Understanding the Concept of an Upgrade and an SAP S/4HANA Conversion

Review each term in the following table to learn more about the different types of transitions.

An analysis of approximately 10,000 SAP S/4HANA projects over three years found 48% of projects were system conversions, 50% of projects were new implementations, with the remaining 2% being selective data transitions.

Customers explained that business considerations, including the corporate strategy and degree of planned business transformation weighed heavily in their decisions. Technical factors, such as their existing landscape and the need to retain historical data was also important, in addition to the overall organizational readiness, including the level of sponsorship for the project. The higher the level of sponsorship, the more likely the organization was to choose a greenfield new implementation with full process redesign.

Review the following graphic to explore the important customer decisions when choosing a transition path.

The following table provides a summary of the benefits, technical methodology, desired outcomes, and considerations for each transition options.

*Specific methodology depends on the customer situation.

For customers pursuing a system conversion, the one-step transition path from an SAP ERP system to SAP S/4HANA Cloud Private Edition is the recommended approach, although there are alternative paths that take different starting points into account.

There's also a two-step transition path but it should be carefully considered, because it requires two separate implementation projects.

In addition, the increased complexity increases the transition time, the required system downtime, and cost of the overall implementation.

A new implementation is a brand-new installation of the SAP S/4HANA Cloud Private Edition system to provide a fresh start in a clean system.

The primary steps of a new implementation are:

1. Software Installation: SAP provisions a new SAP S/4HANA instance in the cloud
2. Pre-Configuration Content Activation
   • SAP Best Practices for SAP S/4HANA Cloud Private Edition

     Starting with the predefined business processes enables a customer to get up and running much faster because the process flows, apps, and business roles to complete different job tasks are already defined. It also makes it easier to train users in how to use the new system because the documentation lives in the SAP Signavio Process Navigator Web site. SAP will activate the chosen business processes for one local version. The implementation team is responsible for activating additional countries or regions.

   • Enterprise Management Layer (EML) for SAP S/4HANA

     The EML is a selection of business processes from the master package, SAP Best Practices for SAP S/4HANA Cloud Private Edition, with a focus on multinational companies. The EML is the successor of the SAP Model Company for Multinational Corporations, and includes 43 local versions with a focus on intercompany processes. SAP will install the preconfigured EML package and additional templates can be activated by request for an additional cost.

   • SAP Qualified Partner Packaged Solutions

     Partner-created best-practice templates built on top of empty systems are qualified by SAP to ensure the solutions are proven and repeatable. These qualified partner solutions may address specific industry functionality or niche areas a customer requires on top of the standard SAP best practice business processes.

3. Software Configuration: Enter configuration values to ensure the SAP best-practice business processes function correctly, and make additional customizations and extensions as needed.
4. Initial Data Load: Transfer the business data required to run the new system by loading master and open transactional data from the legacy system. The SAP S/4HANA Migration Cockpit facilitates migration of legacy data to the target SAP S/4HANA system. Two types of data are migrated:
   • Master Data: Core business objects such as activity, cost center, bank master, customer, and supplier.
   • Open Items: Open transactional data such as financial balances, sales orders, and purchase orders.

A system conversion converts an existing SAP ERP system 'as is' into a new SAP S/4HANA system. The primary steps of a system conversion are:

1. Prepare ERP System: Custom code needs to be cleaned up and data volumes should be reduced as much as possible.
2. Database Migration: Data is moved from the legacy database to the SAP S/4HANA database.
3. System Update: The system is updated with new applications and database tables.
4. Data Conversion: The original database tables are converted to the new data model.
5. Software Configuration: Implement SAP S/4HANA mandatory items and simplification items and reuse most of the original business processes.

The Software Update Manager is the tool that facilitates the database migration with Database Migration Option (DMO), software update, and data conversion steps. The Software Update Manager creates a shadow repository on the target database. A shadow system consists of a shadow instance and a shadow repository.

Software Update Manager offers two approaches for a move to hyperscaler: DMOVE2S4 – DMO move to SAP S/4HANA (on hyperscaler) and DMO with System Move. DMOVE2S4 combines three system conversion processes into a single-step procedure: database migration + system update + data conversion. It facilitates migration to new data centers. The functionality reduces complexity, downtime, transition time, and costs of the system conversion by packaging multiple steps together and adding the move from the old servers to new servers in the target hyperscaler. It also offers capabilities for downtime optimization such as downtime-optimized Conversion (doC) and downtime-optimized Database Migration Option (doDMO). To benefit from DMOVE2S4, target SAP S/4HANA is mandatory. Additionally, DMOVE2S4 requires a sufficient network connection as documented in the Database Migration Option guide available at help.sap.com. If these prerequisites can't be met, Software Update Manager offers DMO with System Move.

There are three equally important approaches that you can take to transition from SAP ERP to SAP S/4HANA. One approach is Selective Data Transition. This approach allows you to reduce the amount of data to be migrated using scoping decisions.

Selective data transitioning is an end-to-end, lean process that transitions data from the source system to the target system. It consists of three main phases:

1. Prepare the Source System

   This initial phase focuses on preparing the source system for migration. Activities include reducing the volume of data to streamline the migration process, assessing and analyzing the current state of the system, and making the necessary preparations. These preparations may include simplification items, ensuring customer/vendor integration (CVI) and business partner setups are in place, and performing finance conversion consistency checks to avoid complications during migration.

2. Prepare the Target System

   The next step is to set up the target SAP system. There are two common approaches to do that:

   • Shell Conversion: A shell copy of the source SAP ECC system is created, with reduced or no master and transactional data. Then, the SAP ECC shell system is converted into SAP S/4HANA (on-premise) or SAP S/4HANA Cloud Private Edition using the Software Update Manager.
   • Mix & Match: A new SAP S/4HANA install is created and elements of the existing configuration and ABAP repository are transferred.

3. Perform the Migration

   The final phase is the actual data transformation process.

Leveraging the power of SAP Business Technology Platform, the innovative cloud-based solution provides a guided approach to digital transformation that simplifies the transition from data to the intelligent enterprise.

With a comprehensive end-to-end solution, SAP Business Transformation Center optimizes every phase of the data transformation process, ensuring a seamless transition to a more agile and innovative enterprise.

Positioned as an SaaS cloud solution, this platform offers a comprehensive pathway for organizations seeking digital modernization, functioning as a focal point for all data transformation requirements.

The latest release includes a standardized solution facilitating selective transition from SAP ECC to SAP S/4HANA Cloud Private Edition, as well as to SAP S/4HANA. The introduction of the Lean Selective Data Transition scenario presents users with a swift, efficient, and user-friendly methodology.

This ensures optimal support throughout each phase of the data transformation process. Users can conduct system analysis, define scope, create migration cycles, and execute data transformation based on designated company codes.

Looking ahead, ongoing enhancements are planned to further refine the Lean Selective Data Transition scenario, with the overarching goal of achieving an optimal balance of simplicity, efficiency, and effectiveness.

Find more information here.

• Partners create and use their own tools and products
• SAP does not certify 3rd party products or services for SAP S/4HANA Selective Data Transition
• Inconsistencies or issues which arise from the use of non-SAP tools are not covered by the SAP Support Agreements
• If the third party is not able to fix issues that arise, SAP will try to help, however, this remediation will be a chargeable consulting or support service

A Lift & Shift moves an entire system without change to a new landscape. For example, an SAP S/4HANA on premise system on release 2023 could be moved to SAP S/4HANA Cloud Private Edition on release 2023.

The primary steps to Lift & Shift a system are:

1. Check Prerequisites: Source system must be on a supported release.
2. Provision Target System: Provision new hardware in the new landscape.
3. Transfer the Data: You can use Software Provisioning Manager to back up the current system and restore it on the target system. Alternatively, use the SAP HANA Tenant Copy or Move option for transitions to the private cloud.

The Lift & Shift to the SAP Business Suite cloud is fully orchestrated by the RISE with SAP system transition workbench. In this case, SAP HANA Tenant Copy or Move is SAP’s recommended approach, and SAP HANA Backup and Recovery is available as a fallback. The guided procedures in the workbench fully automate the preparation and execution of the system transfer, including a simplification of the handover procedure to SAP Enterprise Cloud Services.

A database migration converts an existing SAP system running on any database type 'as is' into a new SAP HANA database. The primary steps of an in-place database migration are:

1. Dual-stack Split: If the current system is on an dual stack it must be split into two individual stacks
2. Unicode Conversion: If the current system uses multiple code pages (MDMP) it must be converted to Unicode which defines each character only once.
3. Database Upgrade: The current system must be upgraded to a supported release.
4. Software Upgrade: The current system software must be upgraded to a supported release.
5. Database Migration: Technical migration of current database to SAP HANA.

The executive sponsors on the customer and partner/SAP project teams collectively make up the steering committee. They're responsible for overall project coordination, including critical decisions, budget, resources (employees staffed to the project), and decisions that affect the entire organization. The steering committee is also the last level of escalation, for example if a custom development is required to resolve a requirement.

The project managers on the customer and partner/SAP project teams are responsible for setting up the SAP S/4HANA Cloud implementation project in SAP Cloud ALM. Once set up, SAP Cloud ALM makes the tasks and deliverables from the SAP Activate Methodology road map actionable, meaning they can be assigned to the responsible project team members so that completion can be tracked. In steering committee meetings, the customer and partner/SAP project managers are responsible for delivering status updates using SAP Cloud ALM to run reports on the overall project completion.

The customer system admin (IT Contact) and partner/SAP lead configuration expert work together to get all necessary systems provisioned and permission granted to the relevant team members to access each system.

The partner/SAP line of business (LoB) configuration experts lead fit-to-standard workshops with the corresponding LoB experts from the customer's extended project team. The partner/SAP LoB configuration experts are responsible for documenting important information related to business processes in their LoB area of expertise with the Requirements app in SAP Cloud ALM. In the Realize phase, the documented requirements will be implemented by the partner/SAP LoB configuration experts for the following:

• Entering configuration values in the SAP GUI
• Defining business role customizations
• Building key user in-app extensions using the SAP Fiori apps in SAP S/4HANA Cloud Private Edition
• Defining output management customizations
• Using the capabilities within SAP S/4HANA Cloud to customize relevant analytical apps
• Migrating data for relevant objects
• Setting up SAP Best Practice integrations for business processes that require an integration to function correctly
• Setting up and running test cases and plans in SAP Cloud ALM

Additional technical experts will likely need to be brought into either the customer or partner/SAP project teams to support integration, side-by-side extensibility in SAP Business Technology Platform, and data migration.

SAP's role in SAP S/4HANA Cloud Private Edition is to maintain the base infrastructure and technical infrastructure operations. Application management consulting tasks are done by SAP partners under a separate service contract with the specific partner chosen by a customer. While SAP can also complete these consulting tasks, the strategy for SAP S/4HANA Cloud Private Edition is to focus on partners first for delivery of application services. 

The table provides examples of key service areas and relevant tasks completed by the responsible party.

These services are included in the SAP S/4HANA Cloud Private Edition package and are delivered by SAP. There are no additional fees, as they're included in the overall service package. 

Cloud Application Services (CAS) are a category of supplementary services that may be subject to additional service fees as agreed upon in a customer's contract. CAS excludes all services involving the extension, reduction, or change of the customer's existing landscape (for example, provisioning additional infrastructure resources). SAP may provide CAS services in either proactive or reactive mode. For SAP to provide services in reactive mode, the customer is required to submit CAS service requests via SAP for Me. 

These services aren't covered in the standard services, and can't by covered by the cloud application services. These tasks and services can only be performed by partners or SAP and must be specifically contracted for and itemized in the customer's contract (original or via change request). These services are subject to additional fees, as they can't be performed by customers.

One-off tasks and services that aren't covered by standard services, optional services, or cloud application services. The customer may choose to contract these services through a partner or SAP. These services are subject to additional fees, as they can't be performed by customers.

Can only be performed by the customer and are excluded from standard services, optional services, additional services and cloud application services.