For years and years businesses have utilised Enterprise Resource Planning (ERP) Systems to standardise processes and manage information. And for a long time the developmental changes in these systems has been sloth-like. Not to say that there have not been improvements, but the improvements have always remained slow and slight in advancement. In order to run better, smarter and faster businesses, there has to be a significant transformation in the software systems used to run successful organisations.
Generally, the purpose of ERPs is to plan and integrate various operational systems and subsystems in order to improve business and gain competitive advantage. This is done through the careful integration of software, hardware and processes, to connect whole organisations from production to sales, human capital, customer relationship management and business analytics, based on the requirements of the specific enterprise. The connectivity within ERP systems is achieved through the application of business functions or modules customised to suit the company. This has long since been the legacy of ERP’s but that too is changing with the advent of an increasingly digitally transformed world.
Whilst the general purpose of ERP’s has remained the same, there has been substantial progression in achieving greater simplification of processes and ultimately cutting out complexities. The emergence of new wave systems and technologies has subsequently brought about radical problem-solving capabilities to do just that.
Rogue One: The SAP S/4HANA Story
Realising that ERPs are reaching the proverbial glass ceiling, SAP has identified the need for a revolutionary system with the ability to sustain growth and take advantage of the latest technology to attain noteworthy improvements in performance, speed, and efficiency. Leveraging on in-memory computing in the cloud, in addition to simplified structures, SAP has introduced S/4HANA and S/4HANA Cloud, an innovative technology that enables businesses to run “live” using real-time data. As is the case whenever people become accustomed to doing things one way, it may be difficult to embrace such a drastic change in ERP systems. However, it must be noted that this system not only solves customers’ basic challenges but rather goes a step further through instantaneous intuitive predictions and revenue prospect scouting.
SAP S/4HANA is an overhaul of software solutions providing infinite flexibility through both on-premise and cloud deployment. Its in-memory computing, makes data processing exponentially faster whilst its simple architecture eradicates over three quarters of data layers. This streamlined data structure blows relational database technology and complex data structures out of the water proving that radical change can be a good thing too.
Modular Differences in Legacy ERP vs SAP S/4HANA
As ERP software continues to evolve, there comes the question of what makes SAP S/4HANA so different to legacy ERPs. Ultimately, all ERP software is built to integrate cutting edge technologies and simplify business processes. Nonetheless, when you look into the core of these systems it is more about the efficiencies achieved by utilising them.
Looking at supply chain management for instance, legacy ERP’s are markedly sluggish in updating information thereby slowing down the process of data transfer. In high volume environments were the next procedure in logistics cannot be carried out without information from the previous step it becomes extremely difficult to execute efficiently and effectively. The SAP S/4HANA platform on the other hand, is made to avoid specifically that. With its simplified data structure, the system is able to process information in real-time facilitating fast-tracked responses. This inevitably means that the program can initiate intelligent solutions to supply chain issues.
Through SAP S/4HANA, sales and marketing personnel are able to detect social media trends and formulate directed campaigns for segmented customers and engage them promptly. In this scenario S/4HANA again comes out tops by exploiting the integrated nature of the system. Legacy ERP’s however, lack the capacity to monitor feeds without supplementary solutions that would need to be added to the existing system, meaning that the organisation is then deprived of the chance to connect with audiences at the time that they are active online.
The key motivation for companies acquiring ERP solutions is the expectation of an improved bottom line and obvious return-on-investment. For this reason, the financials module is one of the most watched as it directly relates to the revenue and expenditure of a business. End of year reports and even monthly reports require tables with financial data from business units or country offices depending on the business. This can be difficult to collate with legacy ERP’s that then generate multiple tables for the different units, which may take long stretches of time and are subject to lags and miscalculations. Alternatively, SAP S/4HANA with its real-time information processing power can produce several financial statements at any time for the whole organisation or any section of the business. This then allows accounting staff to concentrate on core business activities rather than reporting.
When it comes to business it is crucial to be able to make predictions about various business activities including sales, purchases and so on. SAP S/4HANA facilitates this process by giving an organisation the ability to use both internal and external data to perform countless simulations. These simulations can be produced in real-time and assessed to determine business value and possible risk. This in turn, enables the company to take advantage of infinite prospects that may not have been visible to the business otherwise. Conversely, legacy ERP’s can take days to construct such forecasts and by the time this eventually happens the information collated is null and void.
To the Future and Beyond
ERP software is built to make business simple. As such ERP’s that lag in their integrative capabilities should be a thing of the past. Solutions that can bring together infinite data sources with ease are the face of the future. Real-time access should not be an option but rather a given as business occurs in the now and not two days later. SAP S/4 HANA does just that by making in-the-moment decision making an expectation. Once you experience real-time business, there is no turning back.