Digital Transformation: The Power of Executive
Collaboration to Streamline Enterprise Change

If your company is like most, the last big change initiative was not that long ago. Whether you deployed a new ERP
system, launched a data initiative, redesigned processes, or optimized your workforce, it’s likely that the memory is still
fresh – as is the desire to avoid that type of disruption again, if possible.

In reality, the only constant in business is change. And it seems that the next wave of change – digital transformation –
is happening faster and more pervasively than ever. Agile enterprises that are ready to adjust continuously are better
positioned to thrive than firms that act too slowly. Flexible organizations also find it less painful and disruptive to
accommodate change.

Digital transformation is now a competitive necessity for most
organizations. The pace of digital disruption is such that CFOs
are looking for ways to accelerate it.
– “The CFO Reimagined: From Driving Value to Building the Digital Enterprise,” Accenture, 2018.

Navigating Change to Maximize Opportunity

Many companies are experiencing change and embracing digital transformation as a strategy for success. This document explores the dynamic
conditions experienced by a composite enterprise called Global Vision and discusses how the enterprise’s executives came together to assess and
evaluate their digital options. It reviews the needs, concerns, and deliberations of these executives and explores the power of working together to
ideate, plan, and execute digital transformation.

We intended this deep exploration of Global Vision’s digital transformation process would provide you with a deeper understanding of how
executives can collaborate to meet the challenge of change. We hope that this insight inspires you to simplify and accelerate your own digital
transformation journey.

Meet the Global Vision Executives

Where to Begin? Guidance for Business Leaders

Taking the first steps toward change can be daunting. However, with strong executive leadership and unremitting focus on a value-driven
transformative strategy, business leaders can not only rise to the challenges of the digital age but actively leverage innovation to increase
stakeholder value.

The need for transformation is the same for all top executives, but how they act on the challenges transformation brings can be quite different. The
corporate drive for growth is often a goal of transformation, and each business leader brings a unique perspective on enterprise change that should
be considered before, during, and after the transformation.

Let’s consider the requirements of the key enterprise executives (see sidebar). When the perspectives of key executives are shared and leaders
collaborate to change the business, the transformation process executes faster, with less disruption, and at a lower cost.

CEO
Senior Vice President, Sales
CIO
CFO
CMO
Senior Vice President, Supply Chain
COO
Vice President, Corporate Development
Chief Risk Officer

Impetus for Change: Launching Transformation

Industry change and new market competitors were ratcheting up the pressure on Global Vision. An international firm with tens of thousands of
customers, an extensive supplier network, and a 50-year history of success, Global Vision was accustomed to leading its market.

But the ground was shifting, and everyone knew it. The recent Investor Relations Day saw the culmination of a challenging year. Financial results
were below market expectations, and analysts wanted to know why. The share price was heading south. And shareholders were demanding action.

The company’s board and top leaders already recognized what would soon become obvious to the rest of the stakeholders: Global Vision needed to
transform itself. The only other options were to significantly restructure, divest the business, or be acquired.

Company CEO Maria Schneider called her team together.
185 268 370 385 396 405 411 416 427 432 448 451 455 460
436%

Increase in share of CEOs who
expect global economic growth
to “decline”1
2 3 4 5 6 7 8 9 10 11 12 13 14 15
16%

Decrease in share of CEOs who
are “very confident” in their
12-month revenue prospects2
1., 2. “CEO’s Curbed Confidence Spells Caution: 22nd Annual Global CEO Survey,” PwC, 2019.

Laying Out the Problems

Nine of the top executives from Global Vision were in the hotel conference room, waiting for the CEO to arrive. The executives spoke among themselves, wondering why they were called here for the second time in the same calendar year when off-site executive events were typically held only once a year. Most of the attendees agreed that an off-site meeting again so soon was not a good sign.

Subdued discussions turned to silence when CEO Schneider entered the room and settled into her seat at the head of the table. “Well, here we are again,” she opened. “Same problems, same results.”

“We’re still in the same place that we were last time we met,” she said. “Our strategic transformation must move faster. We’re too scared, and the plans we implemented in our meeting just a few months ago seem stale already. You all know about the results of our Investor Relations Day. It’s time to rethink our entire strategy, because the things we’re doing to compete simply aren’t working.”

Executives were able to see only partial views of company performance in their own areas of the business. They knew they bore some responsibility for the big picture under question by the CEO. But that holistic view was elusive. Difficult to see and even harder to manage, performance was segregated into silos. Data visibility, transparency, and fundamental accountability and ownership seemed vague and ambiguous at best – despite all efforts and initiatives to remove artificial walls that had begun after the previous off-site meeting.

The executives each suspected that something was very wrong, but none could define or articulate it accurately. Some secretly blamed others around the table for the problems they collectively faced. They all anticipated a difficult meeting.

Envisioning a Stronger Future

The CEO, an expert at reading a room, knew it was time to change the tone. “We’re going to conduct this meeting differently,” she said. “Today will
be a microcosm of how we intend to run the company from this point on: as a forward-looking operation. We’re not going to scour and review
performance metrics, scorecards, or financial reports. Instead of everyone describing pain points and barriers, I want you to tell me what you think
will move this company forward.”

Schneider continued. “Let’s begin with an assumption that all ideas are good, nothing is impossible, and everything is on the table,” she said. “Let’s
be creative, innovative, and transformational. Focus on the possibilities and visions for the future rather than rehashing the past.”

A palpable sense of relief came over the team as they realized things were changing. This meeting would be different. Gone was the dread, replaced
by hope that a different kind of plan would emerge over the next few days – a plan that could improve the lives of their customers, suppliers,
business partners, and employees. They wanted to strengthen the company that they each believed in wholeheartedly. It was clearly time to reinvent
Global Vision.

5 10 15 16 17 19 21 23 25 26 27 29 33 35
36%
 Of companies prioritize a few cross
-functional capabilities at the company
level and expect functional leaders to
identify how they contribute to the
mission3
10 14 19 24 27 31 33 36 38 42 45 49 51 53
55%
 Of companies work in silos, with each
function making its own decisions on
which capabilities matter most4
10 14 19 24 27 32 36 42 45 48 52 55 58 60
61%
 Of companies say the solution to
reaching their strategic goals is
collaborating more across functions,
paired with faster decision-making5
3.–5. Frank Ribeiro, Augusto Giacoman, and Maureen Trantham, “Dealing with Market Disruption: Seven Strategies for Breaking Down Silos,” PwC, 2016.

The Promise of Digital Transformation

In a global economy in which frequent change, real-time customer experiences, and industry disruption are more the rule than an exception, many
companies are looking for ways to not only survive but also prosper. Decision-making requires action over reaction, prediction over reflection, new
styles of teamwork, and unrelenting urgency. When traditional management styles fail to transform the company in response to these pressures,
company boards and officers find themselves seeking change.

In addition to helping companies meet these new market demands, digital transformation can be accomplished more quickly than any change
initiative of the past. With that in mind, starting now is key. Change is coming to your industry too, and it’s likely that your competitors have already
begun to transform themselves. Will you be ready?

Decision-making requires action over reaction,
prediction over reflection, new styles of
teamwork, and unrelenting urgency.

Reviewing Operational and Sales Challenges

The CEO went around the room, asking for concise executive feedback.

The COO, Mark Di Paulo, was the first to speak. His opinions were not only the most prolific of the group but often the most accurate. “We need to be able to quickly identify, understand, and correct our direction – with more impactful and complete information – in those areas where we’ve lost control of processes and procedures, such as manufacturing and production,” he said. “There are areas that fall under cost containment, parts availability, and so on, which are under my purview. Working in conjunction with Dale and the supply chain team, we can address those areas for major impact and identify our starting point to ove forward with this process.”

“If we can optimize our processes and procedures across business units, we can achieve control, balance, and integrity in my areas,” Di Paulo said. “The true magic will happen if the business units can work together to change culture and embrace a more holistic approach to the root cause analysis and corrective actions related to all of our jobs. That means manufacturing, production, and supply chain management. But this requires streamlining both supply channels and international trade protocols and processes.”

The senior vice president of sales, Chaz Wilson, was next. He frowned at the mere suggestion of lowering prices. “We offer premium products,” he countered, “and we must continue to lead the market in which cheaper prices are common. Our true opportunity is to expand the market, not just into new regions but also to a different customer base. We need to expand the brand through marketing, promotions, and strategic bundling – not through discounting.”

Presenting Approaches from Information technology and Finance

The round-robin discussion continued, with each executive sharing a perspective unique to his or her own
part of the business. The CIO and CFO waited to present their ideas last.

The CIO, Nikki Andreessen, had heard many of these ideas before, although not in a setting like this. As she and her team met with business users, ideas like this were common but often disconnected from company goals. She had been investigating a new architectural approach for two years – one that would simplify the IT landscape, offer new capabilities to the business, and alleviate many of the problems related to disconnected data.

She spoke up as soon as the previous speaker finished, almost interrupting. “I think we need to go to one common corporate system,” Andreessen said. There was an audible gasp in the room and more than a few raised eyebrows. “It is more doable now than ever before, and the capabilities are there to dramatically simplify our processes, data, and systems. We just need everyone’s buy-in, which has been hard to get. But now is the time.”

Michael Smith, the CFO, was listening intently, waiting to speak until everyone else was finished. He was prepared for this. His years of experience, research, networking, and understanding of team dynamics had led him to one conclusion.

“We obviously need to transform – and quickly,” Smith said. “It may sound self-serving, but I think a finance-led digital transformation is the answer. It will address all of the goals and ideas discussed here today. Sounds scary, but I think we can get results in as little as six months.” Everyone looked at Schneider, the CEO. The smile on her face said it all. “Let’s get started then,” she says, “We need to spend some time coming up with new ideas and begin to organize and prioritize our objectives.

When we come back together next time, be prepared to discuss your top three priorities for each major business area. I’d like you to categorize them as quick wins, foundational targets, or high-impact goals.”

Then Schneider looked at the CFO. “Michael, because you have been through this type of transformation before, I would like you to work with the CIO and create a plan of action,” she said. “Include the capabilities we will need from a process, data, and technology standpoint, within a framework of expected value.”

As the executives adjourned, they began discussing the topics. Over the next few weeks, they met to crystalize their goals – choosing important, feasible, and value-driven changes for their organization.

Building the Case for Change

Michael Smith, Global Vision’s CFO, had previous experience leading transformation. He knew that the best approach was to allow consensus to
form naturally across the business stakeholder groups. Smith supported collaboration and emphasized that seemingly independent goals were both
related and mutually beneficial. He also understood the need to formulate a value case that all stakeholders could defend equally.
10 13 17 22 26 36 39 48 52 59 67 73 84 88
90%

Of senior finance executives believe that finance should facilitate
collaborative enterprise planning to ensure that operational plans
are aligned with financial and strategic plans6
6. Steering through collaboration: CFOs driving new priorities for the future. The Economist Intelligence Unit, 2018

Breakout Conversations Among the Executives

The executives began their discussions separately, meeting with their colleagues to discuss their requirements, business challenges, and solution
needs. To maximize their effectiveness and ensure they comprehensively reviewed the entire corporate ecosystem, they paired off in partnerships
designed to optimize their strategy.

CFO and CIO
CFO and CRO
COO and Senior Vice President of Supply Chain
CEO and VP of Corporate Development
SVP Sales and CMO

Unified Perspectives

In the team’s next meeting, Michael Smith, the CFO, proposed a half-day for a design thinking session. Although the executives would typically send delegates to meetings such as this, the invitation reminded them of the CEO’s requests and the urgency of the task. The leaders regrouped in the conference room and began to recap their conversations. They were pleasantly surprised to hear similar value themes emerging from their separate threads.

Michael walked to the front of the room and began to bring the perspectives together. He started drawing a model on the whiteboard, one that captured the different perspectives of the executive stakeholders. More importantly, he wanted to convey the truest representation of the different aspects of the business model – and their equal reliance on one another.

The four quadrants included operations, customers, people, and technology (see Figure 1). A center box indicated that all four areas are driven by the company’s strategy. Smith intended this model to be the start of a design thinking approach to mapping out a new paradigm – a technique he had used in previous transformation efforts.

10 16 23 26 29 31 32 36 38 40 42 54 65 69
71%

Of respondents say that design thinking improved their
working culture7
 
Figure 1: Four Areas Driven by Company Strategy
7. Schmiedgen, J. et al.,“Parts Without a Whole? The Current State of Design Thinking Practice in Organizations,” (Study Report No. 97) (p. 144).
Potsdam: Hasso-Plattner-Institut für Softwaresystemtechnik an der Universität Potsdam, September 2015.

Goals and Capabilities

The CFO encouraged the participants to write down their ideas on sticky notes and place them on the whiteboard in the appropriate quadrant. The participants used orange sticky notes for quick wins, blue for foundational, and green for high impact. The color coordination helped convey priority, feasibility, and overall value to the business. The executives began discussing their ideas.

As the leaders talked, the CIO and CFO worked on an adjoining whiteboard. They summarized the key capabilities needed to meet each goal and put them into a rough timeline. After about an hour of debating and moving the notes around on the board, the team was satisfied with their high-level plan.

The next step in the challenge, said Michael, was for the executives to do a deeper dive with their teams. They needed to define the relevant scope, a timeline-driven plan of action, and a business case. Faced with this effort, the executives began to stare at the right side of the board, wondering out loud whether their current business systems would be able to support the key capabilities.

  
Key capabilities:
  • Unified digital platform (billing, supply chain
    management, financials, customer relationship
    management, and human resources)
  • Intelligent automation and analytics
  • Single version of the truth
  • Data as a key differentiator
  • Management of experiences versus transactions
Figure 2: Goals and Supporting Capabilities

One Chance to Change

The goals are articulated, the challenges identified, and priorities well understood. And the timing is urgent.

Yet many companies still make only small fixes to their existing and outdated process, data, and technology platforms. To succeed, changes must be
bigger – and yet they still must be executed at record speed.

The most successful transformations, those that lead to measurable business value, are driven by introducing a modern, agile, and proven digital
platform that moves organizations forward faster than ever.

5 10 15 23 28 35 41 43 45 47 50 53 56 60 63 65
67%
 Of CEOs in 2019 say that acting with
agility is the new currency of business
and being too slow risks bankruptcy,
up from 59% in 20188
10 12 15 23 28 35 41 43 45 47 50 53 56 60 65 73
76%
 Higher operating margin where
financial systems provide historical
and forward-looking views into
financial and operational performance9
10 11 12 13 14 16 18 19 20 23 24 26 27 30 32 35
36%
 Lower budgeting and forecasting
costs for organizations where the
finance organization is able to update
forecasts and conduct simulations10
8. “Agile or Irrelevant: Redefining Resilience: 2019 Global CEO Outlook,” KPMG International, 2019.
9., 10. SAP Performance Benchmarking.

A Path Forward

Nikki Andreessen, the CIO, saw this doubt as an opportunity to address the issue everyone was thinking about: How could Global Vision make all of this happen from an IT standpoint? “The way I see it,” she said, “these key capabilities require a platform focused on four main value levers: agility, automation, analytics, and assurance.”

“We cannot achieve our goals by making small adjustments and upgrades to our existing systems, like we have done in the past,” she said. “This transformation will require us to establish a digital core: a foundation that reflects our business in real time, introduces modern industry capabilities, adopts an analytics platform, pleases our users, and offers an agile approach to future changes in our business.”

The executives realized that the CIO had given this change a great deal of thought. “We’ve done our research, consulted our partners, and asked industry peers and market analysts,” she said. “The consensus is that the best platform for our needs is SAP S/4HANA. Luckily, we already have SAP solutions in place in some areas of our business. Moving to the next-generation SAP S/4HANA could be a pivotal decision that accelerates our transformation.”

Michael, the CFO, agreed. “This is consistent with my experience and research as well,” he said. “At my last company, the move to the SAP S/4HANA Finance solution – especially the universal journal and intelligent automation capabilities – was the tipping point for the rest of the organization to embrace the transformation and quickly achieve value. SAP S/4HANA is unlike any previous release of SAP ERP. It exceeded all of my expectations on the four As that Nikki mentioned before.”

He continued: “My office, along with the CIO, will be formulating the final case for change for the next meeting with the CEO. Please expect my team to reach out and get your teams on the calendar. We will be engaging with all of you, our partners, to facilitate some deeper-dive sessions. We’ll even invite SAP in for some art-of-the-possible workshops and demos to finalize the perspective. You will all have a chance to contribute and review, so there will be no surprises.”

SAP S/4HANA: The Power to Transform Core Finance Processes

Assisted user interface
Proactive business-
contextual assistance		 Business situation
support and alerts		 Speech-controlled
assistance
Intelligent finance applications
Redesigned, simplified,
and automated processes		 Embedded anytime
analytics with prediction		 Cross-company
integration
Intelligent technologies
AI and machine learning Predictive analytics

Single
financial
truth
Universal journal
Single journal entry –
no redundancy		 Actual, plan, and
simulation data		 Reconciled and
consistent by design
Integrated data platform
Transactional and
analytical data		 Real-time speed Unlimited drill down
Agility
Supports corporate strategy
   
Analytics
Provides better insights
   
Assurance
Manages risk and compliance
   
Automation
Manages cost of finance
Figure 3: Intelligent Finance with SAP S/4HANA®

Why SAP S/4HANA® Finance?

Powerful finance suite from a
market leader

Extensive coverage for language and
country-specific regulatory requirements

Comprehensive, enterprise-wide
cloud portfolio

Global service coverage from SAP,
global partners, and expert ecosystem

Award-winning user experience
and cloud innovation platform

Broad industry coverage and best practices
11.–13. SAP Performance Benchmarking.
10 12 13 14 15 17 18 19 20 21 22 23 24 25
26%

Fewer days to close annual books in an integrated
general ledger system so that no reconciliations are
necessary11

1 2 3 4 5 6 7 8 9
10%

Higher forecast accuracy with online, ad hoc
analysis and reporting along key dimensions, such
as customers, regions, and divisions, as well as the
ability to drill down to the desired level of detail12

10 12 15 20 25 28 32 38 40 42 43
44%

Lower audit cost as a percentage of revenue in
companies that streamline and automate
compliance processes13

Recommending A Course of Action

After conducting workshops, meetings, and deep dives, the executives gathered again to prepare for
the next big meeting. The last few weeks had been active, with workshops designed to match the
expectations of the business areas with the capabilities needed from the new platform. The focus was
on business value, not just fancy new features, and the end users were integrally involved in building a road
map of priorities. This meeting was to present the final business case to the entire executive team and
secure a vote of confidence from the CEO.

Maria, the CEO, came into the room. “Thanks for joining this important follow-up meeting,” she said. “It’s
our opportunity to come together as an organization, leveraging all our talents and newfound insights
to rebuild and recreate a sustainable and more profitable company. I appreciate all of your efforts over the
past six weeks. From what I hear in the halls and at the ‘water cooler,’ our teams have done a great job of
expanding on the high-level directions from our first executive meeting, researching alternatives, and
exploring other value opportunities. Some of you have leveraged research, consulted with partners, and
spoken with our industry peers about the possible courses of action.”

The CEO acknowledged that each of the participants had different perspectives and opinions
based on their own experiences. “I trust that we will all maintain an open mind and work as a
team to find the right balance of change,” she said. “We must focus on the truly differentiating
parts of our business that require specific capabilities versus those areas where we can quickly
agree to accept industry standards and best practices.”

Maria reminded the participants that they were to discuss the combined findings and outcomes
of this planning effort and to consider how these recommendations would impact each area of
responsibility. “Since you have all been part of the workshops, we won’t discuss the specific
workshop approach. Instead, I would like to focus on the recommendations from the teams,”
she said. “I’ve asked Michael to lead this discussion, as well as drive any implementation plans
that will arise from this effort. As CFO, he is in the unique position of already supporting all areas
of the business in his current role.”

She continued: “To reiterate, my priorities are clear. Along with cost containment and revenue
growth, I want to focus on how this initiative will transform our IT platforms, provide an optimal
operating model, automate manual processes for our workforce, and, ultimately, improve our
customer relationships. Be aware, that is the lens I’m using to offer my approval for this initiative.”

Then she restated her expectations. “After this meeting, we should have specific action plans
for our respective functional areas, where we are paired up, to further facilitate drilling into
substantive issues, root causes, and value areas for us to attack,” she said. She looked to the
CFO, “Michael, I want you to drive this effort.”

A Review of Foundational Issues

The CFO launched the presentation from his laptop, projecting it onto the screen. “Thank you, Maria,” he said. “I’m proud of our teams and how they have worked together to build what I believe is an exciting path forward for our company, with potentially very significant business value on that horizon.”

Michael began by discussing three basic data-related issues that were raised in each area of the business:

Quality and availability

Transparency and timeliness

Relevance and reliability

It was clear that each of these areas was consistently inhibiting growth, requiring sometimes heroic manual efforts by a standing army of human capital resources to create usable insight. At the core, they resulted from Global Vision’s outdated, complex, and heterogeneous processes and systems. “A lack of a common view of the enterprise is causing significant churn around non-value-added activities, while we’ve taken inconsistent and disjointed approaches to address even basic issues,” he said. “As a team, we are thrilled to recommend a new path.”

He began to review the teams’ work and the resulting recommendations, which were broken down into four main areas:

Opportunities

Solution considerations

Value cases

Implementation options

The CFO encouraged each of the leaders to discuss the opportunities within their respective areas of the business. “Underlying this discussion, of course, are finance, risk, and IT, which will provide the backbone of the strategy and play critical roles in each of the individual proposed efforts,” he added.

Opportunities
After gathering feedback and ideas from the various stakeholder groups, the teams had placed the information into the same four-quadrant model the CFO had used in the design thinking session (see Figure 4). They segmented goals based on the short term and long term and on value expectations. The teams also had conducted art-of-the-possible workshops and watched SAP product demos, which helped them identify additional use cases, such as experience management, artificial intelligence, and billing and revenue management.

Global foundation
Grow (long term)
Integrated operational reporting system by processes and operations cells
Support tools and processes for sales and operations finance
Centralized procurement system(s)
Global trade practices controls
Direct-to-consumer business model
Sales force and compensation model realignment
Focus on customer experience management
Continuous feedback and insight – employees, customers, and suppliers
Data-driven culture
Concentration on high-impact work
Simplification and harmonization
Landscape total cost of ownership and the cloud
Customer-facing innovation
Stabilize (short term)
Reduce cost of poor quality
  • Scrap and rework
  • Attrition and yields
Streamline supplier base
Create single view of customer
Improve customer, product, and brand P&L
Enhance cash forecasting
Optimize capital planning process
Create new user experience
Reduce manual efforts
Focus on value-adding activities
Remove data silos
Develop one truth for all financials
Perform corporate closing in two days
Automate item clearing and matching
Strategy
CEO, CFO, corporate
development
Cybersecurity | Data and information strategy | Risk management | User experience | Self-service | Harmonized processes | Privacy
Figure 4: Opportunities Quadrant

Solution Considerations
Next, the teams focused on how value cases could be satisfied by a combination of people, process, and technology initiatives. They also considered how achieving the necessary capabilities could be accelerated by choosing the right solution platform (see Figure 5).

The teams conducted significant research and planning on SAP solutions, which was especially useful given Global Vision’s investment in SAP offerings, its partnership in this process with SAP, and SAP’s leadership position in the market. The teams also gathered proof points to show how these solutions have been implemented successfully on a large and complex scale among the company's peers.

Value Cases
The teams explored the various aspects of value achievement, time to value, and the overall ROI of the transformation program (see Figure 6). Among the main topics discussed were total value expected by the end of the program, any accelerations that could speed up the value curve, and expected costs.

Discussions coupled quantitative value metrics with the qualitative considerations to create an expected value equation worthy of justification and approval by the board. This included a viewpoint on how
SAP S/4HANA® could accelerate value achievement.

 
Key capabilities:
  • Unified digital platform (billing, supply chain management, financials, customer relationship management, and human resources)
  • Intelligent automation and analytics
  • Single version of the truth
  • Data as a key differentiator
  • Management of experiences versus transactions
Figure 5: Capabilities Requirements

Themes identified:
  • Sourcing and vendor
    collaboration
  • Distribution, logistics,
    customer order management
  • Master data and business
    intelligence (BI)
  • Demand and supply planning
  • Product lifecycle management
Figure 6: Transformation Program Value

Implementation Options
The teams also developed a high-level view of a road map to success, along with execution options requiring deliberation. This included an overview
of three different deployment scenarios for moving to SAP S/4HANA and the value achievement variations posed by each scenario (see Figure 7 and
Figure 8).

Business objectives
Transition path
Destination options
Enterprise transformation
Business process optimization
ERP rapid modernization
New implementation
System conversion
 SAP S/4HANA® Cloud
 
 SAP S/4HANA including
SAP HANA® Enterprise Cloud
and infrastructure as a service
Figure 7: Deployment Scenarios

In addition, the teams had outlined a high-level timeline and key considerations to mobilize and execute each of the scenarios. The road map shows how finance could be the initial starting point for the transformation and how that would impact the other areas of the business.

Enterprise
transformation
Extended
enterprise core
New enterprise
core
Capture
assurance
Capture
analytics
Capture
automation
Capture
agility
Assurance
  • Developing foundational capabilities to manage risk, ensure compliance, and create a
    platform for growth
  • Enforcing harmonization with standardized processes
Analytics
  • Providing new insights to the business with accurate perspectives on past, present, and
    future performance
  • Moving to a data-driven organization
Automation
  • Managing the costs of finance through intelligent automation (AI, machine learning, and
    robotic process automation)
  • Removing manual effort and shifting focus on information workers to value-add activities
Agility
  • Supporting corporate strategy, moving to new business models, and disrupting the industry
  • Preparing not only for short-term flexibility but also long-term agility
Figure 8: Value Capture Along the Transformation Journey

Alternatives for Change

After reviewing the four main sets of recommendations, the CFO turned to the next step in the meeting. “As you can tell,
there are significant opportunities identified across all areas,” he said. “However, addressing these opportunities with our
current systems will not only be difficult and very costly – it will also leave us with a platform that cannot support new
revenue models. It will not provide the agility we need to capitalize on new business opportunities. And it will not allow
us to take advantage of efficiencies gained through automation.”

Over the years, he reminded the executives, Global Vision had tried to optimize its legacy systems with system updates
and customizations. “This patchwork will not be viable for any future business evolution, especially of the nature we
currently have in front of our teams,” Michael said.

The CFO asked the CIO to discuss potential paths the company could take from an IT perspective and discuss the
paths other companies have taken. Nikki, the CIO, agreed to lay out the three options based on the company’s
current state of affairs.

CIO’s Perspective

The CIO had examined all of the transformation options and was prepared to share her findings with the executives.

She explained that the current solution had been in place since the company deployed it 10 years ago. “A significant amount of customization has
occurred in the past, making our systems costly to maintain,” she said. “And our reporting has become a tangled mess that requires major manual
effort.” This heavy customization causes training issues and increases risk when there are personnel changes.

The quality of the data was another huge issue. “Having no global master data governance means we have far less insight into key vendor and
customer relationships,” she added. “Bank accounts, for instance, have proliferated over the years with each acquisition. I could go on, but we are all
aware of the impacts of these issues.”

Scenario 1
ERP rapid modernization
READ MORE
Scenario 2
Business process optimization
READ MORE
Scenario 3
Enterprise transformation
READ MORE
Figure 9: Value Measure for Three Scenarios

Closing Remarks

The CFO thanked the CIO for her presentation.

The CEO looked at her watch and realized time was flying. She knew that a big decision was still to be made to get ready for an upcoming board meeting.

“We’ve heard a lot today from Michael and Nikki on a path forward,” she said. “If we proceed down a recommended path, it will take a commitment and buy-in from all of you to make this program successful. It will also take a commitment from our board for the investment needed. I’m happy to take our proposal to the board, but only if I have a commitment from all of you.”

She continued. “To do this, we need to make a decision on which of the three paths to take,” she said. “Let’s walk through each of them in more detail.”

Three Scenarios for Deploying SAP S/4HANA

Businesses that move to an intelligent platform gain critical momentum over their competitors. SAP S/4HANA is the latest generation of
SAP Business Suite software. Characterized by streamlined transactions, a better user experience, simplified data flows, and new functionality,
SAP S/4HANA helps enable strategic insight that can unlock new opportunities, evolve business processes, or solve previously intractable challenges.

Companies can choose to move to SAP S/4HANA in one of three main scenarios (see Figure 10) – each with a unique value proposition, scope,
and time-to-value considerations:
  • ERP rapid modernization
  • Business process optimization
  • Enterprise transformation
Figure 10: Three Scenarios for Deploying SAP S/4HANA®

The following chapter breaks down these scenarios and discusses the factors used by Global Vision to choose its path.

Choosing the Best Path

After the second meeting with the CEO, the executive team met to discuss its next steps. The following sections discuss three potential
transformation paths that could be followed by Global Vision. Choose the scenario that best matches your business challenges, and see how the
company moved forward with its transformation – and what you can learn from their experience.

ERP rapid
modernization

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Business process
optimization

READ MORE

Enterprise
transformation

READ MORE
Peer digital transformation
Peer
Robotic process
automation (RPA)
Cognitive
Technology
optimization
1.009%
1.009%
0.880%
0.589%
-0.072%
-0.057%
-0.291%
World class
RPA
Cognitive
Digital world class
0.596%
0.538%
0.486%
0.399%
-0.059%
-0.052%
-0.087%
-41%
World-class
advantage
-60%
RPA, cognitive,
tech optimization
opportunity
Figure 10: Finance Cost as a Percentage of Revenue (2009–2019)

Source: The Hackett Group, “World Class Finance: Redefining Performance in a Digital Era,” May 15, 2019

Regardless of the scenario selected to move to SAP S/4HANA, we will be able to execute our aggressive enterprise growth strategy while containing costs and improving margins for all areas of the business.

Some of the key benefit drivers include:
  • One source of the truth for all numbers
  • Real-time data access for instant, predictive analytics and a modern user interface to enable actionable insight
  • Improved customer profitability
  • Increased supply chain efficiency and effectiveness
  • Reduced risks in such areas as operations, finance, and compliance
  • Improved planning tools capable of meeting all our planning and forecasting needs
  • Maximized working capital flows for reduced financing costs and a dramatically simplified global banking footprint tolower fees
  • A platform for growth, innovation, and automation, making our organization more agile
  • Reduced customizations through adoption of standard functions
  • Faster development of even newer capabilities to improve effectiveness
  • A dramatically compressed and reduced data footprint, including the elimination of multiple data stores and silos

Epilogue: Results from Global Vision’s Transformation

One year after the transformation began, the Global Vision executives began looking back at what they had accomplished. The following sections discuss the results from each transformation path. Choose the scenario that best matches your business challenges and see how the company transformed itself – and what you can learn from Global Vision’s experience.

ERP rapid
modernization

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Business process
optimization

READ MORE

Enterprise
transformation

READ MORE

Looking Ahead: Next Steps for Your Digital Transformation

Companies must stay one step ahead of the competition by innovating, enabling exceptional customer experiences, and delivering top-line and bottom-line results that please investors and board members alike.

SAP S/4HANA empowers companies to thrive in the experience economy. Using advanced automation technologies and enabling digital trust, the solution helps enterprises realize excellence in finance and risk processes. SAP S/4HANA helps ensure the financial viability of business models and enterprise transformation and accelerates the time to value in ERP migrations by maximizing the use of technology innovations.

With SAP S/4HANA, you gain forward-looking profitability insights for your customers, supply chain, products, and services. The solution automates resource-intensive tasks, and embeds risk and control monitoring to help you comply with an ever-changing regulatory environment. By combining transactions and analytics across the business, SAP S/4HANA enables fact-based and predictive decisions.

We offer several attractive approaches to accelerate your move to SAP S/4HANA. Whether you choose a rapid migration, business process optimization using SAP S/4HANA for central finance foundation, or a complete enterprise transformation, SAP is ready to help you on your journey to become an intelligent enterprise.

Learn More
Read more about SAP S/4HANA:
The Value of Central Finance
SAP S/4HANA for Your Industry
The Value of SAP S/4HANA
Virtual Finance at SAPPHIRE NOW®
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Agility
Supports corporate strategy
Automation
Reduces the cost of operations
Analytics
Provides predictive insights
Assurance
Manages risk and compliance