Comparison of SAP ECC and SAP S4 HANA

Differences between SAP ECC vs S/4HANA Database: ECC supports databases from other providers such as Db2, Oracle, or Informix, however, S/4HANA only runs on SAP HANA . As a result, S/4HANA has much faster reaction times thanks to its in-memory database.

What is SAP ECC?

SAP ECC, short for SAP ERP Central Component, is a flexible and customizable software solution that can be tailored to meet the specific requirements of various business functions such as finance, HR, and logistics. It also seamlessly integrates with external applications including custom or third-party messaging apps.

SAP ECC is known for its extensive interconnections among components, which adds to its versatility but also increases complexity. Modifying one aspect can have repercussions on other functions, necessitating careful consideration when implementing upgrades or add-ons to avoid disrupting critical business operations. This principle equally applies when transitioning your systems to SAP S/4HANA.

What is SAP S/4HANA?

SAP S/4HANA is the latest ERP software developed by SAP, which can be used both on-premise and in the cloud. It incorporates advanced technologies such as artificial intelligence, machine learning, and automation to enhance business productivity and accelerate processes. This innovative solution enables real-time analysis of vast amounts of data while offering various beneficial functionalities for users.

1. Customized information

2. Streamlined operations

3. Built-in data protection

One major drawback is that SAP S/4HANA can only be used with the SAP HANA database. This can be problematic if your current SAP ECC system operates on a third-party database such as Oracle. When transitioning to SAP S/4HANA, it will be necessary to eliminate any unsupported add-ons during the migration process.

Before learning how SAP S/4HANA is different from SAP ECC, check out our video that introduces SAP S/4HANA.

What are the Distinctions Between SAP S/4HANA and SAP ECC?

SAP S/4HANA simplifies functions and procedures from SAP ECC to lower expenses and enhance operational effectiveness for businesses. Consequently, certain features have been modified, while others have been substituted or merged into novel functionalities.

Below are some of the major differences in SAP S/4HANA compared to SAP ECC.

Default Account-Based CO-PA

SAP ECC uses costing-based CO-PA as its default option, while SAP S/4HANA uses account-based CO-PA by default. However, it is possible to run both options simultaneously in SAP S/4HANA.

Difference Between SAP ECC and SAP S/4HANA

In SAP ECC, businesses handle their financial information using separate tables for FI (Finance) and CO (Controlling). However, in SAP S/4HANA, both FI and CO are integrated into a single table called ACDOCA, known as the Universal Journal. This integration eliminates the need to manually reconcile these modules with the General Ledger during each period-end. With ACDOCA, reconciliation happens automatically in real-time, making period-end closings much simpler in SAP S/4HANA.

Material Number Extension

SAP S/4HANA gives you the option of extending the material number from 18 characters to 40 characters. Bear in mind, though, if you turn on the extension you will have to adjust your custom code to the new material length of CHAR40.

Integrated Business Partners

A single business partner can have various roles and addresses. The general information is shared among these roles, resulting in a smaller database size. Redundancy is minimized as any unused data is removed after a specific period of time.

Real-time MRP

In SAP ECC, it is necessary to wait for non-peak hours and execute a batch job in order to carry out material requirements planning (MRP). However, with SAP S/4HANA, MRP can be performed in real-time. Additionally, subcontracting has been made more streamlined in SAP S/4HANA. Nevertheless, unlike in SAP ECC where MRP can be run at the storage level, it is now limited to plant and area levels only.

SAP APO Integration: Understanding the Difference

SAP S/4HANA combines the key submodules of SAP Advanced Planning Optimizer (APO) into two new configurations.

1. The new SAP Integrated Business Planning (SAP IBP) module combines demand planning and supply network planning.

2. Within the SAP S/4HANA digital core, production planning, detail scheduling, and global ATP have been partially merged together.

The modifications imply that the transition from SAP APO to the updated setups cannot be done automatically.

Mandatory Material Ledger

The Material Ledger (ML) is an optional feature in SAP ECC but becomes mandatory in SAP S/4HANA. Many companies choose not to activate the ML in SAP ECC because of difficulties with numerous aggregate and index tables. However, in SAP S/4HANA, the ML is integrated into ACDOCA, eliminating these previous challenges.

What are the benefits of S4 Hana over ECC?

1. Real-time data analysis: SAP S/4HANA enables the analysis of large volumes of data in real-time, allowing for immediate insights and decision-making.

2. Enhanced efficiency: Working with extensive datasets from a single interface streamlines processes and helps save time by eliminating the need to switch between multiple systems.

3. Cost reduction: By leveraging S/4HANA, organizations can reduce operational and hardware costs associated with managing and processing large amounts of data.

SAP S/4HANA: Latest Enhancements

SAP S/4HANA offers a wide range of advanced functionalities that enhance data management capabilities. Notable features encompass the following..

ACDOCA: The Universal Journal in SAP

As previously stated, SAP S/4HANA integrates various data modules into a unified table known as ACDOCA (the Universal Journal). This encompasses asset accounting (AA), GL, ML, management accounting (MA), FI, and CO-PA. By eliminating numerous aggregate and index tables, ACDOCA significantly reduces the amount of data stored. Consequently, it operates as a more streamlined and efficient system.

MATDOC Inventory Management

SAP S/4HANA brings in MATDOC, a modern inventory management system that replaces multiple tables found in SAP ECC. With MATDOC, material documents are now stored more efficiently, reducing redundancy and enhancing the effectiveness of stock reporting.

SAP HANA Database: Understanding the Difference

As mentioned earlier, SAP S/4HANA requires the use of the SAP HANA database, which contributes to its enhanced speed and efficiency compared to SAP ECC. This is primarily due to a few key factors. Firstly, SAP S/4HANA retrieves data directly from the main memory instead of relying on the hard disk, resulting in reduced data movements. Additionally, its tables are organized in a column-based structure rather than row-based, enabling it to retrieve only relevant columns during queries and process multiple columns simultaneously. With no need for aggregate, index or history tables since applications can access original data directly, SAP S/4HANA integrates online transactional processing (OLTP) and online analytical processing (OLAP) tables seamlessly without requiring reconciliation efforts.

Advanced ATP

In SAP ECC, you have the ability to verify product availability, allocation, and backorders using available-to-promise (ATP). However, with SAP S/4HANA, you can perform these tasks and much more through advanced ATP (aATP). aATP incorporates automation for various functions.

Releasing products for shipment, verifying stock availability in other facilities, conducting bulk availability checks.

Global Trade Services

SAP S/4HANA incorporates global trade services (GTS) that take over the foreign trade functionalities found in SAP ECC. With the implementation of SAP GTS, previously manual processes in SAP ECC are now automated, resulting in faster operations. These automated tasks include embargo verification, license checks, and import/export declarations.

FSCM Credit Management: Understanding the Difference

In SAP ECC, the credit management system was known as FI-AR-CR. However, in SAP S/4HANA, credit management is now part of financial supply chain management (FSCM). FSCM-CR in SAP S/4HANA offers automated workflows that eliminate the need for manual tasks such as approving credit limits and assessing risks. Additionally, its distributed architecture allows it to directly connect with external credit agencies.

Extended Warehouse Management

In SAP ECC, the management of warehouses occurs within the Warehouse Management (WM) module. However, in SAP S/4HANA, this is substituted by the extended warehouse management (EWM) module. With SAP EWM, you can efficiently handle intricate warehouse procedures like labor management and goods distribution.

Revenue Accounting and Reporting (RAR)

The SAP S/4HANA Revenue Accounting and Reporting (RAR) module takes the place of the SD Revenue Recognition module in SAP ECC. RAR is an additional feature that follows the updated revenue recognition model outlined in International Financial Reporting Standard 15 (IFRS 15). It includes enhanced contract management capabilities to ensure compliance with IFRS 15 while also streamlining revenue recognition processes.

SAP Fiori User Interface: A Distinctive Approach

SAP S/4HANA brings in a fresh user interface called SAP Fiori, which offers users a unified and seamless experience. SAP Fiori enhances productivity by enabling faster and more precise completion of tasks. This results in quicker onboarding and training processes, while also enhancing the overall user satisfaction. Additionally, it allows for the development of customized enterprise applications that are compatible with various devices.

What sets SAP ERP apart from SAP S 4HANA?

Comparing products in a thorough and detailed manner is made easier with the assistance of this tool. It allows for an in-depth analysis of features, enabling users to make informed decisions. For instance, when comparing SAP ERP and SAP S/4HANA, it becomes evident that they serve different types of organizations.

On the other hand, SAP S/4HANA caters more towards larger enterprises operating at an enterprise level. These organizations typically have complex structures and require advanced solutions to manage their operations effectively. With its robust features tailored for such requirements, SAP S/4HANA offers comprehensive support for these enterprise-level organizations.

To illustrate this further with practical examples: imagine a small retail store looking to implement an efficient system to handle inventory management, sales tracking, and financial reporting. In this case, utilizing SAP ERP would be highly beneficial as it covers all essential aspects while being suitable for smaller-scale operations.

Benefits of Moving to SAP S/4HANA

In 2021, 72% of businesses said the biggest benefit of SAP S/4HANA was improved efficiency , followed by greater satisfaction (61%). Other benefits of moving to SAP S/4HANA include:

Improved connectivity with other SAP solutions, reduced expenses including operational and ownership costs, streamlined data models resulting in a smaller database size, enhanced productivity and performance through automated processes, quicker and more informed decision-making capabilities, and increased overall profitability.

Reasons to Transition from SAP ECC to S4 Hana

1. Enhanced Performance: The utilization of in-memory technology in SAP S/4HANA enables quicker data processing and real-time analysis, resulting in improved performance and faster decision-making capabilities.

3. Advanced Analytics: With its advanced analytics capabilities, SAP S/4HANA allows for better insights into business data, enabling companies to make informed decisions based on accurate information.

4. Increased Flexibility: By migrating to SAP S/4HANA, organizations gain greater flexibility as the system supports both cloud-based and on-premise deployment options.

5. Improved User Experience: The user interface of SAP S/4HANA is intuitive and user-friendly, enhancing productivity by providing a seamless experience for end-users.

6. Real-time Reporting: Real-time reporting capabilities offered by SAP S/4HANA enable businesses to access up-to-date information instantly, facilitating timely decision-making.

8. Future-readiness: As a modern digital platform, adopting SAP S/4HANA positions businesses well for future advancements such as machine learning, artificial intelligence (AI), Internet of Things (IoT), etc., allowing them to stay competitive in the evolving market landscape.

Why Wait?

Migrating from SAP ECC to SAP S/4HANA can be a challenging task due to the numerous differences between the two systems. However, there are compelling reasons for making this transition, including the impending 2027 maintenance deadline for SAP ECC.

Distinguishing SAP FICO from S4 Hana

SAP S/4HANA Finance offers enhanced flexibility in terms of customizing reports and analytics compared to its predecessor, SAP ECC. With the introduction of the new module called S/4HANA Financials, users can experience a more user-friendly interface that allows for easier customization of reports and analytics according to their specific requirements.

On the other hand, SAP FICO excels in managing large volumes of data efficiently when compared to S/4HANA Finance. This traditional SAP ECC module has been widely used by organizations for handling extensive financial data and providing robust financial management capabilities.

The transition from SAP ECC to SAP S/4HANA brings about significant changes in terms of functionality and technology. One notable difference is the adoption of an in-memory database with HANA technology in S/4HANA, which enables faster processing speeds and real-time analysis. This shift empowers businesses with quicker access to critical financial information for making informed decisions promptly.

ECC and s4 in SAP: An Introduction

By leveraging this innovative technology, SAP S/4HANA offers several benefits over its predecessor. Firstly, it enables real-time analytics and reporting by providing instant access to up-to-date information without requiring time-consuming data extraction or batch processing. This empowers businesses with timely insights for better decision-making.

What are the drawbacks of SAP s4 Hana?

There are several issues with the current functionalities of SAP ECC and its user interface. These include:

1. Complexity: Many functionalities within SAP ECC are complex, making it difficult for users to navigate and utilize them effectively.

2. Outdated User Interface: The user interface of SAP ECC is no longer up-to-date, which can lead to confusion and inefficiency in performing tasks.

4. Multiple Steps for Transactions: When creating a new transaction, such as an order, users have to go through multiple steps, adding complexity and time-consuming processes.

These challenges highlight the need for a more modern and streamlined solution like SAP S/4HANA that addresses these limitations and provides enhanced functionality and usability.

Is SAP s4 Hana considered an ERP?

SAP S/4HANA Cloud Public Edition is a ready-to-run cloud ERP that delivers the latest industry best practices and continuous innovation.

The significance of S 4HANA in SAP

1. Technology: One of the main differences is the underlying technology used. SAP ECC runs on traditional databases, while SAP S/4HANA is specifically designed to run on the in-memory database called HANA. This means that S/4HANA can process data much faster and provide real-time insights for businesses.

2. Data Structure: Another difference lies in their data structures. ECC follows a row-based data structure, where each transaction creates a new entry in the database table. On the other hand, S/4HANA uses a columnar storage format, which allows for better compression and faster processing of analytical queries.

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