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August 8, 2021 | Matt Pacheco

How SAP S/4HANA Fuels ERP Digital Transformation

ERP Digital Transformation: The missing link

These days, enterprise resource planning (ERP) systems are so common it’s hard to imagine doing business without one. Since ERP software applications are such a foundational part of the enterprise business model, many organizations keep the same core ERP system for decades. 

Yet, change is a fact of life in as more businesses operations evolve and implement digital transformation initiatives. In fact, in a recent survey published by CIO.com, 77% of respondents ranked digital transformation as their top priority. 

Unfortunately, many organizations struggle to achieve their vision and outcomes for digital transformation. A primary reason for this is the failure to connect the foundational technology the business uses – the existing ERP system – to these digital transformation goals. This failure can be due to lack of vision on the part of business and IT leaders, and ERP vendors not keeping up with advances in technology. 

SAP is one ERP vendor that understands this. The premier integrated ERP management system for the enterprise, SAP S/4HANA, is designed with digital transformation in mind. In this post, we’ll focus on five ways SAP S/4HANA improves digital transformation and ERP implementation. 

78% of IT decision-makers agree that the collection and analysis of data has the potential to fundamentally change the way their company does business over the next 1-3 years. 2021 IDG Data & Analytics Study 

Transforming your business with data

Digital transformation targets are as unique as the organizations that set them. However, these goals all have one underlying characteristic in common. Reaching them requires access to clean, current, and reliable data. For example, a manufacturer might implement IoT devices on the factory floor to collect more data for better visibility and faster throughput. 

The advanced analytics engine implemented by a major bank is only as good as the data it has available to analyze. The automation systems implemented in a distributor’s warehouse require data to drive their actions. 

For years, organizations have talked about leveraging big data to make smarter decisions faster and automate repetitive, time-consuming, and error-prone tasks. Yet, even as the data enterprises have access to increases exponentially, many struggle to make use of it. According to Forrester, as much as 73% of data collected by enterprises remains unexploited. 

SAP S/4HANA was designed with digital transformation and big data in mind. Powered by HANA, SAP’s revolutionary in-memory database, S/4HANA, forms the digital core of the enterprise. S/4HANA also delivers several key enhancements that help drive digital transformation. What is SAP S/4HANA and how do I migrate? 

Simplified architecture

One of the primary challenges with many ERP systems is the redundant and outdated code that makes maintaining the system and integrating third-party applications a challenge. SAP has simplified the underlying code and architecture for SAP S/4HANA, removing these redundancies and extraneous code remnants. This creates an ERP solution that is easier and more cost-effective to manage and maintain. 

More data from more sources

The SAP Business Suite itself includes a wide array of industry-specific capabilities. Other SAP best-of-breed solutions can be added to provide even richer functionality and fuel the data analytics engine. 

Faster data processing

In-memory databases store data in the system’s random-access memory. This creates significant performance benefits for processes that take serious computing power, like: 

  • material requirements planning (MRP) 
  • supply chain optimization 
  • inventory management 
  • data analytics 

Advanced analytics, AI, and machine learning

S/4HANA leverages the advanced analytics and machine learning/AI algorithms built into SAP HANA. Other SAP Analytics solutions can also be tightly integrated, including: 

  • cloud-based SAP Analytics 
  • SAP Data Warehouse Cloud
  • and SAP BW/4HANA 

These integrations offer greater insights leveraging a wider array of data sources, including those outside the SAP digital core. 

Accessible insights

SAP S/4HANA takes advantage of SAP Fiori, SAP’s browser-based interface designed to be used across many of the company’s solutions, including ECC. SAP has created hundreds of business-role templates in Fiori, streamlined and improved the user experience across many types of devices, and provided more accessible insights for users. 

Automation

In a survey conducted by the Association for Intelligent Information Management (AIIM), 75% of respondents said they view process automation as “important” or “very important” to their organization. In 2018, SAP set a goal of automating at least 50% of all ERP business processes within the next three years. 

In 2021, they’ve surpassed that goal, empowering enterprises to improve efficiency by automating more than two-thirds of their business processes in SAP S/4HANA Cloud. 

Also read: Top 5 SAP ERP Challenges for IT Organizations 

Introducing Managed SAP S/4HANA Private Cloud

SAP offers S/4HANA in both on-premises and cloud versions. For many organizations, migrating workloads to the cloud is a fundamental component of their digital transformation and business strategy. However, not every enterprise will be comfortable assigning responsibility for their applications and environment to SAP. 

For those organizations looking for the greatest control and flexibility, TierPoint offers Managed SAP S/4HANA. This innovative and comprehensive solution for the modern enterprise combines a best-in-class, high-availability private cloud platform with a team of SAP Managed Cloud experts. 

Learn more about our Managed SAP S/4HANA and watch our video podcast interview on SAP S/4HANA. When you choose Managed SAP S/4HANA, your applications and data will be housed on dedicated resources in one of our data centers. 

Each of our data centers undergoes annual compliance audits for NIST, HIPAA, PCI-DSS, GLBA, SOC 1, and SOC 2 certifications. In the latest round of audits, every TierPoint data center met SSAE 18 standards for SOC 1 Type II, SOC 2 Type II, and SOC 2 + HITRUST certification. TierPoint is also ITAR and EU-US Privacy Shield registered. 

Leapfrog ahead on your digital transformation journey

Chances are, your digital transformation journey began months, if not years, ago. Hopefully, you’ve already seen a return from your investment. If you’re like most business or IT leaders, though, you’re always looking for that next game-changer. A Managed SAP S/4HANA solution can help you achieve your digital goals. 

Reach out to us to see how SAP ERP and digital transformation can help you leapfrog ahead on your journey. 

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