S/4HANA: evolution or revolution?
One thing is clear: S/4HANA is the SAP’s “next big thing”. However, this appears to be the only clear thing as surprisingly many other aspects are very much unclear, vague, and confusing. At least for SAP customers. One would expect that SAP would want to have a clear and simple communication towards the existing, large, and trusting customer base as well as to the partner community.
Yet, depending on the occasion, the audience, and the speaker, SAP representatives share different (sometimes contradicting) information. Of course, SAP has a clear roadmap and plan in mind. Simplified Finance speaks for itself. Even if it lacks a game-changer momentum, it is a clear move in the right way and may be an evolutionary step towards the true revolution with further improvements in logistics.
Spreading the word on this plan seems to be the problem.
Is it true that S/4HANA customers do not need SAP BW anymore?
A major question in this context is the confusing message that customers running on S/4HANA will not need the good old SAP Business Warehouse any more.
A lot of the confusion seems to be rooted in the statement of some SAP sales representatives who are looking for ways to convince customers that S/4 is the best thing since bread comes sliced. Personally, I have recently heard multiple statements from SAP customers such as “you can discontinue your BW and this simplifies the landscape and and and…”. This was during the last months: late in 2015 and early in 2016. When asked where they heard this, they often pointed to their SAP client partners as source for the reference. Probably there are simply not enough good USPs to position S/4 with only SFIN and Fiori at this time yet.
The situation has gone so far that even on SCN, SAP’s Juergen Butsmann (and some colleagues in other posts) strived to clarify the matter (see link below, and much thanks Juergen for a very comprehensive and helpful post to clarify the roadmap!).
I’m sure it must be no fun being a SAP sales rep and having to push S/4. Overall, I firmly believe that S/4 is the way to go. Clearly, taking ERP on HANA to the next level is a smart move for many reasons (including technical and roadmap reasons). Whether the time is right for that move for particular customers already today may be another question of course.
In the end, will S/4 replace SAP BW?
At Datavard, we are convinced that S/4 is not the BW killer. Of course, ERP reports such as stock lists, LIS, CO-PA, and ABAP Query may run much faster than on any other legacy database. However, this does not replace a true Business Warehouse.
There are several good reasons for that:
- The purpose of a Business Warehouse is not only reporting itself – but also ETL (Extraction, Transformation, Loading) and data warehousing. Multiple ERP systems, CRM, SRM, and other systems, including non-SAP systems, often feed data into a single BW environment. How would a single S/4 system replace all that? (This is a purely rhetoric question – it cannot)
- SAP customers have invested heavily into their BW implementations. There is a lot of implementation effort and business knowledge which was poured into existing solutions. Reporting is often highly process and scenario dependent. Even if S/4 could simply replace all this (which it cannot!), this would entail high implementation costs and efforts to devise reporting solutions to replace SAP BW. Claiming that S/4 could simply replace the existing SAP BW implementation is, in my opinion, disrespectful to the efforts and costs poured into existing implementations.
- One could argue that SAP BW could be used from within S/4. After all, BW is part of SAP Netweaver, and could theoretically be used within any SAP installation. Still, this does not “kill” BW. Running a combined BW and ERP installation worked in the past for only few (and small) SAP customers due to many factors (such as software logistics, overall TCO, flexibility, upgrade and EHP cycles, etc.).
We are convinced that S/4 will be the way to go with regards to ERP. For reporting, this will help with ERP-centric reports such as cost center or profit center reporting, which can easily be done within the S/4 environment. As reporting platform in general (including data warehousing), we believe that SAP BW on HANA is the way to go (or – for many customers – stay).
There are several sources confirming our findings – apart from our own experience with S/4 and Datavard’s customers. The German SAP User Group (DSAG) is one of them. Also, Computerwoche and the E3 magazine published articles on S/4 and the “BW myth” in (e.g. E3 in their January 2016 edition), confirming our point of view. Even SAP itself on SCN The DSAG created a positional paper which states that SAP BW will live on as an extended Enterprise Data Warehouse, facilitating the use of Big Data applications.
What we see is that in the SAP ecosystem, Hadoop will play a more and more important role in the future.
Looking at the progress of Big Data, and the evolution of SAP’s product portfolio, I believe that the future SAP landscape will consist of ERP (S/4), BW (BW on HANA) and Hadoop. From the currently available options to glue these technologies together, only some will survive the current evolution frenzy while others will disappear, fade out, or be will be integrated with each other. In future posts, I will elaborate on this and show ways to integrate the “good old” ABAP world with new Big Data technologies on Hadoop.
- SCN entry by Juergen Butsmann “The End of SAP Business Warehouse in the Context of S/4Hana is not in Sight!”
- Another post from Nov 2015 on the subject: “Seven Reasons Why S/4Hana Does Not Replace SAP BW” by Andreas Wilmsmeier
- E3 magazine January 2016, p. 20: “Neither fish nor flesh: SAP S/4 & HANA”