The Digital Core

PUBLIC
• What if IT did more than just “keep
the lights on”?

• What if IT was the catalyst for

innovation?

• What if the IT department led the

transition to the digital core?

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Part 1: How does SAP S/4HANA Make the Digital Core a Reality?
How SAP S/4HANA Makes the Digital Core Real

Improved user New business capability

Simpler data model + experience = Improved productivity

Complete, consistent choice of environment

Common themes
All improvements and capabilities in SAP
• Unification of disparate data sources
S/4HANA can be explained by at least
one component of this formula • Drill down to detail
• Landscape consolidation

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 Simpler
What Does it Mean to Simplify? Data Model

An Analogy: Sending a Photograph to Someone Far Away

Camera Film Darkroom Paper Postal Service Recipient Complicated and with enormous
resource expenditure. Individual
components were eventually
sped-up to get the end-to-end
process to one day minimum.

“Camera” Internet Recipient Not merely faster—the

“architecture” is reduced. As a
result, the process happens
instantly and can be done any
time and in different ways for a
fraction of the cost.

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 Simpler
Simpler Data Model: Inventory Management Example Data Model

Traditional disk-based ERP In-memory ERP

Aggregates History Document

MSTQ MSLB MSTQH MSLBH MKPF

On the fly aggregation

MSTE MSKU MSTEH MSKUH MSEG

Inventory movements
MSTB MSKA MSTBH MSKAH

Material Master MATDOC

MSSQ MKOL MSSQH MKOLH Master data with Material Document
Stock aggregates

MSSA MCHB MSSAH MCHBH

MARC MARD
Master data without Stock aggregates
MSPR MSPRH MARDH

MARC MARD
MARCH MARDH
MARCH
Master Transactional 26 aggregate
data data tables

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 Simpler
Simpler Data Model Impact Data Model

Technology
• No aggregates or redundant data
• No locking
• Full granularity for all processes

Capability
• Operations in real time
• Elimination of data reconciliation
• More precision
• Basis for simulations and predictions

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 Improved
A Digital Interface for a Digital World User Experience

From the Past… …To the Present

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 New
Example: Soft Financial Close Anytime Capabilities

With Traditional System Close

batches
Consolidation
batches
With SAP S/4HANA

Reporting on demand

Initial period Close and consolidation Initial period Close and consolidation

With Traditional System With SAP S/4HANA

 Close activities that don’t begin until period end  Real-time system with key performance indicators (KPIs)
User
 Multiple batch-run dependencies Ad Hoc instantly refreshed
Interaction
 Batch bottlenecks that delay downstream activities  Elimination of end-of-period batch bottlenecks
 High error-correction efforts  Continuous intercompany reconciliation
Traditional With SAP S/4HANA
 Complex issues that are postponed until after close  Continuous financial reporting visibility
 Time-pressured resolutions  Profitability analysis and line-item detail reconciliation
 Delayed visibility into reporting Process Excellence  Automation for routine tasks
 Full management visibility of close tasks

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 New
Example: Post Goods Issue (PGI) Capabilities

Business Challenges
• The client’s facilities run 24/7 including high-volume, small lot size shipping transactions
• Materials are shared across plants and multiple shipments are frequently executed in parallel
• Experiencing instances where PGI failed because the material data (batch stock) was locked:
• Goods movement is posted
• Quantity on hand is updated in aggregation tables
• Delays trying to post goods issue while the truck driver is waiting

Resolution in ECC 6.0

• Repeat attempts to post PGI until there is no lock
• Reschedule background jobs for PGI
• Rethink batch strategy for materials
• Identify SAP Basic changes to reduce number of locks

Resolution in SAP S/4HANA

The Batch Stock tables no longer exist. Only the material movement needs to be created without regard for the
actual stock level.
Transactions can be run in parallel without table locks.

Reduced transaction No carrier Reduced risk of users

processing time detention fees working around the system

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 New
Reduced IT Complexity Capabilities

Impact on IT Landscapes
• Reduced storage
• Less replication
• Less network load
• Faster restart after failover

Example with Finance data

Traditional DB on HANA S/4HANA Current

593 GB
118.6 GB
42.4 GB
8.4 GB

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 New
Landscape Consolidation Example Capabilities

Sales and Service Supply Chain Sourcing

Use in slide show mode for animation

Commerce Planning Procurement BW

Operational
Reporting
Customer Execution SRM

ERP

SAP HANA
Legacy Platform
RDBMS

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 New
Industry Solutions Consolidation Capabilities

ERP ERP

Discrete Industries Retail Discrete Industries Retail

Legacy RDBMS Legacy RDBMS SAP HANA

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SAP S/4HANA 1709 Update (released September, 2017)
Key Innovations

Embedded Transportation Management Manufacturing Manufacturing

- Basic Shipping and Data Harmonization - Demand Driven Manufacturing - Engineering Cockpit
- Integration in extended warehouse mgmt. - Advance Variant Configuration - Extension for Complex Assembly Industries

Consumer Products Industry Finance Quality Management

- Machine Learning with SAP Cash Application - Manage usage decisions
- Catch Weight Management
- Analytics for quantitative results

Commodity Management Procurement Extended Warehouse Management

- Extending pricing - Centralized purchase requisitions - advanced Labor Management
- Machine Learning for Contract Consumption - Pallet Planning

Industry to Core
Enterprise Asset Management PLM
Retail / Wholesale - Report and Repair Malfunction
- Wholesale Fashion enablement - Visual Enterprise Generator Conversion
- Breakdown Analysis - Recipe Management and Recipe finder
- Order allocation
- Segmentation

Service Core (CRM Add-On)* -

Sales
- Migrate installed base CRM Maximize SAP Fiori Experience
- Electronic payments with Payment Hub
- Eliminated middleware - SAP Fiori Overview Pages
- Harmonized data models

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New innovations Existing & enhanced innovations
* First delivery planned with SAP S/4HANA 1709 FPS01 in 2018
Part 2: How Do I Plan for SAP S/4HANA Adoption?
SAP S/4HANA Deployment Strategy Overview
Items marked with * can be started immediately

Prepare users and systems Determine the transition path

• Readiness Check* • Greenfield (new implementation)
• Business Value Advisor* • Brownfield (conversion)
• Prototypes* • Landscape transformation

Adapt custom code Choose deployment destination

• Assess custom code inventory* • On premise
• Address inefficiencies* • Cloud
• Adapt code to S/4HANA • Hybrid/multi-tier

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Your Personalized Journey to SAP S/4HANA
Free, self-service guidance you can get today for IT and the line-of-business

1. Build Your Business Case: 2. Discover Your Destination: 3. Plan Your Move:
S/4HANA Business Scenario SAP Transformation SAP Readiness
Recommendations Navigator Check

Identify the business processes See the S/4HANA roadmap for Learn the technical requirements
you can improve and discover new each component in your current and actions for a system
business capabilities. (link) landscape. (link) conversion to S/4HANA. (link)

Customers new to SAP can use Based on current SAP product usage or Based on configuration and usage data for
Business Value Advisor. (link) capabilities your organization wants. customers already on SAP ECC 6.x.
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SAP S/4HANA Adoption Paths

EXAMPLE:
On-Premise
New Non-SAP New or existing SAP Customer
Implementation ERP System implementing a new SAP S/4HANA
S/4HANA Cloud system with initial data load

EXAMPLE:
System ERP System On-Premise
Conversion Complete conversion of an existing
SAP S/4HANA SAP Business Suite system or selective

ERP System
Region A On-Premise
EXAMPLE:
Landscape ERP System
Transformation Region B Central Finance
ERP System S/4HANA Cloud
Region C

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SAP S/4HANA: Complete, Consistent Choice

SAP S/4HANA’s code line, simplified data model, and modern user SAP S/4HANA
experience are consistent for both cloud and on premise. Designed
for in-memory, SAP S/4HANA brings new business capability while
simplifying the IT landscape.

Considerations for selecting the right SAP S/4HANA

solution:
 Business functionality
 Regulatory, industry, and regional requirements
 Individualization options
 IT Strategy
 Innovation cycles
 Adoption/upgrade efforts
Cloud On Premise
 TCO
 Commercial models

One Code Line

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The Right Solution for Each Customer Situation

Cloud ERP

SAP S/4HANA Cloud,

SAP S/4HANA Cloud SAP S/4HANA
private editions
On-premise capabilities
SaaS solution Private cloud managed by customers
 Configurable standardized processes and best  All private editions run on  On-premise functional scope
practices for finance, procurement, HR, and sales SAP HANA Enterprise Cloud  All industries supported
 In-depth support for professional services and  Customizable packages and bundles  Customize, modify, and extend
component manufacturing with more industries  All industries supported
on roadmap  Customer infrastructure or IaaS
 Extensibility with PaaS
 Extensibility with PaaS  Annual release cycle, speed of adoption
 SAP-managed services on private cloud depending on configuration and custom
 Public cloud infrastructure infrastructure (SAP, AWS, Microsoft Azure, modifications
 Quarterly release cycle Google Cloud Platform)
 Best-in-class deployment/upgrade efforts
 Lowest TCO  Annual release cycle, speed of adoption for on-premise ERP
depending on configuration
 Fastest time to value  Perpetual licensing
 Low deployment/maintenance/upgrade
 Subscription licensing
efforts vs on-premise ERP
 Subscription licensing

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Easing the Transition

What Happens to My Customizations Fiori Shell

with the Simplified Data Model? Fiori Apps, Design Studio
Search
ALV (U15) Analysis App

Backward compatibility
• Core Data Services OData R InA R InA R

• SAP GUI
SAP S/4HANA Gateway

Leveraging new capability ABAP

R R

• Simplification DB Transactional Logic Analytic Engine (Enterprise-)Search

• Key User Extensibility
R R R

Core Data Services View

HANA

Suite Tables

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Major Milestones in SAP S/4HANA Adoption

PREPARE EXPLORE REALIZE / DEPLOY

All Implementation Dependent on Migrate Existing

Scenarios Implementation
Scenarios
System Conversion
Technology driven migration offering

Strategy &
Roadmap
Landscape Transformation Implement new
Implement
Value Discovery Business driven migration offerings
Innovations
additional industry
Workshop Installation and data
Technical / LOB packages
transition for SAP
Architecture
& Migration
Planning New Install

New Implementation
S/4HANA on premise and cloud

Leverage SAP Digital Business Services or Partner Ecosystem

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How Can I Learn More?
www.sap.com/s4next
Thank you.
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