Key Challenges in building a Business Case for SAP S/4HANA Digital Journey

⇨ Although SAP S/4HANA brings many advantages to an organization, the implementation requires a significant investment in terms of money, time, effort, and expertise.

⇨ Building a business case for any such initiative requires organizational stakeholders like CIO/IT leadership, CFO, and other leaders to collaborate and align on technical benefits and organizational goals.

⇨ oXya helps address the challenges in building a strong business case and accelerates the move to SAP S/4HANA.

SAP S/4HANA implementation is an important part of digital transformation. It offers several benefits including real-time analytics, advanced AI, and cloud capabilities. Although SAP S/4HANA brings many advantages to an organization, the implementation requires a significant investment in terms of money, time, effort, and expertise. However, in most organizations, while the IT teams focus on adopting the latest digital technologies, leadership often prioritizes driving overall growth, boosting sales, revenue, and reducing costs. This lack of alignment is a major challenge in any digital transformation initiative like SAP S/4HANA implementation. Building a business case for any such initiative requires organizational stakeholders like CIO/IT leadership, CFO, and other LOB leaders to collaborate and align on technical benefits and organizational goals.

The following are major considerations for building a strong business case for SAP S/4HANA implementation.

Cost Considerations

One of the primary challenges in building a business case for SAP S/4HANA is the monetary investment required. Implementing SAP S/4HANA involves not only software costs but also implementation services, training, and licensing expenses. It can be a significant financial commitment for the organization considering the move, and justifying this cost to stakeholders can be a challenging task. Thorough cost-benefit analysis, including both short-term and long-term benefits, is necessary. Companies must be able to envision how implementing SAP S/4HANA will help increase operational efficiency, provide real-time insights, and ultimately lead to cost savings.

ROI and Benefits Realization

While SAP S/4HANA has a wide range of benefits, quantifying these benefits in monetary terms can be tricky. Identifying key performance indicators (KPIs) of the SAP S/4HANA implementation and measuring the ROI is crucial for building a compelling business case. Without a clear understanding of the expected benefits and a solid plan for realizing them, obtaining buy-in from decision-makers can be challenging.

Integration Complexities

Many organizations have complex IT landscapes with multiple systems and legacy applications in place. Integrating SAP S/4HANA with existing systems and ensuring data migration can be a significant challenge in the digital transformation journey, which may require the expertise of an SAP implementation partner. Working with the implementation partner, the company must create a well-defined migration strategy.

Change Management

Moving to SAP S/4HANA represents a significant change for an organization, impacting business processes and workflows. Building a business case that includes a comprehensive change management strategy is essential to address and mitigate this challenge. The change management strategy change should outline the methods of training, communication, and support to facilitate the transition.

Timeline and Resource Constraints

Implementing SAP S/4HANA is a complex and time-consuming process that requires dedicated resources and expertise. Balancing the project timeline with daily operations and ensuring that the necessary resources are available can be a major challenge for organizations. Delays in the implementation process can not only impact the project’s success but also increase costs, making it crucial to account for resource constraints in the business case.

Compliance and Risk Management

Moving to a new ERP system may raise questions around risk and compliance. Similar to any digital transformation, SAP S/4HANA implementation process can also be taken advantage of by threat actors, if the security and compliance controls that were part of the legacy systems are not adopted into the new system. This is particularly important in highly regulated industries to avoid any form of compliance issue or data breach.

Overcoming these challenges requires a thorough understanding of the organization’s current state, a clear vision of the future, and a well-structured business case that addresses the cost, benefits, integration, change management, and resource considerations. Working with a partner like oXya helps address these challenges and accelerates the move to SAP S/4HANA. Their expertise lies in implementing and migrating large and mid-sized enterprises to SAP S/4HANA – both greenfield implementations and complex brownfield migrations. With oXya, organizations can build a strong business case for SAP S/4HANA digital journey and secure the support needed for a successful implementation.