From the time when SAP founders Klaus Tschira, Hasso Plattner, Dietmar Hopp, and Hans-Werner Hector first introduced SAP in 1972, SAP has arguably offered the best ERP available. It has certainly contributed to changing and improving the way that the best performing companies are managed today. Many businesses that use SAP could not effectively operate without it. SAP has delivered countless benefits to companies, but these benefits have not have come without a significant price tag. One thing that you can comfortably say about SAP is, nothing about SAP comes cheaply! So with the news that SAP has set a December 31, 2025 deadline, after which its ERP system will be built to run on just one single database platform; SAP’s own HANA; should have many CIOs, CFOs and CEOs quaking in the boots at the potential cost of moving to the new system. SAP describes S/4HANA as the “biggest launch in 23 years, if not in the entire history of the company”.
S/4HANA only runs on Linux, so there are several potentially significant technical matters to consider, including whether to deploy in private, public or hybrid clouds.
After December 31, 2025, SAP R/3 customers will no longer receive any updates or support from SAP to resolve technical issues. However, customers will have the option to stay with R/3 and switch their support to Third party support vendors.
While there is no need to panic, 2025 is a real deadline. Smaller businesses may be able to wait a couple of years to decide, but larger enterprises really need to start planning now.
There are a few different options available to businesses:
- Stay with R/3 and establish an alternative third-party support arrangement.
- Move from R/3 to S/4HANA
- Move to a new ERP provider, such as Oracle, Microsoft or Workday
If your current SAP implementation does not have much in the way of customization, then it may be possible to migrate to S/4HANA. However, a lot of customizations will almost certainly require a full re-implementation. The word on the street from some of the leading systems integration companies, is that the most successful implementations of S/4HANA to date, have been those that have essentially been a complete re-implementation. This is largely because the underlying database schema is massively redesigned in S/4HANA.
Whichever option you decide to take, dealing with your existing data in R/3 is going to be one of the biggest challenges to overcome. There are solutions available, like QueBIT’s Atlas for SAP, that can really help with this universal business problem, while also allowing existing SAP customers to achieve a lot more value from their existing R/3 implementations in the interim. More on this below.
What is so special about S/4HANA?
SAP S/4HANA has a unique architecture that is fundamentally different to the classic R/3 relational database. S/4HANA runs in-memory, with data stored in columns, allowing for near real-time analytics and much faster compute capabilities. The following benefits are typically noted:
Ease of use. SAP Fiori 2.0, which is the latest SAP UI, provides a much more modern experience for users, with easy access to everything that a user would need. Designed with personalization in mind, the new UI supports a vision for users interacting with the data in SAP, to gain relevant insights and support real-time decision making.
Increased performance. S/4HANA provides much greater performance and better service for customer-centric applications.
Simplification. S/4HANA delivers significant simplification to the management and administration of the overall system, including, centralization of hardware and network resources, and the harnessing of the HANA in-memory database to avoid the need for things like multiple batch-run dependencies and aggregate tables. The belief is that this will reduce overall processing time, and this will enable organizations to invest more human time on strategic growth efforts.
Cost effectiveness. One of the primary ideas around adopting HANA as the platform, is that companies can achieve significant cost efficiencies by bringing together all the analytical and transactional processing capabilities into one solution. This would have a significant beneficial impact on decision making but the jury is still out on whether this is a truly realistic goal in practice. It would imply that all data needed for analytics and decision making was accessible from S/4HANA and that may not be realistic in practice for many organizations.
Easy transition to cloud. S/4HANA offers easy transition from on-premises to the cloud and a decision on this can be made at any time, typically reducing costs. This is therefore an important benefit to consider.
It’s all about the Analytics Right?
It is true that arguably the biggest benefit of S/4HANA is the convergence of transactional processing and analytics into a single solution. R/3 customers today know all too well about the challenges of trying to use data from R/3 for the purposes of analytics. Many SAP customers use SAP’s Business Warehouse for this, but few implementations of BW fully address the needs of the enterprise from all the different SAP R/3 modules. There is also the issue of data from other systems that never makes it into BW (e.g. Non SAP planning, consolidations, HR and CRM systems). To address this problem, many organizations have built their own custom data warehouses, for the purposes of universal analytics and related decision making. Getting data out of SAP is not for the faint-hearted and the complexity involved is abound. Firstly, there are multiple modules to deal with, each serving the needs of different parts of the enterprise, and each module comprises hundreds and sometimes thousands of relational tables, all written in German. Here is a list of the main modules in SAP:
- Financial Accounting (FI)
- Controlling (CO)
- Sales and Distribution (SD)
- Materials Management (MM)
- Production Planning (PP)
- Quality Management (QM)
- Plant Maintenance (PM)
- Customer Services (CS)
- Project System (PS)
- Human Capital Management (HCM)
The traditional way to get data out of the various SAP Modules has been to write ABAP programs. SAP in general has been a rather closed system, even in the more recent versions, and ABAP has provided a way to work through this closeness. However, ABAP is rather complex, and it suffers from not having full SQL92 language support. This in turn has resulted in the need to build complex and time consuming ETL processes to deliver data to the data warehouse.
Even with all these challenges overcome, loading data from SAP to a data warehouse has traditionally presented a common problem for database administrators: how to balance the needs of the SAP transaction processors, with the need to get access to data quickly for analytics and decision-making purposes? There is often a lot of data involved, so BULK SELECTS are typically preferred to speed things up for the data warehouse ETL processes. However, as soon as you BULK SELECT on a database table, all other requests fall behind the BULK SELECT until it has finished processing. The reality is that loading data from SAP to a data warehouse, slows down transaction processing in SAP. This may push the data warehouse ETL processes to being run outside of normal business hours. This however delays the availability of the data for analytical decision-making purposes. Database administrators have tried to work around this problem by trying to use clever incremental load techniques, that only take a few, or partial records at a time. The problem with this is one of accuracy on the Analytics side of the house. Pulling whole records, from all the joined tables, is the only way to ensure complete data integrity. This takes us right back to the first problem of impacting the performance of transaction processing in SAP.
Atlas for SAP
What if there was a way to load data from SAP at any desired frequency, and not impact transaction processing performance? Enter Atlas for SAP from QueBIT.
Atlas leverages a proprietary Highly Optimized Performance Extraction (HOPE) process, that addresses enterprise SAP system performance holistically. Using mathematical modeling based on operations research queueing theory, Atlas optimizes and balances the available systems resources to avoid any impact on the source SAP ERP systems, while data extraction is taking place. By injecting wait time algorithms into the process, Atlas can achieve optimized incremental loads, while still extracting whole document records, which avoids the common errors that can occur with incremental load processes. The uniquely designed HOPE extraction process achieves optimized overall Enterprise system performance, in the most stable and accurate way possible.
SAP’s own analytics solutions, like Business Warehouse, tend to be hard wired to SAP. Atlas adopts a “loosely bound” approach that enables easy extraction and transformation from any source system, that also requires minimal implementation time to adapt and change. This provides freedom to decide when to migrate to SAP S/4HANA, or indeed to any another ERP system.
For any company that doesn’t already have a data warehouse for its SAP data, Atlas also optionally delivers a complete data analytics and BI solution out of the box. Customers can choose to implement on a Modular basis, for each of the SAP Modules.
Making the decision to switch from SAP R/3 to SAP S/4HANA will not be an easy one. It will require a lot of thought and careful planning. You may ultimately decide to take this journey, or you may not. Whichever path you decide to take, you will want to make the most of what you already have today. You will also want to ensure that the path that you take, can be implemented in the most efficient and effective way possible. A solution like Atlas for SAP from QueBIT can really make the difference between the journey of a lifetime, and the migration project from hell. Given that the top systems integrations firms are finding that fresh implementations of S/4HANA are generally more successful than migrations from R/3, you may ultimately be best served by doing just this, and warehousing your R/3 data, leveraging a solution like Atlas to make this a far more efficient and effective reality.
Want to learn more? Join us on March 14th for an in-depth dive into ATLAS for details on functionality, implementations, and licensing. Sign up today!