The Binderholz Nordic S/4HANA Case Study
Executive Summary
- The Binderholz Nordic Case Study
- BN’s Implementation Partner Tieto’s Observations on the Implementation and S/4HANA
- How Much Did Teito and BN Actually Implement?
- A Three Month Implementation Timeline?
- Obvious Inconsistencies with the Timeline
Introduction
Binderholz Nordic (BN) is a company with around 1350 employees based and $450 million in sales, and operating out of Finland and Austria. Binderholz Nordic is a timber milling company.
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We have to compliment BN and Tieto, BN’s implementation partner, for publishing the most detail of any S/4HANA implementation of any of the public case studies.
BN is another case study with an abridged published implementation timeline.
Tieto, BN’s consulting partner, would have had to have used experienced ECC resources. These ECC resources would have been new to S/4HANA. Some of the functionality from ECC had been removed, and some parts were added to make S/4HANA. Therefore the Tieto consultants were implementing something different than what they implemented before. That lengthens the timeline from my samples.
This is just one example of the complexities, there are many more examples I could bring up, but for brevity, I will stop at this point. However, the complexities involved with S/4HANA combined with the published implementation speed should raise eyebrows. Readers can draw their conclusions, but this calls into questions released to the public in this case study.
Teito’s Statements and Observations on the Implementation and S/4HANA
Teito made some interesting observations after implementing S/4HANA.
“From the functional perspective…it’s more evolution than revolution.”
That has been my research conclusion as well.
“The term simple was misleading.”
I have been writing for some time about how SAP has been inaccurately using the term “simple” as more of a marketing construct than anything real. One of these articles is, Is SAP’s Running Simple Real?
Next, the presentation is explains something which is supposedly a benefit.
“New data models and structures”
Right, this is the cost and benefit of moving to HANA who’s tables have been changed.
“The rate of innovation has been fast -> watch the SAP notes carefully, e.g., change in Finance from 1503 to 1511: business partners and material ledgers were not mandatory in 1503.”
S/4HANA is currently being developed. S/4HANA was announced too early, and SAP development has been scrambling to meet the unrealistic deadlines promoted by SAP’s management ever since.
When companies buy S/4HANA, they are not getting a completed product but a product in flux. Tieto uses the term “innovations,” but the term should be accepted. The more accurate word is that S/4 is “incomplete.”
“Some functionalities available only on a certain service pack level.”
Again, S/4HANA is receiving constant change.
“S/4HANA Enterprise Management is ready to use.”
In this comment, Tieto points to the SAP S/4HANA Simplification List for 1511 FPS3. However, Teito then points to a slide that states the following.
Change of existing functionality: 17%
Functionality not available within SAP S/4HANA: 59%
What is meant by the statement that S/4HANA Enterprise Management is ready to use? Is Tieto saying that S/4HANA is a completed product? It isn’t, so what is meant by the term ready to use?
While S/4HANA is ready to use in parts, it is inaccurate to declare that S/4HANA is ready to use as an overall suite or S/4HANA Enterprise Management.
How Much Did Teito and BN Actually Implement?
Tieto did not implement most of the S/4HANA suite at BN.
- BN is the most credible published S/4HANA case study that I could find.
- Unlike the other public case studies that seem interested in trumpeting the go-live while hiding the details, BN through, Tieto exposed quite a bit of information about the implementation. The only aspect that seems peculiar is the implementation timeline. For people that have not been on an SAP implementation, this timeline may seem reasonable, but of all the software in the enterprise market, SAP will, in most cases, take the longest to implement. This has been widely known since information began to be known about SAP implementations. The only time one sees several month timelines are in press releases.
“After acquisition, only three months time (emphasis added) to implement a new IT-solution for Binderholz Nordic Oy to cover Financial, Controlling, Procurement and Warehousing processes for the two saw mills.” – Tieto
A Three Month Implementation Timeline?
This is a shockingly short timeline because S/4HANA’s precursor, SAP ECC, an application that was far more mature than S/4HANA, never took such a short time to implement. With ECC, over a year’s implementation durations were far more common than implementations of under a year.
Therefore, such a short published implementation timeline for S/4HANA brings up questions regarding either the scope of S/4HANA at BN or the accuracy of the reported project duration. BN would have benefited from having no previous SAP ERP system, as the previous ERP system was Microsoft Dynamics AX. And on the topic of project duration, the BN project has one of the only published project plans that have been made available. But there are quite a few issues that arise from analyzing this timeline.
The project timeline shows 2.5 months from the kick-off to go live rather than three months.
Some interesting highlight of the plan as follows:
- Design Workshop Financial Accounting & Controlling (1 Week)
- Implementation of FI/CO (5 Weeks)
- Design Workshop for Procurement & Warehousing (2 Days)
- Implementation of MM (3 Weeks)
- Integration Testing & Hands-on Training (1 Week)
- User Acceptance (1 Week)
- Go Live Preparations & Data Migration (2 Weeks)
- Post-Go-Live Support (4.5 Weeks) – Tieto
Obvious Inconsistencies with the Timeline
Having been on many SAP projects myself, the plan’s timelines don’t make very much sense.
Let us take one example.
- In step 1 above, all requirements were gathered in 1 week.
- In step 2 above, the implementation took place the following week and lasted for five weeks.
A natural question that any implementer would ask is when documentation was performed?
Documentation cannot be performed in the week the requirements are obtained. Notes can undoubtedly be taken, but it then takes time to create the documentation from those notes. The configuration of the system must follow the documentation or the creation of the functional specification. So, where did that time come from?
One could assume that the documentation is contained in the 5-week implementation of finance and controlling. But this leaves very little time. I have never seen anything like this timeline on any SAP project in 20 years of working in SAP.
But the story is less reasonable than that. That is because the projects I have experienced and witnessed are more mature applications than S/4HANA. And project immaturity leads to longer timelines. It specifically points to the following:
- More discovery being performed.
- A higher percentage of functionality is not working.
- Software maturity being hidden from the account, which leads to further delays.
- More interaction with the development organization by the consulting team, which is a distraction to the project.
- More development resources on-site who take the roles of consultants but don’t have consulting skills.
Implementing immature applications is an extremely trying experience. I have stayed away from SAP applications that I could have consulted in, but which were immature, and I did not want to be on yet another disappointing project for the customer.
Conclusion
Of all the public case studies, BN contains the most information, courtesy of Tieto. However, the timelines presented are unrealistic even for ECC, a far more mature application than S/4HANA.
This brings up how accurate this information was or whether the business requirements were so cut down that this was not a regular project.
This S/4HANA implementation went live on Jan 5, 2016.
This article is part of The S/4HANA Implementation Study. Please see that study for the overall conclusions.