Updated May 4, 2020
Enterprises now accept the reality that integrated digital technology signals constantly changing customer experiences, operation models, and business models. In this post-digital era, organizations cannot afford business disruptions that consume resources and budgets. Yet this is exactly the position many organizations have found themselves in when undertaking large enterprise packaged application implementations like SAP S/4HANA.
Businesses cannot stand still. Updates still need to be made. And processes must continue to run seamlessly, even during massive implementations like S/4HANA. It is imperative that organizations carefully plan and execute their journey to S/4HANA to ensure continuity and mitigate risk. SAP S/4HANA projects not only represent a major technological change but also a change in the way that technology is delivered. Unlike the lengthy waterfall system implementations of the past, S/4HANA is architected to be delivered in smaller, functional pieces using a Scaled Agile Framework (SAFe) over multiple planning increments (PIs).
Given this is a large change for IT and business, many companies are sticking their proverbial toe in the water with small first movements to the cloud and responsive web applications. HR systems seem to be the most popular for the first implementation. Moving from a classic, on premise solution to cloud-hosted solutions involves a staged rollout (quarterly PIss), along with moving to new browser-based applications, and in many cases consolidation of multiple systems into a single, global solution. This sweeping move is the first step into the larger transformation to which these lessons are applied and then used to scale the next transformation.
“Digital transformation is about a movement. This is more than a project and requires an ongoing commitment to transforming business models and improving digital channels.”
- R "Ray" Wang | Principal Analyst & Founder | Constellation Research, Inc.
Change Management Transformation
To prepare for the move to Agile methodologies and S/4HANA, organizations are transforming their existing change management processes in order to meet the challenges of S/4HANA and associated applications. And this shift to S/4HANA marks only the beginning of an organization’s digital transformation.
From Project to Value
In today’s climate of constant change, transformation is ongoing, and businesses who intend to thrive in the 21st century will have to continually transform—or be left behind.
This realization presents a shift in thinking:from project to value. Agile assumes cost and time are fixed and views project scope as the variable. But how do you apply this type of thinking to a large ERP implementation where sizeable blocks of functionality may need to be completed in order to promote the feature to the next level of review? What about inter-dependencies of specific modules?
As the paradigm shifts, process automation is no longer considered a luxury. It is a requirement. With each new feature and release, all tests will need to be run. And it’s not just the new S/4HANA processes that will need to be tested. All of the supporting upstream and downstream systems will need to be tested end-to-end. The only way to do this effectively is with automation.
Automate Early and Often
Savvy teams will be proactive and start building test automation long before they have to start building tests for S/4HANA. Why? Because automating known business processes earlier will accelerate ultimate delivery timelines by establishing automation that can be expanded as feature lists grow, rather than waiting until the final business process design and delivery are complete.
Preparing for S/4HANA requires shifts in thinking, both internally and externally. Below are five core areas to consider when planning an S/4HANA transformation:
1. Project Scope
To effectively scope S/4HANA implementation deliverables, obtain a clear understanding of existing business processes, sub-processes, customized systems, affected business units, and users. Determine the number of expected workflows, reports, interfaces, conversions, extensions, and forms (WRICEFs). And clearly define processes, systems and new integrations.
Deconstructing all of these details will require the involvement of multiple users across the organization. To keep everyone on track, create a clear responsible, accountable, consulted and informed (RACI) chart. Now consider the velocity with which changes will be made in Agile and one can see how project documentation and delivery teams can quickly become overwhelmed, which is where problems can occur. Teams may be forced to choose between properly documenting and analyzing a change vs. moving forward with the change in order to meet a deadline.
2. Master Content and Accelerators
Employing the Master Content model and accelerators can be a great way to jump-start deployment efforts while reducing risks. The SAP Model Company has been proven to accelerate project development and discovery times and reduce maintenance and custom development spending. While SAP Model Company is available to help guide your transformation, there is no one-size-fits-all solution for large enterprise SAP S/4HANA conversions. For this reason, many companies engage the help of a Systems Integrator with industry-specific experience that can help them best leverage this approach, while also overcoming challenges unique to their environment.
3. Backlog and Ongoing Change Management
The Backlog and ongoing change management for an S/4HANA project will be much more challenging than dealing with a small development project. The backlog in an S/4HANA project is not constrained to activities related to development, but also consists of things like data support, training, deployment, Change Control Boards (CCB) Reviews, compliance audits, and more. To complicate things further, the backlog may be composed of requirements from multiple teams with conflicting priorities. How to schedule, prioritize and manage communications across the multiple teams requires more orchestration and involvement at the executive level than what is used in most Agile practices today.
4. Centralized Management and Approvals
Some level of centralized management is necessary to any large-scale enterprise project. Executive support is critical to ongoing project success and periodic reviews need to be scheduled. Engaging this level of support frequently requires additional documentation, which can bein direct contrast with the core principles of Agile.
In addition, the nature of centralized management itself must be adapted to support the Agile delivery of services. Change Control Boards (CCB) must be available to review new functionality when it is ready versus reviewing based on a set schedule. Security and compliance reviews also need to be added to the backlog, while testing teams will need to have tests built and ready to run.
5. Exhaustive Testing
When budgets run low and deployment windows get tight, testing is often sacrificed. Failing to thoroughly test a system or understand the extent to which a system may fail is a recipe for disaster. At a minimum, organizations could face expensive rework. But more devastating results are possible that could negatively affects the organization for years to come.
Management of integrated testing can also be challenging since much of ERP testing requires the involvement of multiple teams. Deciding who will own and maintain automation in the long-term becomes a question that must be addressed outside of Agile practices.
Bottom line? Understanding, ongoing change management and expansive automation adoption are the keys to successfully adopting both Agile and S/4HANA. And the time to start thinking about the best practices, tools and teams needed to support the ongoing change management needed for S/4HANA is now.
Evaluating your S/4HANA Readiness? Download our S/4HANA Solution Guide, visit our SAP S/4HANA Testing page, or review this S/4HANA Readiness Check to learn how automation helps organizations meet the challenges associated with S/4HANA projects.