Transitioning to SAP S/4HANA is no easy game. Embracing the new and innovative S/4HANA solution is a transformative journey that demands meticulous planning, execution and ongoing commitment. And the more complex your data landscape, the more resources, time and effort you might need to integrate. Considering these challenges, it’s crucial to streamline the migration process to maximize your investments in S/4HANA.
Why Data Remains Central to SAP Migration Initiatives
Recent research from UKISUG uncovers that nearly two-thirds of SAP users feel that data management is a challenge when moving from SAP ECC to SAP S/4HANA.1 Paul Cooper, chairman of UKISUG, goes on to say that data quality is also a crucial consideration, as organizations will fail to realize maximum value from implementing SAP S/4HANA if their existing data hasn’t been cleansed first.
Poor data quality can directly impact your business performance, bring cost inefficiencies, affect the performance of S/4HANA and even derail your whole modernization program. Executing business transactions and reporting using low-quality data in S/4HANA can result in inaccurate insights and diminish the value your business derives from the system. Bringing flawed data into S/4HANA requires additional time and resources for subsequent corrections. Increased system downtime contributes to decreased operational efficiency and the performance of S/4HANA, negatively impacting your business output.
Moreover, if you have inconsistent and inaccurate data in S/4HANA, you run the risk of non-compliance with local and global regulations. If you don’t fix these data issues at an early stage, they can result in hefty regulatory fines and reputational damage.
Getting Started with Your S/4HANA Migration
S/4HANA plays a pivotal role in your organization’s operational efficiency, as it handles business process workflows across multiple departments and functions within the enterprise. That means your implementation stakes are high. Ensuring a seamless data migration requires the amalgamation of proper tools and training resources. Additionally, you need a robust data strategy and the buy-in of your business stakeholders.
Depending on the complexity of your Enterprise Resource Planning (ERP) system, transformation to S/4HANA can be a multiyear journey, requiring implementation support from third-party service providers. The key to a successful migration journey hinges on assessing your various options early and ensuring their alignment with your business goals.
The Framework for a Swift S/4HANA Migration
Adopt a data-centric approach for your S/4HANA migration by leveraging the following four-step process, which sets the stage for a successful transition. However, it’s important to remember that each enterprise’s data landscape is unique. Consequently, while you should adhere to this straightforward four-step framework, you will need to tailor your migration approach to fit your specific needs and data environment.
The initial and pivotal step in your SAP migration process involves a comprehensive assessment of your data landscape. This entails scrutinizing data spread across diverse legacy systems and applications to ensure its readiness for migration.
The repercussions of flawed data often surface post-migration, derailing timelines and escalating costs. Hence, you should begin with data quality assessment and data management techniques that ensure data consistency.
To assist you with the data discovery process and ensure a smooth transition, follow this checklist:
- Evaluate the complexity of assets to be migrated.
- Prioritize data assets for migration.
- Archive data adhering to business policies.
- Ensure compliance with regulatory requirements for cloud-bound data.
- Mask personally identifiable information (PII) for controlled access.
- Categorize data sets for cohesive migration.
- Assess the scope of customizations.
- Determine migration approach based on the data evaluation.
- Gauge levels of data quality.
- Identify post-migration application integrations.
Consolidating data from various ERP systems is crucial for gaining a holistic view of your business operations, a key factor to help inform your decision-making and streamline your operations. This approach is especially vital in scenarios like mergers and acquisitions (M&A), customer relationship management (CRM) and retail analytics.
Addressing the complexity of multiple legacy SAP systems in M&A and CRM contexts requires extensive integration efforts across on-premises and cloud sources. Data integration presents an excellent opportunity to make the most of your S/4HANA investment by consolidating data from multiple ERP/CRM systems, moving them to S/4HANA and eliminating the cost of maintaining multiple legacy systems with limited support.
Let's delve into three key data integration scenarios that you may encounter during your S/4HANA journey.
- Replicating and integrating data into a cloud data lake or cloud data warehouse before migrating to S/4HANA: This is typical if you deploy dedicated data analytics platforms. In that case, you need to validate and execute your analytics and AI use cases, requiring the integration and migration of data across multiple channels to your analytics platform.
- Mastering data in a master data management (MDM) application before migrating to S/4HANA: SAP S/4HANA puts a high standard on master data. So as you embark on your S/4HANA journey, you likely will need to migrate and master your data in an MDM application before finally shifting your workloads to the new HANA platform.
- Connecting data across S/4HANA and your other line-of-business applications: Ideally, you are leveraging best of breed cloud applications. That means you will need to integrate both SAP and non-SAP applications like CRMs and human resource management (HRM) systems. This integration creates a seamless data flow among your heterogeneous applications and provides a comprehensive view of your business operations. Once your data is migrated and your S/4HANA implementation is near final, integrating these applications and democratizing your data becomes crucial to maximizing the value of S/4HANA investments.
The transition to S/4HANA involves a seismic shift in data models, moving away from traditional customer/vendor structures to a streamlined business partner model. But here's the catch: ensuring a smooth transition involves mapping your current data structures to fit into S/4HANA's framework. Picture this as a puzzle — understanding how your existing ERP data aligns with S/4HANA's entities and fields. Unveiling gaps or disparities is key, leading to strategic data transformations.
Now, here's where it gets interesting: data transformations, while crucial, often brew inconsistencies. You need to tackle these disparities before migrating from legacy systems to S/4HANA.
An MDM solution can tackle these inconsistencies, preserving data integrity and orchestrating a harmonious synchronization of your data and processes during the monumental leap to S/4HANA. Mastering your data domains prior to shifting your workloads to S/4HANA is key to a seamless, hiccup-free transition.
After investing considerable effort to ensure that your enterprise data is mastered and smoothly migrated to S/4HANA, governing your data on an ongoing basis will make a notable difference.
Data quality monitoring and observability tools can help you identify and remediate any data quality issues in S/4HANA and prevent inaccurate data from finding its way into other business applications. Alongside this, robust data governance policies are critical. They not only safeguard your data from unauthorized access and ensure that regulatory and compliance mandates are enforced but also play a significant role in S/4HANA. These policies facilitate the democratization of data across connected systems and applications.
However, data in S/4HANA is not exclusively for SAP users. Democratizing this data is essential for empowering business users, enabling data-driven decision-making and maximizing value for your stakeholders.
Consider creating a data marketplace, where your stakeholders can search for the data they need, collaborate with other users, request new data, monitor data usage and provide feedback on the data delivery experience. This feedback is invaluable for improving your overall data-sharing strategy.
Informatica leverages this four-step framework to deliver a seamless SAP modernization program with our AI-powered platform. The Intelligent Data Management Cloud (IDMC) is an end-to-end data management platform that offers key capabilities like data cataloging, data integration, master data management, data quality, data governance and much more, catering to the four key steps mentioned above.
Powered by the AI-engine, CLAIRE, IDMC provides a range of data management capabilities to help you innovate and succeed in your SAP modernization effort. Learn more about how to get started on your S/4HANA migration journey here: https://www.informatica.com/departments/sap-modernization.html