Make Your Case – Identify the Incremental Value of SAP S/4HANA

By Brianna Shipley, Director, Editorial, SAPinsider

The expanding role of business technology is visible not only in how it’s talked about — but also in who is doing the talking. Technology and its impact on the enterprise is no longer a point of discussion relevant for just the IT department or a priority for the CIO alone. It is quickly catching the attention of all lines of business (LoB) looking to understand how digital transformation can affect their specific objectives and ultimately enable the organization to run better.

SAP recognizes this need to engage a different audience than it has in the past when it comes to communicating the value of its software and solutions — SAP S/4HANA in particular — and is on a mission to help LoBs walk the walk and talk the talk.

“It’s important that LoBs understand enterprise challenges and how SAP S/4HANA can make their lives easier or improve their part of the business,” Dr. Marcus-Alexander Funke, Product Owner of SAP S/4HANA Value Starter at SAP, says.

“For example, the selling and quality of meat products greatly impact the bottom line for a butchery business. How can SAP S/4HANA help them in this area? The company’s CIO likely wouldn’t be able to provide this business perspective.” SAP launched the SAP S/4HANA Value Starter Program to help SAP customers get past one of the biggest obstacles to approaching the transition to SAP S/4HANA: building the benefit case.

Identify Your Unique Why

At the heart of any large investment, there must be a clear understanding of why. For many small- and medium-sized companies, having the time to consider this essential and complex topic is often a luxury. Without the time to compile research and develop a compelling business case, these mid-market SAP customers fall short of even starting the conversation about moving to SAP S/4HANA, leaving behind competitive advantages like better usability, end-to-end processes, and embedded analytics.

“SAP S/4HANA Value Starter is especially needed in regions of the world where the economy has a very strong footprint of mid-market companies like in Germany, Spain, or some countries in South America or South East Asia,” Dr. Funke says.

“SAP wants these customers to unlock the incremental capabilities that SAP S/4HANA can provide to help the business run better.” According to SAP, over 16,000 customers worldwide may still take advantage of a move to SAP S/4HANA. Of this number, 65% are considered to be mid-market customers.

With the SAP S/4HANA Value Starter Program, SAP works with the customer over one week in three half days, delivering customer-specific workshops remotely, at no cost, to help the customer to identify its unique purpose — its bespoke why — so that “no customer is left behind on its journey to becoming an intelligent enterprise,” Dr. Funke says.

Take Advantage of Global Knowledge to Simplify Business Priorities

Through the SAP S/4HANA Value Starter Program, SAP intends to share with its customers years of industry expertise and global business knowledge. The program helps them understand how outside forces may be impacting their businesses, what priorities and strategies can most effectively help them respond, and then develop effective key performance indicators (KPI) to set them on a path for improvement leveraging SAP S/4HANA.

“SAP provides this outside-in assessment rather than require our customers to collect and deliver this information,” Dr. Funke says.

SAP has found that the hundreds of priorities or challenges identified by businesses — although unique in the specifics — relate to four impact areas:

  • Revenue growth;
  • Profitability;
  • Asset efficiency; and
  • Strategic others, such as improved customer satisfaction, agility, or decision-making; reduced total cost of ownership or business and technology risk; and increased safety.

Once the customer-specific priorities have been mapped to the relevant impact areas, SAP helps them identify value drivers that other businesses with similar priorities have realized as a result of moving to SAP S/4HANA.

“SAP facilitates the mechanics required to link improvement potential to value drivers and the incremental capabilities of SAP S/4HANA,” Dr. Funke says, which can result in a compelling value case.

“If business is not supporting the change, they will be reluctant to provide the budget,” Dr. Funke says.

Consider how the SAP S/4HANA Value Starter Program enabled one company in the engineering, construction, and operations industry to convince its business and its customer board that SAP S/4HANA is more than just a technical upgrade. Through the engagement with the customer, SAP was able to help the company identify its top business priorities. Next, SAP helped the company discover how SAP S/4HANA could unlock the ability to run previously parked projects crucial for business development and new business model activation.

Empowered by information about how SAP S/4HANA could address business expectations, the CIO was able to deliver the needed value arguments to LoB representatives and the customer board and showcase SAP S/4HANA as the central element of the company’s digital transformation. And of course measure the benefits along the value drivers that have been laid out.

Move Forward in an Integrated Way to Become a Digital Enterprise

The move to SAP S/4HANA is being considered less as a technical upgrade and viewed more through the lens of a strategic business decision. SAP customers recognize this and have been asking for SAP to work together with SAP partners and hyperscalers to facilitate an integrated and connected experience that considers their landscapes and relationships. RISE with SAP was introduced as the solution to this requirement.

RISE with SAP introduced SAP’s business-transformation-as-a-service offering that bundles key SAP software solutions including SAP S/4HANA deployed into the cloud, tools, and services. It does this by offering tailored guidance and expertise to migrate from a legacy system into a cloud environment. According to Dr. Funke, the Value Starter Program complements RISE with SAP.

“The SAP S/4HANA Value Starter Program can be viewed as the ‘why’ and RISE with SAP can be considered the ‘what’ or ‘how.’ Understanding the ‘why’ is an important first step so that businesses are empowered to continue on their journey and map out additional opportunities to partner with SAP along the way,” he says. “SAP considers it an obligation to provide this methodology to SAP customers.”

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