Full speed ahead towards a digital future

A plethora of paths, forks in the road, and decisions to be made – anyone wanting to implement SAP S/4HANA first needs clarity about the many options available.

Before any implementation, the first step is to clarify the fundamental questions and find the best path to SAP S/4HANA. Is ‘green’, ‘brown’, or ‘hybrid’ the right path? Which operating model best suits your requirements? And does it make sense to transfer customer-specific developments to the new SAP S/4HANA landscape?

“Because the options are so diverse and the goals and starting situations of companies are so different, we always recommend that our customers conduct a preliminary study for SAP S/4HANA,” says Philipp Fischer, Project Manager at GAMBIT Consulting and project manager of the roadmap project.

“This preliminary study gives companies the clarity they need to subsequently implement a successful implementation project and, above all, to take full advantage of SAP S/4HANA in the long term,” says Philipp Fischer.

In 2020, the decision makers at thyssenkrupp Dynamic Components were also faced with the question of how best to master the migration to the new SAP software suite. Headquartered in Ilsenburg, the business unit produces drivetrain components for combustion, hybrid, and electric engines at ten locations worldwide

Like many other companies, the business unit had an established, heterogeneous SAP ECC system landscape with a large number of external systems. The company had multiple SAP ERP production systems in use, including in Europe, the USA, China, Mexico, and Brazil.

In March 2021, the company appointed GAMBIT Consulting to conduct a preliminary study for SAP S/4HANA, a GAMBIT SAP S/4HANA Full Scope Roadmap Program, to find the right path to SAP S/4HANA for its own requirements and goals.

The joint project kicked off at the beginning of April 2021 and was completed six months later in September.

Ina Hofstetter, Head of ITM ERP at thyssenkrupp Dynamic Components: “We wanted to use the preliminary study as a reliable basis for decision-making and to indicate the best path to SAP S/4HANA for us, including the possible use of SAP Best Practices and the planning of effort, costs, and project organization.”

“The strategic view was very important to us. With the transition to SAP S/4HANA, we wanted to simplify and standardize our processes, consolidate the system landscape, ensure greater flexibility, and harmonize our data, thus ensuring that we enjoy long-term benefits from the SAP S/4HANA migration,” Ms Hofstetter explains.

Three migration options to choose from

In the preliminary discussions, GAMBIT identified three possible migration approaches, which would then be analyzed and evaluated in the preliminary study:

• A ‘greenfield’ implementation (extended best practice version in line with the updated Five Golden Rules for Implementing SAP S/4HANA),
• A ‘brownfield’ system conversion for the three active production systems
• A hybrid conversion or selective migration, involving a system conversion of the European system plus a selective data migration from the other systems.

GAMBIT’s Roadmap program consists of consecutive steps that are designed to explore the different options. The results from the individual phases help a company’s management to make a reliable decision on the best path to take at the end of the preliminary study.

To this end, the program primarily answers the key questions of top management – about achieving strategic goals with SAP S/4HANA, for example, or minimizing risk when implementing a project of this kind.

The GAMBIT Roadmap program essentially follows the SAP Activate methodology; a standardized setup for implementing SAP S/4HANA more quickly and easily. GAMBIT has developed this methodology further to produce the GAMBIT Activate Plus process model.

The GAMBIT Roadmap program consists of six phases:

• Setting up the project and team
• Identifying, classifying, and processing the strategy and top management issues
• Target process mapping, translating into the SAP standard, and implementing guided walkthroughs on a demo system as well as conducting a technical assessment for a brownfield conversion
• Designing the target system landscape, calculating effort, internal and external costs, and risks
• Evaluating the project organization, change management, and individual variants
• Producing a final report in the form of an executive summary.

“This was also the procedure we followed at thyssenkrupp, covering every single aspect of the transition in detail,” explains Philipp Fischer, GAMBIT project manager for the preliminary study.

“In initial training sessions and workshops, we introduced all project members to central SAP S/4HANA topics to ensure that everyone involved had the same level of knowledge. Participants were given an overview of the contemporary structure of digital SAP architectures as well as an introduction to best practices in the fields of business administration and logistics.”

A live demo system was also provided at this early stage and prepared for system walkthroughs of the processes.

“Giving the customers access to a live system allows them to experience, try out and familiarize themselves with the system at a very early stage, something I consider essential in a project like this,” explains Philipp Fischer.

The SAP experts also conducted several strategy interviews with the management to record and take into account their strategic objectives.

The strategic objectives of top management identified in the interviews included, for example, the standardization of processes and greater user-friendliness when working with SAP.

A further important element of the GAMBIT Roadmap program is to gauge the degree to which the company’s processes are covered by the standard system, as this primarily determines whether the comprehensive use of SAP standard processes, and thus a ‘greenfield’, near-standard implementation approach, is recommended.

If coverage by the standard is very limited, for example, a greenfield implementation would not be generally recommended because the company’s individual requirements would not then be met. Conversely, a brownfield migration would not be advisable if the degree of coverage is already very high as this would fail to take advantage of the potential of standardization.

As part of the preliminary study, the GAMBIT experts assessed and ascertained not only the feasibility and suitability of the greenfield approach, but also the feasibility of system conversion and selective migration. They also prepared roadmap schedules for the various migration scenarios as well as robust resource and cost plans for all implementation options.

In the end, the GAMBIT consultants provided the decision makers with a final report containing all the information required to make an optimal decision about the migration path.

The company ultimately opted for an extended best-practice version of the greenfield implementation.

The reasons behind this decision were the high degree of coverage by best practices as well as the process harmonization possibilities and more flexible and leaner system architecture offered by this approach. The greenfield approach also promised a 100 percent fulfilment of the target objectives, which was much higher than the alternatives: system conversion and selective migration.

“The roadmap project was the perfect, targeted preparation for implementing SAP S4/HANA in our group of companies. The contribution of our partner GAMBIT was key in ensuring that we were able to meet our ambitious schedule,” concludes Ina Hofstetter from thyssenkrupp Dynamic Components.