Finance assignment on SAP S/4HANA: The best ERP model
Task: SAP S/4HANA Finance allows an enterprise to create a consolidated view of all operational and financial data to offer flexible and easy reporting along with automation of processes. It also offers real-time analytics, simulations and forecasting with a great user experience. Benefits of SAP S/4HANA include but is not limited to ‘single source of truth, faster forecasting and planning, ‘on the fly capacities’, new reporting and analytic support, global regulatory and compliance abilities across all languages, currencies and industries, faster month closing, integrated with Fiori etc.
Discuss these statements using case study examples (from literature searches) to demonstrate the benefits of SAP S/4HANA Finance.
Your paper should include the following areas :
- A brief historical overview of SAP S/4HANA Finance
- The difference between SAP S/4HANA Finance and current SAP ERP FICO
- What are the benefits of SAP S/4HANA Finance for businesses
- Case Studies of companies and the issues they faced migrating to SAP S/4HANA Finance. (Minimum 2)
- Illustrations, frameworks, figures and tables as necessary to demonstrate the understanding of the above aspects.
The Finance Assignment emphasizes on the utilization of the mediums of SAP/ HANA finances for businesses towards developing a strong perspective for the operational data in the business in order to provide flexibility with the use of autorotation and a simpler user interface. SAP S/ 4HANA also render real time data, forecasting and along with this enhance user experience. SAP S/4HANA includes a vast range of benefits, which is, provides to the business such as revolutionizing the business methods with intelligent automation, which would be supported by AI. This also aids in taking better decisions with the help of embedded analysis such as digital assistants. In this report, the study is going to focus on the differences that exist in the SAP S/4HANA and SAP ERP FICO and the benefits, which it provides to the business. Along with this, various case studies will also be considered which would highlight problems that are being currently focused.
Background of SAP S/4HANA finance
The SAP simple finance is the previous name of SAP S/ 4HANA was which included different existing as well as updated traits such as real-time or analytical basis, streamline based designs and also on the journals. The new SAP module is a great instance for the finance model, which has undergone the designing aspects in the SAP S/4HANA suite for maximizing the efficiency in the processes involved in the entire lifecycle of the asset (Salmon and Wild, 2016). The SAP The SAP HANA database offers the SAP ERP 6.0 suite to work efficiently on its database. The post initiation of the software during the year 2014, the confusions and various perplexities had mostly become a part of the products those were located. Different people such as the SAP customers were also present and involved in the confusion. They thought that is particular new model would become a new way of finance accounting and controlling, which would eventually helps to make the process a bit easier in this initial moment. Thus, it is considered as better decision of discussing the SAP ERP 6.o which accrues the total ability of maintaining the HANA database (Eifler and Theis, 2017). There are also certain main components of the previous FI/CO suite, which have undergone recoding which would the users to take the all benefit of the SAP HANA’s potential. The four basic elements of SAP S/ 4HANA discussed in this Finance assignment are:
- The core component: SAP offers different financial as well as improvements, which is considered, is the function or as a core element of the SAP S/4HANA. For this, at least one SAP Net weaver 7.4, SAP ERP central part ECC, SAP HANA version 1.0 and others such as Enhancement Package 7 are considered the vital parts, which would help in the easy migration to the S/4HANA (Islam, 2019). The migration to ECC 6.0 to S/4HANA is considered a core updation, which majorly involves the migration of the transactional tables.
- The UX component: SAP S/4HANA is placed on the SAP Fiori GUI element, which will help the uses for seamless interaction with the core element with the help of user-friendly Fiori display. For this, the following are required namely SAP Net Weaver 7.4 and the SAP Gateway Version 2.0 (Salmon, 2018). It is to be noted in this Finance assignment that the above two are considered as an optional element and the users can easily go along with the existing SAP GUI or Net Weaver Business customer.
- The reporting component: This particular component helps the business to get the real time as well as the reporting analytics data through the prepackaged HANA live. There are certain essential elements, which are required for the installation namely SAP HANA 1.0 and SAP HANA based on the ERP model.
- The application component: This element is the collection of the collaboration of the various applications, which are particularly placed on the finance model. This is an urgent need for the crucial decision makers of the business firms.
Requirement table for Core component
SAP S/4HANA Requirements in numbers
SAP Net weaver 7.4
SAP ERP central part ECC
SAP HANA version 1.0
Compare SAP S/4HANA finance and current SAP ERP FICO
SAP S/4 HANA is considered as the new digital part as well as direct evolution from SAP ECC for the current customers. SAP has now been offering many attractive discounts for nudging the adoption to a forward place. However, there is not a direct substitution for SAP ERP in terms of functionalities as well as the capabilities. The following are the major changes provided in this Finance assignment that have been observed in the SAP S/4HANA in comparison to the SAP ECC ERP
- A new database: The introduction of a completely new database platform SAP HANA has resulted in faster data analytics and the elimination of the less required tables. The changes in the architecture have also introduced new methods for effective working with the data. Along with this, SAP has also transformed the physical data structure thus; unification can seamlessly be done regarding the previous accounting ledgers into a sole physical table, which is commonly known as the universal journal (Riesner and Sauer, 2017). Through this, fast probability examination can be done in a more effective manner. The rest of the functional capabilities such as the logistics can also undergo such enhancements.
- Functional changes
- Removal of duplicate functions: SAP ECC consisted of general ledgers model whereas SAP S/4HANA applies the current General Ledger Accounting model, which is applied automatically in reference to the S4 HANA migration. SAP S/4HANA has also EWM functionality incorporated into the root system rather than having a completely different SCM system as seen in ECC.
- Much of the functionalities is not replaced in SAP S/ 4HANA: SAP has also confirmed that there would not be any major replacement in S/4HANA. The cases, which have been observed in SAP ECC will be similar in case of S/4HANA. However, the organizations that are opting for migration to the S/4HANA will certainly have the process that would be completely obsolete.
- New function abilities: It is mentioned within the study of Finance assignment that SAP is currently releasing various new functionalities, which would be especially designee to effectively work with SAP S/4HANA and also in memory computation. The chief instances for this involve the SAP Cash, Management, and SAP BPC Optimized for S/4HANA.
Architecture of SAP S/4HANA and SAP ERP FICO
(Source: Sampat, 2016)
The most important Functional elements in terms of SAP ERP central is the SAP ERP FI/CO which provides permissions to the organizations to get all the data related to the finance. The SAP FICO aims at helping the organization to produce and manage statements related to the financial reports and the determination of the decisions related to the effective planning of the management for the concerned organization. In general, two formats are basically outlined for the SAP FICO which has SAP controlling as well as SAP finance which finds its separate usage in the finance processes. The SAP CO focuses around the costs related to the planning as well as administering (Sampat, 2016). On the other hand, SAP FI aims at the total accounting and finance reports. SAP S/4HNA, which is the updated version of SAP HANA, refers to memory database, which supports in the processing as well as the storage of data. Based on costing in accounting, the primary as well as secondary element is defined for the general ledger of the accounting data. The SAP S/4HANA involves the capabilities regarding the ERP, which is quite well-known across the globe in terms of finance procurement, sales and many such. It develops a platform that fosters the financial solutions. The architecture explored in the present study of Finance assignment involves the following:
- Providing secured data in the universal journal
- Offering main finance to gather the data from different sources
- Demonstrating perspective regarding the financial data.
Advantages of SAP S/4HANA Finance for businesses
SAP S/ 4HANA is the successful ERP system of SAP and the primary which its provides is its unique architecture which is in complete contrast to the traditional relational database. The software runs in the memory with the help of the data, which is stored in it, which allows faster as well as to active real time analysis and computational abilities (Chowdhury and Nayeem, 2017). This also allows the organizations to work smoothly in a digital market, which is considered as the key element for driving the various businesses through the SAP ERP software in these years. SAP S/4HANA has been specially designed for the SAP/ HANA platform and is advancing itr5s ways towards the simplifications, improved efficiency, and along with these new incredible features. Moreover, it also provides some of the unique advantages to the business stakeholder are right from the reduction in the costs to enable the business for a digitized core. There exists a plethora of benefits which is offered by SAP S/4HANA for the business operations
- Simplification: SAP S/4HANA helps in bringing a huge simplification for the magnet as well as the administration related to the IT landscape. This particular feature discussed in this Finance assignment is considered as the key element, which is responsible for bringing this to the ECC application structure. This also allows the centralization of the network resources as well as the hardware has and act as a digital code for the effective business operations (Hwang, 2018). This is achieved by harnessing the power, which exists in the HANA memory database. Before this, the organizations often faced issues regarding the several batch run dependencies. After the removal of the tables, the processing time for the business operations was solved.
- Ease of use: Fiori 2.0 offers an amazing design for an enhanced and innovative user experience which enables the users for accessing the overview pages, list reports. SAP Fiori’s UI is developed specially to provide greater intuitive, responsive as well as personalized experience. This lets the users to prompt questions and get access to the required details, which is independent of the device or its deployment. Along with this, this also lets the organizations to constantly evolve and consequently achieve new resources and revenues. Added to this, customer interaction will also increase to greater level, and IoT as well as Big Data can be accessed easily and most importantly, relevant insights into any data can be achieved with the help of real time data analytics.
- Enhances the performance: SAP S/4HANA explored in this Finance assignment provides increased performance and also lets the business owners to plan, execute as well as generate analytics based on real time data. Moreover, the businessperson can also help in activating period closing as well as offers enhanced decision. Added to these, it also allows the business organizations to offer better services for the customer’s oriented applications. Along with this, the software (Kulkarni, 2019) also offers contextual awareness and data accessibility. SAP S/4HANA only operates on the SAP HANA flagship in its inbuilt memory database which means that while running a SAP software it generally take the benefit of the transaction speed as well as reports native to SAP / 4HANA.
- Innovation: The application software also offers a platform for future innovations. On a daily basis, the technology is evolving and thus, it is important to keep pace with the growing technologies. The organizations are staying ahead of the digitization curve and helps in making decisions which are ready for the future. The software, which redeveloped on the SAP S/4HANA platforms, increases the speed of operations, aids in contextualization of the data and also provides accessibility. They also opt for the cloud adoption since it offers the organizations for delivering effective and innovative solutions.
- Effectiveness of cash involved: The SAP S/4HANA is considered as a smart action with respect to the cost efficiency is concerned. It provides the business operations to collaborate the analytical as well as the transaction facilities of various systems in a single location. This helps the business to take better and informed decisions which assists in the overall growth of the business.
- Effective migration from on-premise to the cloud: This is considered as the most relevant benefit of the application as it renders easy transition to the cloud platform. As the transition to the cloud can occur within the company, so it is a crucial advantage for the business owners to consider. However, the adoption of the software is not at all a simple move and with just the basic comprehension of the benefits that SAP S/4 HANA provides does not pave the way for the successful adoption. For adopting the software in the business, it is important to undergo deep thought, careful evaluation regarding the benefits it can provide for the concerned organizations.
- Analysis and planning of finance: This is also considered as the vital decision in the analysis of finance in the company, which contributes a lot to the huge development cycle of planning as well as creation of profit making issue in terms of finance functionalities. The main problems discussed in this Finance assignment which are majorly faced, include the copying of data that can be easily prevented. The clients, which are associated with the organization, can easily collaborate their planning’s and applies the data, which is operated on a timely basis (Chuprunov, 2018). This would be extremely useful for eliminating the shortages of timings and the data, which is no longer in use. In the entire life cycle of finance, the updation, the creation always play a critical role in the organization firm.
Benefits of SAP S/4HANA
(Source: Chuprunov, 2018)
The organization is held responsible for improving the consent as well as managing, minimization of the workloads, and the different amount involved in a quick and effective manner. The SAP accounting collaborates the management and finances with the profit information in a single journal namely Universal journal.
Benefits of SAP S/4 HANA
(Source: Chuprunov, 2018)
Case Studies of companies and issues they faced migrating to SAP S/4HANA Finance
Finance Assignment Case Study 1: Kellogg’s:- The most popular organization has been applied the SAP S/4HANA throughout its body. Kellogg’s company deployed on premise for keeping a close eye on the trade spends and along with this, they created certain complex data simulation for analyzing the classical relational database. By 2013, the classical database of the company became quite inefficient meet the requirements. This could only do the simulations at a single time with respect to the timely predictions, which based on the promotional activities generated profits for the company. Thus, it was important for the company to opt for a faster solution in the form of data cloud system. The company adopted SAP S/4HANA, which was provided by AWS (Jha and Sangle, 2019). The implementation SAP accelerated the TPM solutions, which could adjust various terabytes of data. Along with this, the data can also be scaled as per the needs of the company infrastructure. This solution addressed the costs involved to a minimal level, thus the users can easily segregate the information and examine the sales operations in every department. The company has also moved their setup to the cloud platform, which has benefited it in various ways. Along with this, the company is also being able to save millions by minimizing their trade spend as now they can operate the data in multiple data calculation concurrently. The use of SAP HANA on the cloud premise has provided the company with many additional memory database and computational capabilities. Moreover, it has also used several AWS instances for the effective SAP applications and HANA database schemas.
Finance assignment CASE STUDY 2: Shire:- Shire is well known Biotech Company, which is mainly, focuses on the specialized condition and diseases. The company is based in Dublin, Ireland with employee strength of around 24,000. Along with this, the company generates around $16.3 billion US dollar as of the year 2017 (Kulkarni, 2019). The organization wanted to collaborate its IT systems after the phase of rapid growth was over. In addition to this, the company also wanted to migrate to SAP HANA from Oracle database. The company desired these transitions, as they wanted to make their IT systems much more structured and organized. This would aid the company in operating efficiently as well as focusing on the rare disease management. The diverse IT systems which has been developed is for both the SAP as well as Non -SAP systems (Ç?nar and Ozorhon, 2018). The organization needs the integration of the systems into a single powerful IT system and transitioning the several databases into the SAP HANA database. With the SAP integration, the performance of firm has improved significantly. This helped in the creation of effective IT foundation, which also helped the people suffering from rare diseases. Shire has collaborated the IT systems and the SAP HANA memory database has enabled the business owners to assess and examine the data. This would assist in managing innovations and many relevant discoveries in the area of rare disease management and its medication. The SAP HANA migration has offered a support system to the health checkups and also at the same time ensured the minimization of risk.
Along with this, the organization a los received complete support from SAP Enterprise Support team at the time of collaboration. The team also provided support even after the collaboration was over for the issue resolving. Moreover, the firm also acknowledges SAP HANA because of its analytics capabilities, high-speed transactions and its guided analytics.
The SAP S/4HANA is the best ERP model explored in this Finance Assignment which is provided by SAP in the current market. It offers an exclusive product suite, which is in synchronized with the new applications such as SaaS from the success factors and IoT projects. The SAP HANA cloud platforms also allow the easy implementation of the extensions, which help in the effective incorporation of the extensions in other applications. The new product will certainly provide competitive benefit in low prices. Along with this, the SAP also observed a drastic enhancement in the SAP S/4HANA project. The activities of SAP involve the installation of innovative measures while operating the business. There are two companies, which have been considered for the case study. The two case studies revealed contrasting characteristics regarding the transition of SAP S/4HANA.
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