SAP's S/4HANA Cloud goal is outcomes, not deployment model

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When it was 1st unveiled in 2016, SAP S/4HANA Cloud was observed as an underfeatured cloud edition of the on-premises S/4HANA.

Considering that then, SAP has on a regular basis included functionality to S/4HANA Cloud, positioning it as the practical main of SAP’s clever company, which involves working with systems this sort of as advanced analytics and AI to assist corporations turn into much more adaptable and resilient.

SAP has confronted worries in moving its significant consumer base that has remained on legacy on-premises programs to S/4HANA Cloud, but this migration is the best way to consider edge of S/4HANA Cloud’s performance and overall flexibility, according to Sven Denecken, senior vice president and COO of S/4HANA and head of product or service achievement at SAP.

In this Q&A, Denecken discusses why standardization is vital to a customer’s S/4HANA Cloud achievements and why the cloud delivers companies far more versatility to answer to transforming business situations.

What ought to buyers think about as they believe about deploying S/4HANA Cloud?

Sven Denecken: The deployment product [for S/4HANA] is not the problem. The situation is the diploma of standardization and the willingness of the consumer to spend in their possess IT or consulting methods to configure the option to a specified degree. That is why you do not care the place it is running — infrastructure as a assistance really should be a commodity — but you do care how a lot providers are inclined to standardize. Multi-tenant SaaS is the greatest diploma of standardization.

Most SAP systems are tailored to different degrees. Does the standardization of S/4HANA Cloud mean that customers are unable to personalize to meet their needs?

Sven Denecken

Denecken: Of training course we shouldn’t punish a shopper for [their decision to customize] mainly because there will be some items they want to tweak. That is why extensibility with SAP Business Technological know-how System [BTP] is the forex. You can update the main, you can update finance, you can update logistics, you can update production, and with a whitelisted API, there could be a incredibly precise extension. Connecting that with Rise with SAP [the program to help move SAP customers to S/4HANA Cloud], we will need to analyze wherever the client is right now, we need to have to agree with the customer on where they want to go, and then we do it at their rate. Due to the fact if you only have SaaS, there is only a single way, and that flexibility assisted us a good deal. And that is what you see in the expansion.

So it is really a matter of simplifying and focusing on the final result instead than how the method is deployed?

Denecken: Absolutely. In the conclude, it arrives down to internal business processes. That’s one of the topics that with S/4HANA is actually additional than just the core itself. Supply chain is in there, as very well as industry cloud methods that we construct as extensions on BTP, and sustainability [products]. Offer chain has demonstrated that, once more, the cloud deployment product has a remarkable strategy to alterations.

For instance, we have the SAP IBP [Integrated Business Planning] module for supply chain. It sits in the provide chain purpose of S/4HANA, but it can be a cloud solution that you can connect even if you are however on ECC [SAP ERP Central Component], if you are on the way to S/4HANA, if you run S/4HANA on your individual servers or if you happen to be on general public cloud. IBP desired to change for the reason that for many years we optimized provide chains on demand — how considerably we acquire designed the demand from customers, and that was your scheduling. But that turned about, not only with the ship [that got stuck in the] Suez Canal, the pandemic, the war. It fully turned close to and constrained offer chains. But if a customer has IBP mounted [on premises] and custom-made to their desires, it really is much too late to alter that. In a cloud remedy, you can transform it all-around to have a constraint-driven provide plan, which no a single was wondering about ahead of.

What are some other updates to the performance in S/4HANA Cloud that illustrate its price?

Denecken: A further progress that we place out was in electronic producing. In 1 concrete instance, a purchaser in Switzerland identified as Intelligent Press Store provides most of the entire body of a Porsche Cayenne. They have a entire electronic manufacturing unit with everything on the public cloud. With SAP [Digital] Producing Cloud, which is a section of S/4HANA Cloud, they have produced a electronic twin [of manufacturing operations]. So if they facial area any constraints — either Porsche supplying them extra or much less need, or suppliers’ [quantity of] steel or aluminum coming in much more or fewer — the electronic twin of that reality helps the enterprise to prepare for that. It really is like a command tower for the complete producing [process]. That is some thing exactly where we see that acceptance toward general public cloud alternatives. They have zero set up servers, they have zero individuals customizing, and of training course all those are evolutions that we assumed even three many years in the past would in no way transpire.

Jim O’Donnell is a TechTarget information author who addresses ERP and other organization apps for SearchSAP and SearchERP.