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SAP S/4HANA: The Speed and Power of Simplification

SAP S/4HANA eliminates the complexities of legacy ERP databases, giving organizations a vastly simplified digital core with access to business-critical data in real time. The “S” in SAP S/4HANA is a nod to SAP's legacy business suite. SAP S/4HANA is optimized for SAP HANA, which supports a data model that simplifies the business computing environment dramatically. To take full advantage of this design, SAP S/4HANA was created to reimagine and recode the business suite from the ground up.


Traditionally, the typical enterprise computing environment has been split between online transactional processing (OLTP) and online analytical processing (OLAP). This split is a compromise made long ago: each system gets a copy of the original transactional data, commonly in a different data model, with each optimized for the type of workload (OLTP versus OLAP) in that system. This compromise, though, comes at the cost and complexity of managing two separate environments and moving data between them. Because SAP HANA can support performing analytical calculations and transformations on the fly, organizations can now bring OLTP and OLAP together again. Gone are the complex “helper structures” (indexes and data aggregate tables) that are used to overcome system performance issues running at the speed of disk. Now, with a simplified data model and the speed of in-memory processing, organizations can perform analytics on all data (live and historical) in a single environment – in the moment, as needed.


By redesigning ERP for SAP HANA, the SAP S/4HANA reduces the number of tables dramatically across a wide range of functions. Take, for instance, finance and controlling. While in the past, data was structured in subledgers (accounts payable, accounts receivable, general ledger, asset accounting, cost center accounting, and so on), today they run on a single universal journal. This universal journal brings together postings related to finance (FI) and controlling (CO) in one single source table. The integrity of financial data is guaranteed by design, eliminating reconciliation effort between FI and CO and ensuring that every-one can always access the most current data. Teams are aligned and more effective because the complexity has been removed. Forecasting is faster and more accurate. Key performance indicators such as days sales outstanding (DSO) are avail-able in real time on a granular level. Profit center reporting, profitability analysis, and other real-time analytics performed on top of the universal journal become a reality.

As much as this simplification helps SAP, it also helps our customers. The SAP Tax Compliance application, for example, helps to streamline tax compliance through an automated tax control framework and now runs in SAP S/4HANA instead of a separate system that requires data replication. This application provides an enterprise-wide repository of compliance checks and enables corrections continuously during the current declaration period, freeing tax specialists from searching for anomalies. This simplification to a single source of truth supports new benefits – such as comprehensive enterprise search. Now business users can search for master data and documents across different LoBs and across systems for a holistic view of the enterprise with zero latency in a modern user interface. At the same time, a built-in authorization framework helps to minimize administrative overhead and enable single sign-on so that users can work across LoBs in a secure fashion, without impediments.


A simplified data model is imperative for intelligent technologies, such as machine learning. Traditional database models that maintain acceptable performance only with added complexity simply cannot scale to meet the needs of machine learning deployments. To run simulations, train algorithms, and improve visibility into what’s coming next, technologies need a data model up to the task. SAP S/4HANA is leveraging machine learning technology in the solution itself. One example is accelerated accounts receivable. With legacy databases and complex data models, accounts receivable can be an error-prone process that crosses multiple systems to match purchase orders to invoices. With SAP Cash Application software on SAP S/4HANA, machine learning technology does the matching automatically – and gets better over time with the addition of new data.


With SAP HANA as its foundation, SAP S/4HANA serves as a digital core for the business – one that helps drive business agility, improve customer experiences, and increase business performance.

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