Analyzing Clean Core Components

In the previous unit, we looked at a few of the challenges facing enterprises in today's world. We saw how SAP S/4HANA Cloud provides a solution for these challenges. It provides vital functions for managing various business processes, including finance, procurement, supply chain, customer relationship management, and more. However, we also noted that as a cloud-based solution, enterprises adopting SAP S/4HANA Cloud must take a modified approach to areas such as extensions, integrations, and operations relative to what they have historically had to do with on premised based SAP ERP systems.. We now turn our attention to this approach. It can be summed up in one easy to remember phrase: "clean core". In this lesson, we explore what we mean when we say that customers must think about and embrace the concept of a clean core with regards to SAP S/4HANA Cloud.

By "Core" we are referring to several "dimensions" (or "pillars" if you prefer), each one of which represents a different way that a customer can think about and analyze their ERP system. Those dimensions (in no particular order) are as follows:

• Processes
• Extensions
• Data
• Integrations
• Operations

By "Clean" we mean that for each dimension listed above, a set of best practices, methodologies, and tools exist. If these are used, they allow the customer to consider that dimension to be "clean". These best practices, methodologies, and tools are specific for each dimension (and they will be discussed later).

Now that we have an understanding of the individual terms we can put them together:

For clean core, the best case scenario describes an up-to-date system on the latest release, with cloud-compliant extensions and integration, excellent master data quality, and perfect process design. A newly provisioned SAP S/4HANA Cloud system is clean per definition. The goal for the customer in that case is to keep the core clean. For customers who decide on a system conversion or system landscape transformation approach the goal is to get (and then keep) the core clean. New implementations versus system conversions and landscape transformations will be explored in detail in the next lesson.

Watch the video to get an overview of the clean core components.

We have mentioned how SAP S/4HANA Cloud provides a complete solution to the problems modern enterprises face. We can now take this one step further and say that SAP S/4HANA Cloud implemented and operating with a clean core is the goal for customers. This is so fundamental and foundational that when we say SAP S/4HANA Cloud, the phrase "with a clean core" is implied, whether we explicitly say so or not.

SAP S/4HANA Cloud with a clean core allows customers to adapt their systems to changing business requirements and adopt new capabilities.

Diving into more detail some of the identifying features of a clean core are:

• A streamlined and optimized version of SAP S/4HANA Cloud software that focuses solely on essential functionalities and delivers maximum efficiency.
• The removal of unnecessary features, customizations, and complexities to simplify the ERP system's core codebase.
• Enhanced maintainability, reduced technical debt, and improved overall system performance.

Taking these identifying features we can conceptualize them in five easy to remember bullet points:

• Minimalism: The clean core promotes simplicity by identifying and eliminating redundant or obsolete functionalities, ensuring only essential components remain.
• Modularity: It facilitates dividing a complex ERP system into modular components that are loosely coupled, enabling easier maintenance and adaptability.
• Scalability: A clean core architecture allows the ERP system to accommodate growth and change without sacrificing performance or stability.
• Maintainability: By removing unnecessary complexities, it streamlines the codebase, making it easier for developers to understand, modify, or enhance the ERP system.
• Stability and Reliability: A clean core fosters stability by reducing dependencies and making it less prone to bugs and inconsistencies, and improving the system's reliability.

The goal for companies is to "get" the core clean and then to "keep" the core clean.

Imagine a midsized manufacturing company, ABC Manufacturing, seeking to implement an ERP system to streamline its operations. The company has grown rapidly, and its existing fragmented systems have become inefficient and error-prone. The management realizes the need for a robust ERP system to support its evolving needs, and the IT department is asked to handle the implementation. Let's see how ABC Manufacturing can benefit from Clean Core.

As mentioned, some of the challenges ABC Manufacturing is experiencing are:

• Bloated System: The current ERP software that ABC Manufacturing uses is a heavily customized version, with numerous features and functions that are no longer useful or relevant.
• Performance Issues: The system experiences frequent slowdowns, impacting productivity, and causing dissatisfaction among users.
• High Maintenance Cost: The complex codebase requires a considerable amount of effort and resources for regular maintenance and support.

To address the challenges faced by ABC Manufacturing, the IT department decides to evaluate and apply the clean core principles to their ERP system. They determine that by streamlining the software's core components, they can achieve the following long-term benefits:

• Minimalism and Efficiency: By removing redundant features and customizations from the ERP system, ABC Manufacturing can enhance its performance, improving user experience and productivity.
• Scalability and Adaptability: A clean core architecture allows the ERP system to accommodate future growth and changing business needs, minimizing the need for expensive reimplementations.
• Ease of Maintenance: The simplified codebase of a clean core enables quicker bug fixes, reduced downtimes, and effortless customization, thus reducing the overall cost of maintenance.

ABC Manufacturing chooses a system conversion to SAP S/4HANA Cloud private edition. This first step is followed by a transition to SAP S/4HANA Cloud public edition, as a new implementation planned for the midterm (approximately five years).

• For the system conversion, the IT team collaborates closely with various departments, identifying essential functions required to streamline ABC Manufacturing's operations effectively.
• Customizations, add-ons, and third-party integrations that no longer align with the company's long-term goals are removed, resulting in a leaner, more efficient clean core ERP system.
• The clean core implementation strategy follows a modular approach, allowing for better scalability and ease of future enhancements.

Once the system conversion is complete and rolled out to the users, ABC Manufacturing immediately starts reaping the benefits:

• Improved Performance: Through optimization and minimalism, the (now clean) ERP delivers enhanced system response times and user satisfaction.
• Simplified Development: Developers now both understand and work on a streamlined codebase, with improved productivity and reduced development time.
• Enhanced Stability and Reliability: The removal of unnecessary complexities has minimized the risk of bugs and errors, resulting in a more reliable and stable ERP system.
• Cost Reduction: With reduced maintenance efforts, the clean core has resulted in decreased downtime and lower overall maintenance costs.

Based on their experiences in successfully implementing a system conversion ABC Manufacturing has learned the following:

• Conduct a thorough business analysis to identify critical functionalities before embarking on clean core development.
• Employ modular development frameworks and practices to ensure loose coupling and scalability.
• Regularly review and assess the ERP system's performance, identifying opportunities for further optimization and code cleanup.
• Involve stakeholders from different departments to ensure alignment with business goals and requirements.

As with most things, misconceptions sometimes happen especially with concepts that are relatively new. Let's look at a few here, as related to clean core.

• SAP BTP is the only means of making and keeping the core clean. While SAP BTP is necessary for creating side-by-side extensions (the extension dimension of clean core), both key user and developer extensibility (both of which allow extensions to be implemented on stack) are possible with SAP S/4HANA Cloud.
• Clean core is only about custom code and extensibility. Clean core not only affects custom code and extensibility but also business processes, data, integration, and operations.
• Clean Core is only about total cost of ownership (TCO). True, clean core does contribute to a TCO reduction, but it also enables consumption of the latest innovations, as well as contributes to a mindset shift away from on premise and towards cloud.
• Fit-to-standard is the only means of making and keeping the core clean. Although a fit-to-standard system is probably clean, the usage of Tier 1 extensibility options (to be discussed in a later lesson) also make and keep the core clean

In the realm SAP S/4HANA Cloud, clean core plays a pivotal role in achieving efficiency, scalability, and reduced technical debt. By eliminating unnecessary complexities and focusing on essential functions, developers can streamline ERP systems, leading to improved performance, stability, and maintainability. Understanding the business needs for a clean core, illustrated through the scenario of ABC Manufacturing, underscores its significance in ERP implementation. By embracing minimalism, modularity, scalability, and maintainability, developers can build ERP systems that align with business objectives, enhance productivity, and position organizations for growth in a dynamic market.

Having a clean core enables companies to be future ready and competitive at any time.