What is SAP S/4HANA?

The latest ERP suite from SAP

SAP S/4HANA is ERP software from Walldorf-based SAP SE that enables companies to cover and control their daily processes - from marketing to accounting, from logistics to human resources to procurement.

Companies can run SAP S/4HANA on-premise (in an on-site data center) or in the cloud (IT infrastructure of a service provider via the Internet).

Experts refer to the product as a "real-time ERP suite" because, as an ERP system, it can analyze and process information and data in real time.

Since 2014, customers have already been able to use simplifications in the area of finance and accounting as SAP S/4HANA Finance. SAP S/4HANA has been available since November 2015.

What does the name SAP S/4HANA mean?

SAP S/4HANA is an abbreviation and is made up of various parts:

• "HANA" stands for the SAP HANA database, on which SAP S/4HANA is based.
• The number "4" stands - after SAP R/1, SAP R/2 and SAP R/3 - for the fourth major ERP software innovation from SAP.
• The change from "R" to "S" stands for the great leap in development that SAP has made with SAP S/4HAN - towards even more simplicity ("Simple").

What is the HANA database?

The basis for the SAP S/4HANA software is SAP HANA, an in-memory database. In-memory means that the main memory is used as data storage. This leads to a significantly higher speed of data processing.

SAP's previous ERP systems could also work with non-company databases (e.g. from Oracle, IBM or Microsoft) - this is now no longer possible with SAP S/4HANA.

Although SAP S/4HANA was developed completely from scratch, the software is basically based on the data model of its predecessor, SAP ERP. However, SAP has radically simplified this data model.

The advantage of compatibility with the conventional ERP system is that SAP S/4HANA does not necessarily have to be re-implemented.

What is the "digital core" of SAP S/4HANA?

The digital core is the heart of SAP S/4HANA. "Consistently realizing a digitization-friendly IT environment" - that is precisely what is meant by the digital core, according to SAP.

The core networks all applications with each other and thus enables the use of data "without loss of information throughout the entire company" - and in real time.

The reason for this lies in the architecture: Unlike SAP ERP 6.0 (OLTP and OLAP as separate systems, programmed indexes, aggregates, etc.), the information is now no longer row-based, but in columns.

The advantage: a column-based database can perform analyses and processes much faster (in real time) because the need for indexes and aggregates is eliminated.

The central functions for companies are located in the core; all other functions are located outside the core as separate business unit solutions. These solutions can be integrated as needed.

What is SAP Fiori?

With SAP Fiori, SAP S/4HANA has a new user interface (UI) that is similar to traditional consumer apps.

Among the advantages of SAP Fiori is that it can be personalized and is user-friendly and convenient to use.

The UI works in a role-based manner (the right information is available at the right time via different user interfaces) and can be used both with a desktop PC and mobile with a smartphone or tablet.

Will the previous ERP system have to be switched off when SAP S/4HANA goes live?

Companies can continue operating their classic ERP systems until the end of 2027. Mainstream maintenance for the Business Suite 7 (including SAP ECC) will end on that date. However, optional and paid extended maintenance will still be available until the end of 2030. No additional license fees will be charged until the end of 2030. The go-live of SAP S/4HANA does not change this: companies may choose to run their existing ERP systems in parallel with SAP S/4HANA. If issues arise with SAP S/4HANA, the legacy ERP system can even serve as a fallback option, helping to prevent operational disruptions.

Although SAP S/4HANA was developed from scratch, its software is fundamentally based on the data model of the previous SAP ERP system. However, SAP has significantly simplified this data model. The benefit of this compatibility with the traditional ERP system is that a complete new implementation of SAP S/4HANA (“greenfield”) is not necessarily required. Companies can also opt for a transformation of their existing SAP ERP system to SAP S/4HANA (“brownfield”) or even consolidate multiple ERP systems (formerly called “landscape transformation,” now known as “selective data transition”).

SAP S/4HANA features SAP Fiori as its user interface, which resembles consumer-grade apps. The advantages of SAP Fiori include personalization, user-friendliness, and ease of use. It is role-based, meaning the right information is available at the right time across different interfaces, and it can be used both on desktop computers and mobile devices such as smartphones or tablets.