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SAP ERP vs. SAP S/4HANA: Choosing the Right Solution
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SAP ERP vs. SAP S/4HANA: Choosing the Right Solution for Your Business

Are you feeling confused between SAP ERP and SAP S/4HANA? It is a complicated and extensive topic. Therefore, you need to consider everything carefully, before deciding the most suitable one.

ERP or enterprise resource planning, is one of the most vital aspects of any organization these days. To maintain proper order and functions of the business process, different programs, apps and software are used and SAP ERP is one of them. It is a discreet ERP solution that offers assistance with business management apps for every operation area under one umbrella. Therefore, if you are looking for ERP Implementation it is vital to gain a better understanding of the topic.

When you implement ERP within your organization, it helps elevate operational visibility, supports sustainable business growth and gains better efficiency resulting in achieving your business goals and objectives.

Delving into the details for a better understanding

Now that the idea about ERP and what it does has become a little clearer, it is time to explore other aspects and variations of the software. For example, the focus now will be on SAP S/4HANA. The first thing in this context is to know what SAP S/4HANA is. It is a comprehensive ERP solution designed to support large, enterprise-level organizations in different industries. ERP helps businesses manage its most pressing challenges through its various ready-to-work processes. SAP S/4HANA comes with automatic updates ensuring that your system remains up-to-date and synced with the latest industry developments. It also comes with AI and ML for smoother running of your business and maximum efficiency. Hiring SAP consulting services can help you here.

A comprehensive analysis of the pros of SAP S/4HANA and SAP ERP  

When you have the analysis of two programs readily available, it helps you to evaluate the merits and demerits of implementing both. As a result, you can decide which one suits you better and make a decision. For example, here you will get to know about the pros and cons of ERP and SAP Implementation. Based on that information, you will be able to decide the best choice for your business, helping you enjoy the benefits. The analysis of these two programs will give you the following advantages:

  1. Equipe you with a standardized collection of attributes and functionalities that should be anticipated within a discrete ERP system.
  2. Assist you in constructing a condensed list of potential discrete ERP solutions that align with your business’s priorities and goals.
  3. Offer a data-driven analysis that will sidestep vendor bias. The report is built on years of accumulated data, and as a result, it diverges from routine vendor marketing materials.

The comparison between SAP S/4HANA and SAP ERP

SAP ERP and SAP S/4HANA can be segmented into eight primary business modules, depicting the level of support each discrete ERP offers. The functionalities of numerous rival ERP solutions and consolidated reports of their features to construct a model of the typical capabilities of discrete ERPs can be clearly seen through these details. These details will not only help with a comparison between SAP ERP and S/4HANA but also in the broader market. SAP ERP and SAP S/4HANA’s performance unfolds as follows:

Financials

SAP ERP encompasses a comprehensive financial management and accounting module and holds a slight edge over SAP S/4HANA. However, it’s noteworthy that SAP S/4HANA boasts a comprehensive accounting module, enabling businesses of all sizes and industries to accurately monitor and document diverse financial transactions.

Human Resources

Both SAP ERP and SAP S/4HANA offer comparable modules in HR. The report’s HR module delves into various sub-modules helping with personnel and employee management, including reward administration, budgeting, disciplinary action oversight and more.

Manufacturing Management

Both SAP ERP and SAP S/4HANA showcase analogous manufacturing management modules. The Comparison Report outlines both systems’ manufacturing capabilities in a feature-specific manner. It will reveal the exact functions that facilitate the configuration and production of a wide array of finished products and components.

Inventory Management

SAP ERP features an exhaustive inventory management module, while SAP S/4HANA trails a little in this section. Both options offer above-average functionality in this domain, featuring well-structured inventory management sub-modules that encompass reservations and allocation support, inventory reporting, and the ability to manage products and goods across multiple locations. 

Procurement Management

Both the ERP solutions will empower users to procure the raw materials for product manufacturing and maintain optimal stock levels. Both SAP ERP and SAP S/4HANA come with comprehensive procurement modules advantageous for any business.

Quality Management 

The quality management modules of both SAP ERP and SAP S/4HANA and highly capable and they enable users to manage procurement tasks, including supplier oversight, compliance management, reporting, payments, and receipt administration. This adds to the smooth functioning of the business.

Sales Management

Both SAP and ERP Implementation come with several sales management features than the typical ERP competitor, though you will find that SAP ERP slightly outperforms SAP S/4HANA in this context. This feature offers the ability of each product to track leads, convert quotations into active invoices, monitor orders, and more.

Product Technology

 Both SAP ERP and SAP S/4HANA provide greater support for product technology than all their average competitors. The product technology metric shows the IT architecture of all the products, including the capacity for third-party system integration, database support, security features, and mobile accessibility. 

Making the decision based on several factors

After going through all these details and comparisons, the next question is, when it comes to SAP implementation, which solution will suit you the best? The answer to that is a little more elaborate than you initially thought. It is vital to remember that SAP ERP and SAP S/4HANA are helping thousands of organizations around the world every day. The most suitable option between them will depend on the unique requirements and challenges of your business. You will also have to consider points such as goals, resources, and priorities of your business, along with functional technical requirements. It is necessary that you consider several factors that will contribute to the ROI of your organization, before making any decisions. The sample metrics you will have to consider in this context are:

  1.  How easy is it to use
  2. Availability of training and customer support
  3. The implementation partners
  4. Vendor familiarity with your industry

Conclusion

Once you have analyzed the whole thing based on these points and also the other factors necessary and unique to your business, the requirements will become clearer. That will lead you to gain a more comprehensive perspective of the subject and possible decisions. Based on these details, you will be able to select the best ERP solution for your business. If you think that all these steps and details are proving to be complicated and confusing, then you can seek assistance from SAP consulting services providers. They will professionally analyze your business process, understand the challenges and goals and based on that, they will make a suggestion. They will be able to tell if you need SAP ERP or SAP S/4HANA. 

27 Sep, 2023

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