Switching the SAP ERP from ECC 620 to S/4Hana. Defining the criteria for Big bang or a dedicated process migration?

Tesis (Bachelor) , 2020 , 136 Páginas , Calificación: 1,0

Economía de las empresas - Administración de empresas, gestión, organización

SAP offers multiple ERP-systems in its product portfolio, which they have announced to change within the next ten years. Hence, any business currently applying SAP ERP products will need to migrate from ECC 620 to S/4Hana after 2030, to maintain its operating business. That migration is as complicated as it is complex, which means that companies are dependent on third-party consultations for its completion.

There are two main possibilities of how to implement such project. Through a big bang or a dedicated process migration. But what are the criteria for the different scenarios? Which factors determine the approach of the project? And more importantly, which business aspects should be prioritized to guarantee a successful implementation?

Max Brandenburg examines three approaches for a S/4Hana transition i.e. brownfield, greenfield, and landscape transformation. The author explains the concept of decision-making and change management, before evaluating and critically assessing a variety of implementation strategies. His findings are concluded in the Brandenburg Migration Check, which depicts company specific requirements, systematical requirements as well as motives and aims for the digital transformation to S/4Hana. Each factor and its strategic implications are defined. The findings are based on the experiences of different in-house as well as external consultants and are applicable to any kind of ERP change project.

Contents

AbstractII

List of Figures

List of Tables

1 Introduction
1.1 Research focus
1.2 Methodology

2 Theoretical Background
2.1 SAP
2.2 ERP
2.3 SAP ERP ECC 620
2.4 SAP S/4HANA.

3 Three scenarios of a S/4HANA implementation
3.1 Greenfield approach
3.2 Brownfield approach
3.3 Landscape transformation
3.4 Critique

4 Change Management
4.1 Decision-making
4.2 Digital Change
4.3 The change process by Kotter
4.4 Critique

5 Implementation Strategies
5.1 Big bang implementation
5.2 Dedicated implementation

B: Empirical Part

6 Methodological foundation and methodological approach
6.1 Overview: Study design
6.2 Survey method: expert interview.
6.3 Selection and contacting of interview partners: sample
6.4 Execution of the interviews and description of the interview situation
6.5 Securing the results and identification of the key messages
6.6 Evaluation and discussion of the data

7 Conclusion
7.1 Structure of the thesis and results
7.2 Answering the research question
7.3 Points of criticism and limitations of the own work
7.4 Conclusion and further proposals for another research

8 References

Appendix

Abstract

This work served to answer the research question: "When switching the SAP ERP from ECC 620 to S/4Hana: Defining the criteria for Big bang or a dedicated process migration?".

To begin with, the necessary theoretical background information is given. Including the definition of an ERP system, the company SAP, and its products. Followed by the scenarios of a S/4Hana implementation by the provider. Explaining the three approaches for a S/4Hana transition i.e. brownfield, greenfield, and landscape transformation.

The third section deals with the concept of decision-making and change management. Containing the exemplary structure of a change management process by Kotter with a subsequentially critique. Leading to the delta of Kotter’s concept, which is completed by the various implementation strategies by Eason, which are evaluated and adapted critically.

The final theoretical part emphasizes on the characteristics of the Big bang as well as the dedicated implementation strategy. The advantages and disadvantages are outlined and finalized in various hypotheses.

Ultimately, the gained theoretical knowledge of the S/4Hana approaches, change management, and the characteristics of the implementation strategies implied various hypotheses, which define the criteria for the Big bang or dedicated strategy. With the help of qualitative expert interviews, the following key findings were identified: The greater the personalization of the source system, the greater the cost of the S/4Hana transition. If the operating business is endangered throughout the transition, the system is introduced dedicatedly. The greater the congruency of functions, the more feasible a Big bang becomes.

List of Figures

Figure 1: Market share of ERP System Providers by Revenue

Figure 2: Development of SAP ERP Products

Figure 3: Three options of S/4Hana implementation

Figure 4: System Implementation Strategies

Figure 5: Initial dip phenomenon

Figure 6: Brandenburg Migration Check

List of Tables

Table 1: Types of Decisions

1 Introduction

The main aim for this work is to establish various criteria for any enterprise to serve as basis a for the decision whether to conduct a big bang or dedicated process migration in the ERP system change from ECC 620 to S4/HANA and to comprehensively depict the scope of such transition, including the standpoint of the system provider SAP. These criteria and the aspects of analysis are universal and serve both the software implementer i.e. IT-consultancy firms as well as the user of the software. The focus lies within the creation of a factor inventory, which provides a framework to discern a questionnaire for the consultant which to use when consulting the firm facing such a transitional issue. In particular, to provide the IT-consultancy firm “Actum Consulting Products GmbH” with an inventory, that delineates the importance of each factor as well as a provision of a framework to create a questionnaire for analyzing the client’s situation.

1.1 Research focus

SAP offers multiple ERP-systems in its product portfolio, both of which they have announced to change. Originally, SAP wanted to continue to offer support for all of its SAP ERP software until 2025, which they have recently extended to 2027 and until 2030 with the appliance of additional fees (cf. Frisch 2020). Any business that wants support from SAP will need to migrate to SAP’s flagship ERP software, S/4Hana. Meaning that 430.000 SAP customers are forced to upgrade their ERP system within the next 7 years in order to guarantee their ongoing operations as before (cf. SAP 2019). Therefore, if a fortification of the business processes fitting the digital age is wanted, enterprises have to decide whether they want to invest in the existing SAP purchasing solutions or give preference to other options. Bill McDermott, the former CEO of SAP, promoted S/4HANA at the presentation in February 2015 as its “biggest launch in 23 years, possibly ever”. This new ERP suite will run exclusively on SAP’s own database, Hana. Previously, SAP’s software worked with a number of databases, including Oracle, but businesses migrating to the new system will also need to migrate their entire database, meaning a transition of functionalities and large data sets from the one system into the other. In simple words, this process migration does not happen with one mouse click, but companies are dependent on third-party consultants to migrate this software (cf. Rouse 2017).

Many questions arise when realizing that such complication cannot be avoided. Do we really need a new system? Well yes, you do as we now know that your current system will no longer be maintained. Which systems will suit us best though? Is anything going to change when we implement this new system? How long will the implementation take? What implementation strategy is the most appropriate? And what effect will the new system have on the business ecosystem?

In order to answer these questions and to successfully prepare for such transition a situational, company-dependent framework needs to be established, to prove which factors determine the decision-making for the company itself, the management, and the software consultant.

Due to the reason that this phenomenon is predicted to cause various problems in many enterprises, the IT-consultant “Actum Consulting Products GmbH” and I have decided to dedicate my Bachelor thesis to this issue with the specific research on; when switching the SAP ERP from ECC 620 to S4/Hana: Defining the criteria for Big bang or a dedicated process migration?

1.2 Methodology

To answer the research question, the work was divided into a theoretical and an empirical part. In the beginning of the theoretical part the technical and industry dependent terminology will be explained thoroughly to give the reader a comprehensive introduction into the topic. This includes the company SAP SE, a definition and overview of ERP systems as well as the two systems that base the foundation for this work. ECC 620 and S/4HANA. Thereupon, the three-scenario framework of SAP SE will be presented and assessed. Furthermore, the term “decision-making” will be defined and the types of decisions presented. Moreover, the concept of “Change-management” will be explained on the basis of Kotter’s eight phases, which will be critically evaluated and completed through the addition of Ken Eason’s implementation strategies. On the basis of theoretical knowledge gained, hypotheses are developed, which are substantiated or refuted in the empirical part with the help of qualitative expert interviews. In the end, they are to be assembled in an inventory to form an answer to the research question. Finally, the findings of the work are summarized in an IT culture analysis inventory for the management of Actum Consulting Products GmbH.

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• Universidad: International School of Management, Hamburg Campus (ISM)
• Calificación: 1,0
• Autor: Max Brandenburg (Autor)
• Año de publicación: 2020
• Páginas: 136
• No. de catálogo: V937644
• ISBN (Ebook): 9783346296320
• ISBN (Libro): 9783346296337
• Idioma: Inglés
• Etiqueta: Change Management, Digitalization, SAP, ERP, Implementation Strategies, Migration Check, Analysis, Digital Transformation, S/4Hana, ECC 620, System, Award-winning, KPMG, Actum Consulting Products GmbH, Beiersdorf, T-Systems, digital change, business ecosystem, software consultation, IT culture, in-memory database, SAP Change, Big Bang, Phased Implementation, ERP System, IT Change management