The complexity of SAP needs no introduction.
However, S/4HANA has added several new layers of complexity
and if you are not immersed in it, it may seem impossible
that you will ever get to grips with it. Never fear! If
this is you, then read on
I once heard an SAP professional describing
SAP as nothing more than a concoction of inter-related
apps. In some ways, he had a point. SAP has, in recent
years, undergone a very aggressive policy of swallowing
up competitors in the market place, or expanding their footprint
into new markets via acquisitions of other organizations.
Since 1991, SAP have acquired 67 other companies. Some of
those have been embedded nicely into the SAP ecosystem,
such as Success Factors (acquired by SAP in 2011 at a cost
of $3.4 billion). However, others are not yet so deeply
embedded and can lead to some sympathy with our SAP professional
who bemoaned the overall SAP landscape.
The year 2018 marked the peak of SAP acquisition
activity with five major acquisitions including experience
data platform Qualtrics for $8 billion and the cloud based
quote to cash solution Callidus Cloud for $2.4 billion.
Since then, SAP have pegged back their acquisitions
in favour of bedding down their existing solutions. This
has come as a relief to many SAP architects who have spent
recent years scrambling to keep abreast of all the new acquisitions
However, the SAP landscape of ECC6.0 still
looks pretty straightforward when you compare it to the
deployment options of S/4HANA, as shown in this diagram
(provided by SAP SE). Lots of applications all connected
with each other, some of which are now embedded into S/4HANA
and some are not.
So how do you make sense of it all? If you are an SAP Order
to Cash consultant, whose career has been nurtured in the
loving and largely predictable world of ECC6.0 and R/3,
then how do you learn those new skills you now need to apply
yourself to an SAP world increasingly dominated by the looming
shadow of S/4HANA?
Its not possible in one blog to give
you all this information, so if you need more than a high
level overview, please look at the Further Reading section
at the end to see where to get full information on these
Firstly, you must familiarise yourself with
the S/4HANA terminology. This terminology is not going away
and more and more it is becoming an integral part of any
SAP S/4HANA implementation, so ignore it at your peril.
Lets start with some
HANA. What is HANA? At its most basic definition,
HANA is a database. You might be used to Oracle or Linux
providing your underlying database where all your master
data and transactional data sits, but SAP are firmly in
the game now, with HANA (acronym is short for High Performance
S/4. This is short for Suite For,
therefore S/4HANA is Suite For HANA very
different from Suite On HANA, which usually
refers to an ECC6.0 system which runs on a HANA database.
The difference is important ECC6.0 can run on any
database, whereas S/4 can only run on HANA.
And what is Fiori?
This is the latest and greatest user experience
in the new S/4HANA world, through which your users on S/4HANA
will interact with SAP. It is a web-based portal with analytical,
factsheet and transactional apps, all laid out in an easy
to use and customisable manner. For Order to Cash users,
Fiori is pretty much essential (yes, I know, there will
be plenty of S/4HANA customers out there who still use the
SAP GUI, but believe me, you are missing out!).
So now on to the Order to Cash innovations,
which you will need to explore and become conversant with
in order to be able to brand yourself an S/4HANA OTC Consultant.
Ill lay these out in a list with a very brief introduction
for each. More on how to get greater detailed information
on these can be found in the Further Reading section at
the bottom of the blog.
the Fiori UX is vital for Order to Cash and can be a real
game changer for sales and distribution users. Key apps
such as My Sales Overview, Sales Management
Overview and Sales Order Fulfilment offer
never before seen out-of-the-box insights into issues in
the supply chain, with full drill down capabilities.
Business partner the
concepts of business partner is not new to S/4HANA, but
now it is mandated. No more customer, vendors and contacts
all are now unified in the one data object: Business
Partner. This allows elimination of redundant data and smoother
interfaces with connected systems such as CRM.
rebates are a pain arent they? And there are
SD rebates with customers and MM rebates with suppliers.
These are now redundant completely and have been replaced
by the much more flexible approach around Settlement Management,
where you can handle all your customer and supplier rebates
in one unified tool.
pricing tables in S/4HANA have been simplified. Table PRCD_ELEMENTS
has been introduced to replace table KONV this is
essentially a tidy up by SAP with an associated improvement
in system performance.
BRF+ for outputs
again, this has been around before S/4HANA, but the
default output management is now through BRF+ in S/4HANA.
The approach is very different from the NAST approach to
outputs, and provides a web based portal to manage outputs.
This is in response to complaints of inflexibility in the
NAST approach. BRF+ is an all-encompassing tool where business
rules can be defined to drive specific outcomes, like outputs.
Very powerful, but complex.
Credit Management this
is a significant change in S/4HANA. Previously in ECC6.0,
this was housed under the SD configuration, but in S/4HANA,
this has moved to the Financial Supply Chain Management
section. As a result, this would be a collaboration with
your FICO colleagues to get this set up. This change is
not optional you need to become familiar with the
new credit management functionality in S/4HANA as a prerequisite
to running credit management in SAP. The reason why it has
changed is pretty much the same as the other simplifications
around S/4HANA greater flexibility, automation of
processes and elimination of redundant data.
Revenue Accounting and
Reporting revenue recognition was very simple
in ECC6.0 SD: you just amended a setting against the item
category to trigger milestone or periodic revenue recognition
and then posted the rev rec by using VF44. Then everything
changed in 2014 when the IFRS (International Financial Reporting
Standards) introduced IFRS 15 in association with US GAAP
(Generally Accepted Accounting Principles). These principles
became mandatory in the US and much of Europe in 2018 and
SAP overhauled its revenue recognition offering as a result.
What this means for S/4HANA is that it is not possible to
use the old rev rec settings any more for revenue
recognition, the new Revenue Accounting and Reporting must
be followed; RAR can also be downloaded for ECC6.0 if above
enhancement pack 5. This is a big change for SAP and the
approach follows five steps as laid out in the diagram below.
You would need to discuss RAR with your FICO colleagues
to get it set up in configuration. A word of warning
do not underestimate the time needed to get this done!
Advanced Available to Promise
ATP has been around since the dawn of SAP, but with
S/4HANA comes the optional extension aATP this does
require an additional license cost.
The settings are split into five potential
buckets, as displayed in the diagram below. You can slot
different customers according to freely defined attributes
into each of the five buckets. This gives you a far more
flexible approach to ATP than was previously possible.
Foreign Trade foreign
trade settings in SD are no longer required in S/4HANA.
SAP has moved all of these settings into its additional
application Global Trade Services (GTS). However,
many of the functions are still available in core S/4HANA
but in a completely different solution. The settings around
International Trade (legal control, embargos, intrastat
and integration with SAP Watch List screening) can be found
under the customising menu for Governance, Risk and Compliance.
Please note however, that once you have set these customising
settings up, the maintenance of the international trade
settings is carried out exclusively in Fiori apps, not in
the SAP GUI.
Table changes and deprecated
transactions many database tables have been
simplified or eliminated in S/4HANA. The most important
change here is the elimination of the need for the VBUK
and VBUP tables, the fields of which have been moved to
VBAK and VBAP.
There are many deprecated transactions in S/4HANA too. The
most obvious are the old customer and vendor transactions
such as XD01 and XK01. A full list is available by using
table PRGN_CORR2 in SE16N.
To get more information on these changes, including an S/4
overview, and an introduction on how to customise each section
as well as a view of additional S/4HANA simplifications
(such as the replacement of LSMW and the extension of the
material number field) please download the eBook The
No Nonsense Introductory Guide to Order to Cash Changes
in S/4HANA From ECC6.0.