There is a myriad of key differences between SAP R/3 and S/4HANA that many operations in the retail industry still have trouble understanding. It’s a topic that continues to receive a lot of attention, and since these two systems can uniquely impact your business in their own ways, there’s a lot to unpack. While both SAP R/3 and S/4HANA are both enterprise resource planning systems (ERPs), their backend functionalities have inherently different approaches and outcomes, mainly in how they can process data — which can dramatically affect your bottom line.
In this article we will look at:
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- What’s the Difference Between SAP R/3 and SAP S/4HANA?
- How has the technology evolved from SAP R/3 to S/4HANA and what benefits does this offer businesses?
- What specific functions and performance features make S/4HANA a superior solution compared to SAP R/3?
- What is the transition from SAP R/3 to S/4HANA like and what impact does it have on companies in terms of efficiency, business processes and competitiveness?
What’s the Difference Between SAP R/3 and SAP S/4HANA?
SAP R/3 was introduced in 1992 and was a benchmark system that has since been renamed SAP ERP and uses a three-tiered structure of the database, the application server and the user interface. Meanwhile, S/4HANA was introduced in 2015, which can leverage the cloud and uses the HANA database. In a nutshell, S/4HANA is a real-time ERP system, mainly due to the fact that it’s column-oriented, which makes it far easier to be read quickly when analyzing larger sets of data versus the SAP R/3 database which is organized in rows. Yes, S/4 HANA is oriented much differently than what some users may have been used to with legacy systems. However, now that data has become a much more significant component of business administration — with sources of it being fed in from every aspect of the operation — the ability to scan and analyze that data effectively becomes mission-critical to overall operations.
How has the technology evolved from SAP R/3 to S/4HANA and what benefits does this offer businesses?
As technology continues to evolve, the retail industry needs to continue its commitment to staying technologically savvy, and as such, the legacy platforms like SAP R/3 are revealing their outdated operability. With the introduction of S/4HANA, SAP has created a new generation of ERP systems based on the in-memory computing platform. This enables real-time analytics and significantly accelerates business processes. Further, companies can reap the benefits of improved performance, simplified data processing and increased flexibility. In a data-driven world, equipping your operation with best-in-class data analytics capabilities can not only streamline your processes but can boost profitability as well.
What specific functions and performance features make S/4HANA a superior solution compared to SAP R/3?
S/4HANA offers a variety of features and performance characteristics that simply make it a superior solution compared to SAP R/3. These include simplified data modeling, improved reporting, and extensive integration with other SAP solutions. In addition, S/4HANA enables seamless integration of real-time analytics and machine learning, which helps companies make informed decisions and develop innovative business models. Regardless of how complex data analyses are, whether it’s monitoring inventory levels of retail consumer goods or collating global sales figures, S/4HANA can process it all in real-time while avoiding redundant data and simplifying the system landscape unlike ever before.
What is the transition from SAP R/3 to S/4HANA like and what impact does it have on companies in terms of efficiency, business processes and competitiveness?
Moving from SAP R/3 to S/4HANA requires careful planning and implementation. Companies must analyze their existing systems, migrate data and adapt their business processes to the new functions of S/4HANA. This process can be time-consuming and complex, but at the same time offers the opportunity to optimize business processes and increase efficiency. By moving to S/4HANA, companies can strengthen their competitiveness by benefiting from improved functionality and performance features. Real-time analytics and machine learning integration enable better decision-making and help companies identify new business opportunities.
Companies in trade and consumer industries are facing mounting challenges, from new competitors, including channel partners that are leveraging private label products, to more informed consumers amidst a changing digital landscape along with market volatility and rising costs. These businesses can turn to S/4HANA to give them a stronger foundation with better flexibility and an intelligent advantage to improve and innovate their services to stay up to speed.
Suffice it to say, moving to S/4HANA is a positive, strategic decision that can provide long-term benefits to retail industry businesses of all sizes. However, it is important that companies conduct a comprehensive analysis and enlist the support of an experienced IT consulting firm to ensure a smooth transition.
At gicom, we provide the latest technology, innovative solutions and comprehensive services as a global leader for all processes related to your agreements, margins and profitability. We can help your operation implement S/4HANA quickly and efficiently to improve your overall profitability.
Ready to discover more about how gicom can help your company thrive while transitioning to S/4HANA?
Contact our Expert
Jan Pötter, Head of SAP Transformation Management
E-Mail: jan.poetter@gicom-group.com
LinkedIn: Jan Pötter