By Robert MacDonald, Innovation and Technology Manager at Absoft.
Two years spent prioritising business survival during a pandemic have thrown up an extraordinary array of operational challenges for most companies – and exciting opportunities for some. Either way, for the vast majority, technology and operational plans in 2022 look very different to the strategic direction outlined pre-2020. And, as such, while many businesses know that change and investment are both overdue and essential, questions abound when it comes to framing a post-pandemic IT model, especially when capital resources are stretched.
Plus, of course, two years is a long time in technology and businesses now face not only the technical concerns of creaking equipment today, but also the matter on the horizon of SAP ECC going out-of-support in the next 5+ years. In what is now a very different business, competitive and financial landscape, many organisations are unsure how to progress. Is it possible to mitigate the technology issues but also drive tangible value? Can a business balance the need to fix very specific and often urgent operational issues with a strategic plan for migration to SAP S/4HANA?
An immediate migration to the cloud can quickly deliver financial and operational benefits while also preparing for future digital transformation but, warns Robert MacDonald, Innovation and Technology Manager ensuring the right mix of technical and functional SAP skills as well as cloud expertise is absolutely vital to both immediate success and strategic direction.
For the vast majority of companies, the focus has been on maintaining the status quo over the past two years. Technology change and investment have been minimal – aside from enabling home working where both possible and necessary. In the main, only companies with end-of-life equipment that represented a serious business risk have felt compelled to do anything more than keep the lights on.
In the meantime, however, the SAP ECC on-premises technology model has not only become more high risk post-pandemic, with a restriction on business agility and an operational constraint; exposure to downtime; and less financially compelling. Companies are struggling to adapt to the new business challenges with inflexible reporting and on-premises solutions that cannot be rapidly expanded to support new business partners. Even more frustratingly, many businesses have a complex mix of products/integrations and over-specified infrastructure that is demanding far too much time, money and resources – and failing to meet critical business needs.
With the migration to SAP S/4HANA somewhere on the agenda over the next four years, companies know change is required – according to the annual UK and Ireland SAP User Group (UKISUG) member survey, 74% of its affiliating organisations are either using S/4HANA or planning to do so. S/4HANA is a big migration, however, one that demands time, resources and a commitment to digital transformation. Yet many businesses have a number of pressing business problems that need a fast fix: there is no money to fund a big migration or time to waste. So what are the options?
It may surprise many businesses to know just how quickly many of these issues can be resolved with the right balance of technical expertise and strategic advice. The priority is to move the existing, on-premises ECC solution into the cloud – a process that can be achieved in a matter of months, with minimal disruption. Taking this approach provides immediate access to an extraordinary array of benefits – most notably access to cloud-based solutions that can immediately address these pressing operational problems.
Cloud-based reporting is a revelation for many businesses, for example, especially those still wrestling with time-consuming, month-end reporting and Excel spreadsheets. Fast, mobile access to in-depth reporting and analysis will transform decision making. Easy to deploy apps can ensure new business partners – such as transport companies filling the gaps created by the driver shortage – can link directly with the core system, seamlessly updating key information, such as deliveries.
Technical, Functional and Strategic
This ability to solve pressing operational problems is compelling – but many businesses lack confidence in the process of cloud migration and are, frankly, hamstrung by a lack of strategic, trusted advice. From a practical perspective, there is a well-publicised SAP skills shortage. However, this is not really the biggest issue: a successful cloud migration requires not only SAP technical skills but also functional knowledge, expertise in cloud providers – specifically Microsoft Azure, with its pledge to be the best hyperscale cloud provider for SAP customers – and trusted strategic insight. And it is this combined skillset that is missing from much of the MSP market.
Any decent SAP engineer can copy an on-premises system into the cloud – but that is just part of a successful cloud migration. Issues with network connectivity, speed and latency are also easily solved. Rather, it is the functional side of the process that is key, such as ensuring interfaces – including vital EDI links – are working effectively from day one. In addition, a truly valuable migration is one that encompasses rationalisation, especially for those organisations that have an extensive SAP deployment, including Customer Relationship Management (CRM), Supplier Relationship Management (SRM) and SAP Business Warehouse, running across multiple servers.
With the right technical, functional and Azure expertise an MSP can quickly explore rationalisation options. SRM, for example, can be replaced with a far more simple, effective cloud-based app alongside ECC. This not only eliminates a complex area of the SAP deployment but also aligns the business’s future direction with SAP’s strategic plans: S/4HANA brings all the functionality of these diverse solutions into one product. Ensuring an MSP can offer these functional skills alongside SAP technical expertise is vital to a successful cloud migration.
Businesses need to find a quick, effective solution to current operational and technical concerns – and, for the vast majority, this rules out a migration to S/4HANA anytime soon. However, a migration to the cloud will create a stable technical foundation upon which businesses can build incrementally. In addition to gaining access to a compelling array of cloud solutions that can be rapidly deployed to fix business problems, embracing a ‘cloud mindset’ will bring businesses closer to S/4HANA, helping them on the journey, while also delivering immediate business benefits.
The cloud offers extraordinary flexibility – use it. That means spinning up test environments on demand – for just a week or two. It means scaling up and down in line with business needs. It means gaining access to high availability and business continuity services, without incurring massive additional costs. And it means future proofing the business today and creating time to plan the strategic migration to S/4HANA when ready.