I’d like to review this together with an EPR expert, Mark Albrecht from itelligence. Mark has been in ERP since ages and will share his observation on a rapidly changing market.
Mark can you first say a few words about yourself?
MA: As VP Global Business Solution I am responsible for the adoption and deployment of new SAP Technologies into the worldwide organization of itelligence and NTT Data. This includes as well the internal knowledge Transfer and transformation of own SAP extension from the on premise Arena into the Cloud World, and utilizing this knowhow to consult our customers to choose the right strategy for their future landscape.
YP: how did you see the ERP market evolve over the last year? What are you key observations?
MA: Customers in the ERP world already starting the discussion and strategy to adopt Processes and innovation beyond the classic ERP Space. It is a prerequisite to consider scenarios and processes where Business Networks and integration beyond customer processes is required. Customers already working in these environments without Naming this specifically and publishing of self-services for their customers is already a common standard.
YP: Here we go with the new things from SAP S/4HANA Cloud last product update. One of the key enhancements in with SAP S/4HANA cloud is the integration of logistic processes. How is this going to change the way customers run their businesses?
MA: In previous S/4HANA cloud releases we recognized the limitation to handle fully integrated processes. With the new release and the capabilities to run cover logistic and manufacturing processes it opens a broader portfolio, especially in the most dominant discrete Industry segment, where these requirements are mandatory for HQ and subsidiary organizations.
YP: what is for you the “typical” cloud customer?
MA: This is a mindset question. Independent of the size of customer it is required that customers are open to “fit to standard” scenarios by being to open to change their internal processes aligned to pre-defined Cloud processes. This will also change the requirements for service partner, as the requirement of change management get more visibility than in the On Prem world where the Software is designed in many cases around existing processes.
YP: where would you recommend an existing SAP on premise customer to start their journey to the cloud?
MA: The clear guidance is to validate the Cloud Version and validating on a high level if existing processes can be covered by the cloud Roadmap and where are their current and future pain points. This also includes to invest time to analyze future changes within their market. Depending on their pain points the cloud journey can be individually designed. In most of the cases we are starting in a hybrid scenario where new Business requirements are handled in the cloud and are integrated into the on prem world. We also recommend to validate existing extensions if these are mandatory and a key differentiator in their individual market position. For all non-differentiation processes we suggest to investigate a cloud approach in detail.
YP: What is the opportunity for “2-tier” ERP scenario based on your experience?
MA: 2-tier ERP is with S/4HANA 1708 is a very valid option, as especially the integration of a flexible Cloud solution for subsidiaries in combination with a highly customized on premise headquarter system provides additional local flexibility. Especially with regard for financial closing and headquarter consolidation this provides a major benefit by having locally the flexibility in adoption of logistic best practices. Important is to use “fit to standard” in the subsidiary and full flexibility in larger entities or headquarter organization. This would also support the agile adoption of local market trends by having more local flexibility and supporting headquarter related reporting processes at the same time. This also provides the chance to utilize pilot market to support the digital transformation journey of a customer
YP: Thanks a lot for sharing your views Mark. Any closing words?
MA: SAP S/4HANA Cloud is covering more and more business processes. By utilizing the SAP Cloud Platform as the extension platform it will also provide our customer the chance to adopt individual and compelling extensions to customer market needs to fulfill local reporting or End2End Customer integration scenarios.
Follow Mark @Mark_NTTData
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