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S/4HANA momentum continues with 4 major releases and over 1,000 live customers. Still, one of the top questions I get is, “Why doesn’t S/4HANA run on Oracle (or any other database besides HANA)?” This is a natural question, especially since SAP partnered with database vendors for our products prior to S/4HANA. Sometimes there is even speculation of an “S/4Oracle.” It’s not going to happen. Continue reading to learn what makes S/4HANA unique, and why ERP running on legacy database systems are now obsolete with S/4HANA and S/4HANA Cloud.

Why HANA?

Several years ago, SAP introduced the motto “Run Simple.” This is a nice sentiment, but how do we make it real? We start with the data model used to run ERP. The data model had to be simplified—this is the foundation of every innovation since.

Some concrete examples:

  • Inventory Management went from 26 tables in ECC 6 on legacy database to 1 table on HANA.
  • In Finance, the Universal Journal (1 table) eliminates the painful process of FI-CO reconciliation (many tables).
  • Extended Warehouse Management is back in core ERP and no longer needs its own system since the complex model required by legacy databases is gone. The same is true for Transportation Management, Advanced Available to Promise, and Advanced Variant Configuration, among others.

These aren’t dreams—these are innovations and productivity gains our customers are getting now. Imagine liberating your finance department from unproductive spreadsheet rodeos like reconciliation. Imagine providing your colleagues in supply chain MRP runs whenever they want, not just once per day. You can do this all while simplifying the IT landscape. With a simpler data model, your IT department is ready for anything, and your business is equipped with new, real-time capabilities.

These gains are simply not possible running on legacy database systems. We had to take the dramatic step of re-designing for an in-memory, columnar database. Obviously, we chose HANA for that. It isn’t good enough to take the 26 tables for Inventory Management and run them in-memory on, say, Oracle 12c. Simply running in-memory isn’t enough—we needed to leverage in-memory to redesign for a single data model. If you have a couple minutes, take a look at my video explanations here, here, and here. If you have more time, get a deep dive here.

This is also a recognition that with the move to a pure in-memory architecture, the two layers of database and application are merging. In the past, we depended on a separate database layer to organize data for transactions and analytics. Now the application can access the data with plenty of speed in-memory and not need to have it organized in advance. Trying to make this work with every database vendor’s different architecture would have limited the innovation and delayed the benefits for our customers.

This is why we won’t have an “S/4AnyDB.” We can’t move our customers back into the complex data models of into the past. We partner with database vendors for ECC 6 which we continue to support until 2025. This explains why you might see agreements with them: it’s to support the past, not enable the future.

Is It Working?

The real-world results are proving this was the correct strategy. The impact of a simpler data model is amazing. Business processes are transformed everywhere (see illustrations here). The best proof, however, is in the unprecedented adoption numbers for S/4HANA, the fastest-growing product in SAP’s 4-decade history. In a bit over 2 years, more than 6,300 customers have purchased it, and over 1,000 of them are already live (check out their stories). The transformation from traditional DB to the new HANA architecture has not been a limiting factor.

If you are running ECC 6, try our Business Scenario Recommendations tool as well as Readiness Check. With these free, personalized tools, you can find out exactly what the simpler data model of S/4HANA will mean for you.

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7 Comments

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  1. Michelle Crapo

    So…   What are the actual numbers or percentages?   How many SAP customers vs. how many customers with HANA?    The next metric that would be interesting – how many on premise vs. how many on the cloud?

    I would be really interested in the numbers. (Or even the numbers in percentages)  1000 live customers sounds really good.   I also know the number of SAP installations is “a lot” higher than that.   I’m guessing perhaps 1000 is less than 1%.   That is still good.  But a more interesting figure.

    Thank you!

    Michelle

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    1. Carl Dubler Post author

      The reason I am encouraged by the 1000 number (1,030 as of Oct 6) is that so many have gone live in production so quickly. Most of that number came after the 1511 release less than 2 years ago! When you consider that this is mission-critical ERP, I think that is very impressive. To be sure, there are many SAP customers who have not decided on S4 yet, but the momentum is unmistakable. We announced in Q3 that 6,300 have purchased S4–much higher than 1% of the customer base (I’m sure you want some more precision here, but I’m telling you what I can publicly).

      IDC and ASUG both have surveyed and found about 2/3 of SAP customers plan to go to S4 starting 2018. There’s data in the ASUG survey about plans for on prem vs cloud, etc.

      The 1000 number does not include HANA for other uses, like BW and ECC 6 on HANA (“Suite on HANA”).

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      1. Michelle Crapo

        That does make it interesting.   That is quicker installation than I would think.   I’ll check out the ASUG data.

        Thank you for the quick reply!

        Michelle

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  2. Matthew King

    S/4 is the “reunification” of SAP ERP.

    For years I worked with APO/BW/CRM and experienced first hand the complexity of integrating these tools with ECC. Often times I would lament the good old days of R/3 when we didn’t need to think too much about integration, at least not from the perspective of SAP applications.

    Recently I spent considerable time reading the “Simplification List for SAP S/4HANA 1610 – Feature Pack Stack 02” document.

    https://help.sap.com/doc/560c6fad1b03447583e7327f64f7d964/1610%20002/en-US/SIMPL_OP1610_FPS02.pdf

    It brings S/4 to life in a very real way – my eyes kept getting wider the more I read. I began to understand the magnitude of change – but was also stuck by how much functionality will carry over to S/4 from the Business Suite. We get to keep the functionality we known and mostly love and leave behind the rest. Hooray!

    However it also reveals that much work remains before the transformation is complete.

    But when it is – I suspect we will see a rapid period of migration – possibly between 2020 and 2025 for larger customers.  These migrations won’t be easy – and SAP (or consulting partners) need to provide migration tooling to facilitate the transition – but the destination will be worth it.

    In contrast I see the smaller customers moving to lighter weight solutions such as ByDesign during the same period.  The smallest of these customers should never have implemented ECC in the first place.  That’s what i call killing a fly with a sledgehammer.

    Mid size customers will migrate to S/4 in the cloud during the same period.

    In summary, SAP needs to hold fast to “HAsso’s New Architecture” and not lose it’s corporate nerve as this waiting game plays out – and as the various remaining technical hurdles are traversed.

    As far as S/4 being wedded to HANA is concerned – that isn’t so evil. Think about all the SaaS providers that put an entire tech stack into the hands of a single vendor.  In any case the performance benefits and technical simplicity demand it for reasons explained by Carl.

    Matt

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  3. michael penix

     

    It is my understanding that the “brown field” ECC to S4 migration tools provided by SAP will only be available until 2025 when support for ECC expires, is this correct?

    If this is true, what options are available for clients that remain on ECC 6.0 EHP8, as an example, after 2025, given that they are migrating but due to size will not complete full migration of all sites 3 or 4 years after 2025.

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    1. Carl Dubler Post author

      I have not heard that the tools “expire” in 2025. Anyway, that is not the case. The tools used to deploy and convert/migrate to S/4 (SUM, SWPM, S/4HANA Migration Cockpit, among others) are independent of ECC. Plus, it would be self-defeating for us to take these tools away.

      At the end of this blog I listed two tools helpful in planning for S/4: Business Scenario Recommendations and Readiness Check. My hope is that ECC customers will run these now, even if they don’t have concrete plans for S/4 yet. 2025 is a long way away. Business and competition change rapidly and the ERP core needs to keep up. There’s no cost in taking a look to see if S/4 could be closer than previously thought.

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  4. Tim Main

    I read this blog with interest, after reading the “The SAP Blue Book” A concise business guide to the world of SAP, by Michael Doane – Galilleo Press.

    Where the author correctly attributes one of the reasons for the wide deployment and growth of SAP Business Suite to the AnyDB / platform choice in chapter 2.2.2 page 30.

    Whilst also understanding IBM has had sample S/4 Simple Finance code successfully running over Db2 BLU for in excess of 24 months now, I personally believe the SAP strategy to only offer S/4 over SAP HANA (now 2.0 vs 1.0 before) at release 1709 vs prior releases of 1510, 1611 etc is largely a marketing choice that seeks to force a top to bottom SAP stack over a Linux platform (either Intel or indeed HANA on Power).

    Personally I’ve also head significant Enterprise SAP Clients (who still have mixed ERP estates) indicate they would rather revise their prior SAP 1st deployment strategies towards alternative ERP SaaS providers vs facing a forced, complex and costly transition from their existing customised SAP Business Suite / ERP deployments onto S/4 HANA where the ROI vs the cost and risk is unclear

    Kind Regards, Tim

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