SAP S/4HANA: What is it?

SAP S/4HANA: What is it?
SAP S/4HANA is the ERP system of the future. Learn about the possibilities that digital transformation can bring to your business!

Modern ERP system in the cloud

SAP S/4HANA (SAP Business Suite 4 HANA) is a cloud-based enterprise resource planning system that can analyze and process data in real time using the SAP HANA database. The range of capabilities offered includes marketing processes, accounting, procurement, planning, production, supply chain, sales, finance, and employee management.

The launch of the new solution was announced in 2015 by the company’s then-CEO Bill McDermott, who called it the most important product in SAP’s history. This is a significant change, as the previous version of the system was introduced in 1992.

What does the abbreviation SAP S/4HANA stand for?

  • Replacing the “R” with an “S” in the system’s name refers to the word “simple” and means simplifying the system itself, but also making it easier for developers to upgrade,
  • “4” stands for the next version of the system after R/1, R/2, and R/3,
  • HANA is the name of the database whose rethinking and redesign required changing more than 400 million lines of code.

One operating system. One database. One user interface

SAP S/4HANA takes connecting people, devices, and business networks as its primary goal. It combines the benefits of a traditional approach with the latest technological advances, such as machine learning, a simplified data model, simulations, or entirely new features, to achieve a higher level of automation and transparency in the organization.

SAP plans to phase out the older version of the ECC system by the end of 2027, so it makes sense to consider implementation or conversion now. Implementing this innovative solution is an excellent opportunity to rethink and redesign the organization’s processes to take full advantage of all the opportunities it offers.

Is SAP S/4HANA really an innovation for business?

The next-generation SAP system is designed to take advantage of capabilities previously unavailable in SAP ECC software, such as machine learning, Internet of Things (IoT), and real-time data analysis. It is also more modern, faster, and easier to use thanks to a simplified data model and leveraging knowledge from the area of user experience.

Learn about the four key differences between SAP ECC Business Suite and SAP S/4HANA.

Advanced SAP HANA in-memory platform

While previous versions of SAP software could run on a variety of platforms (DB2, Oracle, SQL Server, and SAP MaxDB), SAP S/4HANA is based on the advanced SAP HANA in-memory platform, allowing you to take full advantage of its capabilities. Thanks to the in-memory database, which stores data in RAM instead of a hard disk, as well as future technologies, simplified data architecture, and the elimination of indexes and summary tables, the system users can:

  • solve complex problems in real time,
  • avoid data redundancy,
  • reduce database size,
  • perform transactional processes and analyses simultaneously,
  • analyze large volumes of data in less time than in the previous version.

SAP customers have been able to use SAP HANA since 2011, so it is a fully completed and functional product that has already passed the testing phase and initial imperfections.

Optimize and automate processes – get your procedures in order

SAP’s innovative ERP is not only about new business capabilities, more computing power, new architecture, and more efficient data management, but also organizing and controlling processes and connecting departments in a meaningful and functional way.

Streamlining of business processes is possible thanks to ready-made scenarios implemented in the system, prepared on the basis of the knowledge of SAP specialists and experts from specific industries and sectors. The implementation of SAP S/4HANA can be a reason to take a broader view of business operations and reorganize them according to the new standard that has been proven and used by the largest and fastest-growing companies.

Modern look

SAP S/4HANA is equipped with the SAP Fiori user interface, which differs from the previous SAP GUI standard with a clear menu based on tiles. At the graphical and functional level, the latest SAP ERP system focuses on simplicity and ease of use, which directly translates into user comfort and reduces the time required for training.

The SAP Fiori interface also enables access to the SAP platform from any device (laptop, tablet, phone) and from any place. This enables faster access to information, better decision support based on up-to-date data, and timely notifications. Innovative software enables personalized experiences and work based on designated, specific roles to improve employee productivity.

SAP data center – no more relying on instinct

With tools like SAP Analytics Cloud, you have access to the latest data at your fingertips. SAP’s cloud-based analytics tool also means faster and more flexible reporting, so you can make critical decisions quickly and based on specific information. The software allows you to collect, process, and present data in an organized and transparent manner.

SAP Analytics shortens response times, and rapid decision-making is essential in times of crisis or in a dynamically changing market environment.

Benefits for different types of organizations. What are the business applications of the latest SAP ERP system?

SAP S/4HANA reorganizes the modules of the ECC system into Lines of Business (LoBs), which are digital cores tailored to the needs and requirements of individual industries, such as services, public sector, finance, natural resources and energy, and consumer. It allows the various departments of an organization to be connected in an orderly and beneficial manner.

Enterprise resource planning system for large corporations

SAP ERP works well in large and complex organizations, enabling the standardization of business processes in companies across the globe. At the same time, it gives them greater flexibility to respond to changing business needs, growing customer expectations, or dynamic market changes.

The new version of the SAP system includes the following LoBs:

  • S/4HANA Finance – manage all aspects of finance, including accounting, controlling, risk management, financial planning, and financial consolidation.
  • S/4HANA Logistics – a set of modules focused on supply chain and supplier relationship management processes.
  • S/4HANA Sales – focuses on the processes required to fulfill customer orders, including pricing, customer inquiries and quotes, completeness checks, repair and return orders, complaints, special requests, credit and debit requests, packaging, and invoicing.
  • S/4HANA R&D and Engineering – centered around the product lifecycle, including defining product structure and bills of materials, costing, project, portfolio, and innovation management, and health and safety compliance for sensitive materials and chemicals.

SAP S/4HANA implementations – when and how?

When migrating to SAP S/4HANA, you need to answer questions such as which approach is best for your organization (greenfield or brownfield), or whether a public or private cloud system is more appropriate. Drawing a conclusion from this depends largely on your organization’s current and target architecture.

Implementing an ERP system is always a challenge, but it is an investment that, if well planned, can provide a long-term financial return and significant benefits to the entire organization from the very beginning of the implementation, such as organizing processes within the company.

Earlier versions of SAP solutions were largely customized by customers and developed with the functionality needed for a specific company or industry. Many of these additional options are no longer needed when you migrate to SAP S/4HANA because they are already implemented in the standard release. For this reason, it is important to look at the processes within the company, map them, and see which ones can be best designed in SAP S/4HANA and eliminate the faulty, unused, or unnecessary ones.

In this case, it is worth using the Simplification List, which is a 1000-page document prepared by SAP that includes:

  • completely new functionalities,
  • options available in previous versions of the system and their improvements.

Despite its size, it is worth reading this document carefully in order to properly plan the configuration of the new solution and understand its capabilities in relation to the ECC version.


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