As organizations in all industries shift toward the cloud and pursue digital transformation initiatives, business leaders are increasingly evaluating how, when, and why they should move to SAP S/4HANA.
Since 2020, when SAP announced it would extend the end of mainstream maintenance for SAP Business Suite and SAP ERP Central Component (ECC) to 2027, SAP customers have been initiating transition projects to SAP S/4HANA, with many organizations opting to combine this transition with a move to the cloud and selecting RISE with SAP to do so.
At last month’s ASUG Tech Connect, an inaugural conference for the SAP user community, dialogue around digital transformation flowed freely. One well-attended session featured leaders from three organizations sharing their perspectives on moving to SAP S/4HANA, promoting a clean core, and reimagining business operations.
Moderated by Kristen Scheffler, Vice President of Customer Engagement for SAP North America, the session included insights from Colin Gesink, SAP Solution Architect at Steelcase, and George Grix, SAP Architect at Steelcase; Tim Nguyen, an ASUG volunteer assisting an SAP Utilities customer on an SAP S/4HANA digital transformation; and Nick Corcoran, IS Director, Transformation Office at Rich Products Corporation.
Simplify, Standardize, and Leverage SAP
When SAP announced end of mainstream maintenance for SAP ECC, that 2027 deadline served as a “jump-start” for Steelcase to pursue business transformation through overall SAP S/4HANA implementation and adoption, according to Gesink, who’s already implemented SAP S/4HANA Cloud, private edition, in one business unit.
A leading manufacturer of furniture for offices, hospitals, and classrooms, Steelcase is currently running three main ERP instances on SAP ERP Central Component (ECC), all of which became highly customized across two decades of ABAP development.
“While the 2027 date was the impetus, we’re really looking at this project as a greenfield transformation, and as an opportunity to simplify, standardize, and take advantage of the tools SAP provides,” Gesink said, noting that stronger governance has become a priority for the business throughout its transformation.
To that end, Gesink and Grix sit on a governance board responsible for evaluating every customization proposed at Steelcase in terms of cost and business value. Internally, they describe customizations using a RICEFW (Reports, Interface, Conversion, Enhancements, Forms, and Workflow) model. “A lot of tasks and requests are coming our way,” said Gesink. “But a strong, even uncomfortable level of governance is key.”
That’s not to say there’s no place for ABAP programmers at Steelcase these days, added Grix. Though the IT team is upskilling its developers to work in SAP Business Technology Platform (BTP), certain verticals still leverage limited quantities of ABAP code in RISE and continue to take advantage of business add-ins (BAdIs) to hook custom enhancements to SAP functionality.
Another necessary upskilling, Grix added, has involved shifting from Oracle-based legacy ECC systems to the SAP HANA database. “In terms of exposing our data and creating SAP Fiori tiles, that was a really key component: upskilling on HANA database, and learning how to interact with it,” he said.
“We started off thinking we were going to go with [SAP S/4HANA] on-premises, and now we’re going with RISE,” explained Gesink. “It just seemed like the logical answer. All the new innovations from SAP seem to be moving towards the cloud. We’re taking this big opportunity to transform our business, so it seemed a little counterintuitive to stay on an on-premises data center.”
Scrutinizing Every Letter
At Rich Products, one of the world's largest family-owned food companies, Corcoran is currently helping to lead a global ERP overhaul to re-platform nine regional ERPs onto a unified greenfield implementation of SAP S/4HANA. As part of that effort, he’s similarly focused on reducing customizations at Rich Products. “Anything we have to maintain on an on-going basis is customization, in our mind,” he said.
“We even put a level of scrutiny around reports,” added Corcoran, who also makes use of a RICEFW model to evaluate customizations. “For our existing system we just converted, we took 1300 reports and dropped it down to 250 reports that we’re going to deliver; most of those we’ll deliver through a self-service analytics model, so we don’t even have to maintain that going forward. I would absolutely recommend you scrutinize every letter of RICEFW, in order to keep that core clean, as intended by SAP.”
Of course, it’s unlikely for any organization to eliminate customizations and operate with fully standardized technology and processes. “The reality of the situation is, even if you are out-of-the-box and standard in your capabilities with SAP, you're integrating with some other systems in your ecosystem,” Corcoran said. “The key is to force those customizations as close to zero as possible.”
Corcoran has approached business transformation at Rich Products as an opportunity to reimagine its business operations, reduce its technical debt, and simplify and standardize its global technology, processes, and data. Corcoran referred to the company’s approach as “RISE lite,” given Rich Products’ combination of on-premises licenses taken to its own cloud, cloud-native applications (where required by SAP), and RISE with SAP via the SAP Digital Manufacturing cloud solution.
“There were meaningful differences in the capabilities between the on-prem version and the RISE delivery of that digital manufacturing cloud, which led us to make that choice,” he said. “We’re as hybrid as you could possibly get in this ecosystem.”
Adopting a Fit-to-Standard Model
For Nguyen, currently assisting an SAP utilities-industry customer with a brownfield SAP S/4HANA digital transformation that includes a state-of-the-art Active-Active Private Cloud supporting SAP S/4HANA Embedded Analytics and Intelligent Asset Management, it’s easy to see technology modernization as a “paradigm shift,” one that can transform an organization’s approach to integration, data management, AI, and other areas.
One of the most significant shifts, in his view, has been away from customization within a company’s core SAP ERP system and toward development in SAP BTP. “Two years ago, I used to think of BTP as a technical platform, and it’s not,” remarked Nguyen. “That’s part of it, but it’s a full development platform, with applications that can talk S/4.”
Nguyen encouraged attendees to “find a way to convince your business to adopt a fit-to-standard model,” stressing the importance of reducing customization within ERP systems and instead developing outside the core. “What SAP provides, use that, and adapt your business processes to fit the standard, so that you can go live successfully.”
Nguyen encouraged business leaders to explore the SAP Enterprise Support portfolio of asserts and services that are in place to help customers transform, adopt, integrate, and extend SAP solutions, as well as to consider support plans such as SAP ActiveAttention and SAP MaxAttention to facilitate cloud migrations.
People, Processes, and Technology
All of the customer speakers offered advice to attendees on what they should keep in mind before embarking on their SAP S/4HANA transformations.
- Build common processes: “Make sure your data is clean and accurate, and document your processes,” advised Gesink. To drive consistency and standardization throughout Steelcase’s transformation, the team instantiated global process leads and global process owners early on; given differences in processes across Steelcase’s three SAP ERP instances, this has been pivotal, he added.
- Define data owners: Corcoran told attendees to not only clearly define processes but to also define process owners upfront. “Do not make those decisions on the fly, during design sessions that will wreak havoc on your organization,” he said. “In same vein, define data owners. Creating new data structures, people are going to have to make choices around what data looks like in a harmonized state and make hard judgment calls on what we are leaving behind.”
- Invest in change management: Nguyen stressed the importance of change management for organizations exploring transformation. “Change management is not just about using the platform; it’s about system security, and authorizing our users,” he said.
- Engage with business leaders: Finally, Corcoran emphasized the need to establish a “pull” for the business to engage with technology transformation. “If you make this an IT project, you're going to fail, and you’re missing a huge opportunity for your organization,” he said. “We have spent a lot of time with our executive team, including senior leadership from finance and supply chain, showing them the value of SAP S/4HANA not only for today but for the future we’re creating.
For more from ASUG Tech Connect, read our coverage of the day-one, day-two, and day-three keynotes, exclusive ASUG research on SAP BTP, reflections from ASUG's Director of Content Strategy, an interview with Jabil's IT Director Cynthia Kendall on Jabil's S/4HANA migration, new columns by the Boring Enterprise Nerds and the SAP Customer Evolution team, an interview with enterprise architect Sylvain Garneau of Resolute Forest Products, and our pre-conference interview with SAP CTO Juergen Mueller.