business case supporting an upgrade to S/4HANA and outlining the considerations for staying with ECC.  Subscribe to our blog to stay up to date on this series, including our next post on how SAP S/4HANA impacts Financial Management processes.

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