All of SAP’s S/4 transformation concepts have one thing in common: Because they are so innovative and agile, they work perfectly for the greenfield approach. However, only a few SAP customers meet the business, technological, organizational, and financial requirements to opt for the greenfield approach. Brownfield is an alternative if companies have to migrate, but brownfield is more a situation than a strategy.
Long-term SAP partner SNP has developed the bluefield approach as kind of a bridge between greenfield and brownfield. However, bluefield is more service repair behavior than innovative breakthrough. Most customers don’t need a new tool for every individual solution, and they don’t care about the color of the approach. Customers deserve an answer to the most pressing question: Why should they replace a monolithic ERP system with another monolithic ERP system?
Monopoly or polypoly?
Former SAP CEO Bill McDermott might have started out small with Simple Finance, but he soon began to think bigger and acquire a lot of cloud solution providers. He wanted to restore SAP’s ERP monopoly, to make S/4 in the cloud what R/2 and R/3 had been in customers’ datacenters. “Cloud Only” was McDermott’s vision, and SAP complied.
Business Partner exemplifies this vision. SAP Business Partner is a person, organization, group of persons, or group of organizations that a company has a business interest in. For anyone who has worked in SAP ERP, Business Partner replaces the SAP Objects Customer and Vendor as well as all other partner objects except for the HR Personnel number. No differentiation, just one monolithic data set for everything. Business Partner is the incarnation of an encompassing claim to power.
Why negate the technological development of the past years? The conversion from one monolithic system to another does not promise any business, technological, or financial value. If SAP’s ERP monopoly’s foundation is AnyDB or Hana shouldn’t matter. However, can it even be called a monopoly anymore? Or should we start referring to it as a polypoly?
The answer to that question is rather simple, as the SAP scene can proudly look back on an innovative and diverse history concerning technology and business. One of the most striking examples can be found in the automotive industry. In the past, it was almost mandatory for automotive suppliers to operate SAP systems because almost all automotive companies used SAP software. Suppliers’ compatibility with their biggest customers was a huge competitive advantage. Now, there are new ways to decouple internal IT structures and external compatibility. For example, SEF Automotive, a global supplier of car parts, switched from SAP to Infor in 2019.
Continuing to use an ERP system without being SAP customer – during the S/4 evaluation phase (which is already in full swing), the SAP community will probably hear a lot about similar decisions to defect from the ERP world leader. Which isn’t all that surprising, considering the meteoric rise that open source and hybrid architectures have been on for the past few years. Through platforms, for example, ERP users are compatible with a variety of systems, including SAP. It’s just not necessary anymore to jump from one monolithic system to the next.
SurpRISE With SAP
After Run Simple, “RISE With SAP” is SAP’s newest offer to help customers become intelligent enterprises. RISE is supposed to be more than a technical migration to the cloud. It’s supposed to enable continuous, comprehensive business transformation. Relying on its strong partner ecosystem, SAP wants to take customers by the hand and guide them through the process of becoming truly intelligent.
To mark the SAP strategy event “RISE with SAP: The introduction”, Jens Hungershausen, Chairman of the German-speaking SAP user group (DSAG) gave his thoughts on SAP’s announcements on S/4 Hana public and private cloud. “The demands companies face in terms of speed, efficiency, and process intelligence are growing constantly, which is why it’s imperative they have the right software and technology. S/4 Hana public or private cloud might be the solution for them. But companies’ IT landscapes are heterogeneous, so there can’t be a one-size-fits-all strategy. As a group representing the interests of more than 3,700 SAP user companies in German-speaking countries, we welcome the new SAP initiative RISE With SAP, which will support companies on their own unique paths to the cloud.” It seems important to Hungershausen to not lump the SAP community together to fit one monolithic approach, but to understand that it’s a hive of different individual companies with diverse needs.
While SAP CEO Klein negated that RISE would force customers into the cloud, it is still designed to facilitate the switch – an interesting and exciting approach, according to Steffen Pietsch, DSAG Technology Director. “We see the huge potential and benefits of cloud-based solutions – but also the challenges facing SAP customers. With RISE, SAP aims to smooth its customers’ paths to the cloud and S/4, something which, as a user organization, we wholeheartedly support. The opportunity and also the challenge in transitioning from Business Suite to S/4 lie in the accompanying business transformation and business process adaptation. A simple ‘lift and shift’ from on-premises systems to a cloud environment is not enough, or is just the first step. SAP and its partners must highlight the ways in which they want to transfer highly customized systems and processes to S/4 cloud environments and provide information on the kind of support required on the customer side. […] This is not a technical migration; it’s a transformation that really necessitates taking a closer look at the customer’s specific requirements and context and having a holistic view of the system landscape. […] Right now, there is not enough information available to evaluate the viability of the RISE model.”
I would like to add to Pietsch’s comment: We don’t have enough information about RISE, period. While SAP partners are trying their best to make it make sense, like Avantra in a continually updated blog post, new details continue to pop up like dandelions. For example, Diginomica’s Jon Reed confirmed in a tweet that, even though SAP said RISE would only mean one contract for all the involved parties, system integrators are not included in this. So, the million-dollar question seems to be: What exactly is RISE?
This is the first article in a two-part series! If you would like to read the second one, click here.