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The Importance of Strategic Data Management in the Face of SAP ECC Support Ending

29 February 2024
Ida Lorenz

The announcement that SAP ECC will no longer be supported has been a wake-up call for organizations. Those using SAP ECC 6.0 are now at a critical juncture. It is time to consider migrating to the latest version, S/4HANA, or exploring alternative solutions. While 2027 (or 2030 with extended paid support) may seem a long way off, the effort involved in migrating data and transforming business processes should not be underestimated.

Rethinking ERP strategy also presents a unique opportunity over the next few years to re-evaluate and optimize long-standing processes and position the business in the best possible position for the future. But what exactly does this shift entail? Let's take a closer look at the implications of the end of support for SAP ECC and how organizations should respond.

Recommendations at a Glance

  • Allocate sufficient time for requirements analysis and preparation, including processes.
  • Plan and execute data cleansing in the legacy system, not the new system, and identify “active” and “passive” data early.
  • Ensure close collaboration between business and IT from the outset.
Abschaffung des Supports für SAP ECC: Warum strategisches Datenmanagement jetzt entscheidend ist

The Importance of SAP ECC and the Challenge Ahead

SAP's enterprise resource planning (ERP) system, ECC, is one of the world's most widely used ERP systems. SAP ECC has long served as the IT backbone for many companies, managing and optimizing business processes ranging from finance to supply chain. However, with the upcoming end of support for SAP Business Suite 7, which includes SAP ECC 6.0, companies face the challenge of modernizing their ERP systems and migrating to future-proof, cloud-based solutions such as SAP S/4HANA. This transition requires a technology shift and a strategic realignment of how enterprise data is handled.

Transformation initiatives are large and complex projects – and not just for IT. In addition to impacting day-to-day operations, they pose significant financial risks to the business. Key personnel and knowledge holders from all departments – especially much of IT – will find their capacity tied up for months if not years.

You must make fundamental strategic decisions before moving to the new SAP S/4HANA system. In our view, simply migrating to another ERP system (even if it is now cloud-based) is not enough to get the most out of an ERP modernization program. Here are some reasons why a modern ERP system alone may not deliver the desired benefits:

  1. ERP systems such as SAP S/4HANA have predefined data models and structures. Managing master data in such systems requires extensive customization of the capture and editing processes, as well as physical transformation of the data into the new data structure. The migration can be complex and requires thorough planning. This ensures that data, configurations, and custom developments are scrutinized and either replaced or reimplemented.
  2. ERP systems provide integrated functionality across multiple business functions. Integrating data from disparate sources and presenting a comprehensive view of master data within an ERP system is a significant challenge. It is critical to ensure that all data is adequately migrated and remains consistent and complete after migration – this is where data governance comes in.
  3. ERP systems support functions such as business intelligence or advanced analytics. However, the success of these outcomes depends heavily on the quality and consistency of the data within the systems. Capabilities such as data governance and data quality management are required to ensure that data is appropriately managed and stored throughout its lifecycle​​.
  4. Migrating to cloud-based solutions involves significant costs, including licensing fees, implementation costs, training costs, and ongoing operational costs. Organizations must carefully plan their budgets and resources and ensure that the impact of the migration is considered correctly.

Live-Event

Upcoming Event on March 19 in Utrecht (Netherlands) With Our Partner Informatica
ERP Modernization: How to Reduce the Risks of Switching to New Platforms (e.g. SAP S/4HANA)

Together, we'll demonstrate how a centralized MDM solution can simplify the migration process, ensure a smooth transition, and ensure successful operations.

 

The Key to a Smooth Transition from SAP ERP to S/4 HANA

End-of-support alerts companies to re-evaluate their ERP strategy and prepare for the future. However, time is of the essence, and many are still determining how best to manage the transition.

Cloud modernization is a critical step for many organizations looking to optimize and increase the agility of their IT infrastructure. Data-related issues play a crucial role. A solid data strategy is vital to realizing the full potential of the cloud while ensuring data integrity, security, and compliance.

Today's enterprise IT landscape is highly heterogeneous. The data platform of the future must be flexible, scalable, and agile to meet ever-increasing data demands. It must not only manage data but also analyze, integrate, and deliver it in real time. A solid data strategy defines clear goals, processes, and accountabilities. It must also consider interactions with digital innovations such as artificial intelligence, which likewise influence the project setup.

S4/HANA Migration Project Management Sequence Recommendation
S4/HANA Migration Project Management Sequence Recommendation

Migrating to SAP S/4 HANA or other cloud-based ERP solutions is a critical step for many companies to modernize and future-proof their systems, business processes, and data foundation.

During data migration, it's critical to maintain the consistency and integrity of your data to ensure a smooth transfer to the new system and continue to provide and maintain high-quality data.

Enterprise Resource Planning is the backbone of many organizations. However, a comprehensive data strategy encompasses not only the ERP system itself but also tools such as master data management (MDM) and data quality (DQ), as well as various other systems that interface with it. These include customer relationship management (CRM), product information management (PIM), supplier relationship management (SRM), and marketplace platforms (e.g., Ariba). Connecting to external cloud systems is essential for seamless business process integration post-transformation.

Turning SAP Migration Into an Opportunity With Strategic Data Management

In a world where data is increasingly becoming a company's most valuable asset, strategic data management is essential, especially in the context of a successful migration from SAP ECC to future-proof ERP solutions such as SAP S/4HANA.

ERP SAP Modernization Best Practices

  • Conduct a comprehensive inventory of your data landscape to identify potential bottlenecks and challenges.
  • Define clear goals and requirements for your ERP migration and derive your data strategy.
  • Data cleansing is significant and time-consuming and should be started as early as possible. Be bold! Every duplicate and obsolete record you delete pays for itself in saved effort and resources.
  • Change management is critical to the transformation's ultimate acceptance and timely success. Engage stakeholders who work with the data today.
  •  Invest in the right data management tools and technologies that best meet your needs. SAP S/4HANA is available as both an on-premise and a cloud solution. You should choose the deployment option that best meets your business objectives.
  • Continually train your employees in data handling and raise their awareness of the importance of data quality, protection, and security because implementing the ERP system is not just a technical task. It brings change and innovation to many parts of the organization.
  • Talk to external service providers and business consultants who can provide comprehensive support with business and technical expertise – from strategic planning to technical implementation.
  • Get started now! Your company will benefit later in the form of saved licensing costs. Don't spend money on value you don't use.

Transitioning from SAP ECC to an Agile and Resilient IT Infrastructure

Strategic data management is not a luxury but an absolute necessity to meet ever-increasing demands. Companies that cling to outdated technologies risk falling behind the competition, missing out on technology innovations, and being overwhelmed by future business challenges.

Free support for SAP ECC 6.0 ends at the end of 2027. Three years later, at the end of 2030, even extended paid support will end for good. For Business Suite 7 customers, it's time to plan for the transition, as the data cleansing effort should not be underestimated.

Rethink your ERP strategy and prepare for the future. Migrating data to the cloud and integrating cloud-based solutions into your enterprise architecture requires careful planning and skilled execution to ensure data integrity, security, and compliance.

Thorsten Löwer from Parsionate

Thorsten Löwer is a strategy consultant at Parsionate and has been involved in SAP projects with a focus on master data and everything related (data governance, MDM, data cleansing, data migration, lifecycle, processes) for more than 15 years. He has accompanied numerous data projects and knows the practical requirements and challenges they pose to the organization in the SAP environment.

Meet Thorsten Löwer at our event in Utrecht, the Netherlands, on June 04 to discuss your unique SAP migration challenges.

Click here to register

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