SAP S/4HANA Review: Historical Overview, Differences with SAP FICO, Benefits, and Companies Using It

Table of Contents
SAP S/4HANA Review.................................................................................................. 1
Historical review of SAP S/4HANA............................................................................1
Difference between SAP S/4HANA and SAP FICO.....................................................2
Sap FICO framework............................................................................................. 3
SAP S/4HANA enterprise management framework...............................................5
Benefits of SAP S/4HANA......................................................................................... 6
Companies using SAP S/4HANA............................................................................... 7
List of reference......................................................................................................... 9
SAP S/4HANA Review.
Historical review of SAP S/4HANA
The amount of information in business firms is increasing at an alarming rate
hence the vital need of sufficiently controlling and disseminating raw data in
the firm departments. In today’s business world, in order for companies to
match up to the rising competition, they need to be creative, dynamic and
researched based to survive stiff tech-based competition and to be vital and
afloat in a regularly evolving tech-based innovations in this information era,
this is basically where data processing algorithms gets into the game. Most
of the world’s most renowned fortune 500 companies are investing
tremendous sums of money in availing the much needed information
systems aiming to make their businesses more effective. This information
(IF) are made up of groups of elements and structures that is put together in
a manner that enables the running of the intended function (The institute of
Electricals and Electronic Engineering, 2010). Examples of such information
systems include the Enterprise Resource Planning (ERP) Systems, Product
Data Management (PDM) Systems, Customer Relationship Management
(CRM) Systems and Supply Chain Management (SCM) Systems. While the
value of these systems cannot be over emphasized it is important to note
that, among all these varieties of Information Management Systems, the
Enterprise Resource Planning (ERP) systems which over time has
undoubtedly be the most celebrated tech-based business management
systems, granting companies the value of real time capabilities and flawless
communication. ERP is a software solution that works by integrating
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businesses functionalities and information sourced from different systems
into one system to be accessed within a firm (Wognum and Krabbendam,
2010). (Shehab and Supramanium, 2011) mimicked an ERP System to an
integrated software package that is capable of managing, controlling and
having general administrational control on the available organizations
resources. In accounting, which is one of the most important departments of
any business firm, ERP is dominantly used as a database management
software that is facilitating and supporting all the financial processing and
operations in the business which include the manufacture sector, finance
marketing aspects, human resources management and so much more. In
simple terms, the primal target of an ERP is to have a single, fully integrated
financial algorithm for the entire company and its departments. The dynamic
change of the entire company’s information accrued from all functional
departments, processing and operations etc. demands that an ERP system
have a very high level sophistication hence, the companies through their
departments are required to set aside enough resources to plan, train its
staff for an sophisticated implementation of an ERP algorithm. The demand
and cost associated with these ERP systems gave rise to vendors such as
SAP and Oracle. This paper will discuss SAPS ERP system with particular
emphasis on SAP S/4HANA finance and shall attempt to give a brief historical
overview of SAP S/4HANA, its differences as with the current SAP ERP FICO
and the benefits of SAP S/4HANA Finance for businesses.
Difference between SAP S/4HANA and SAP FICO
SAP is an acronym of System Application Products. As I mentioned earlier,
SAP is one of the most widely used and quality accredited ERP application.
SAP uses ERP algorithms in seeking to increase the quality of the services
that are offered by the organizations’ resource planning management control
and absolute control of all operations. SAP algorithm special kind of
algorithm software that works by integrating activities across functional
departments, starting with products planning, parts purchases, inventory
controls, product sales and distribution, plant maintenance, human resource,
quality control as well as financial control. SAP software applications can
integrate many functions but SAP S/4HANA Finance is our main focus in this
study.
Considering the fact that, it is virtually next to impossible not to encounter
the confusion around SAP S/4HANA Finance, therefore, it is of paramount
importance to highlight all information about SAP S/4HANA and all its
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functionalities aimed at making distinguishable from other related financial
algorithms and thus making it understandable, and for me to be able to
generate an understanding on what SAP S/4HANA Finance is. To make this
fundamental understanding easier, it is best to begin with the history
relationship between the SAP algorithm and the SAPS/4HANA, since SAP
HANA is highly related to both SAP S/4HANA Finance and SAP. So what is SAP
S/4HANA Finance? Well, before I give an intricate solution to that crucial
query, let me start by defining what SAP S/4HANA is. SAP S/4 HANA is the
SAP ERP version 6.0 algorithm that is fully and sufficiently capable of
executing on SAP HANA database. SAP S/4HANA Finance sinks further in, as
in; important elements components of the FI/CO algorithm have been
engulfed into it to improve its performance to its maximum level thus
advantaging the SAP HANA’s potential. SAP’s, SAP (version 1.0) that was
released five years ago, in the mid of 2014 year was an add-in to SAP HANA
optimization version for the Financial Accounting algorithm in SAP Business
systems. A year later, 2015, SAP Simple Finance (version 2.0) was released
to the public and business use as part of the SAP S/4HANA product. SAP
Simple Finance version 2.0 became the designed and recorded successor of
SAP Simple Finance version 1.0. The term, SAP Simple Finance went on to
become obsolete within six months after the release of its second version, by
the month of September 2015 and was replaced with the term SAP S/4HANA.
Currently, S/4HANA is available as both cloud and on-premise versions. The
cloud version is continuously been improved with preceding release in
approximate subsequently close release dates. The 1503 release date was
preceded by 1505, 1508 and 1511 respectively having a unique naming style
technique which is based on two categories; the first one begin the number
15 which picked from the year of its release while the second begin number
based from on the month of release. For instance a 2015 November release
will be named 1511.
I would confidently proclaim that, SAP S/4HANA epitomizes what can be said
to be the power of unity. According to my view, introducing the universal
journals is taking SAP closer to been a single accounts transaction algorithm.
This means that, the posting to various individual ledgers, for example,
material ledger, Asset Accounting (FI-AA) and CO, has been swapped by
posting to one unified journal. In trying to explain this in operational terms, I
would say that every business in the SAP General Ledger or Classical Ledger,
CO has been put in a unified journal, of course with an exemption of the co-
hosting based profitability analysis. So, why is this big deal? Well, it is
definitely a big deal because, I dare say, in one fell Swoop, SAP through the
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SAP S 4/HANA accounting module has greatly reduced the numerous
instances of data redundancy and duplication across all FI modules. Yes, I
get it, this spells despair for all those of you in the coding block but I’d say,
do not despair because ACDOCA can be extended to include the coding
block. One of the deeply painful aspects of implementing FI/CO in an
organization has been the delayed and manual reconciliation of CO postings
to FI. However, since the advent of SAP’s S/4HANA Finance, this is now
instantaneous and automatic. The question hanging on everyone’s mind is,
what is FI-CO and how is it related to S/4 HANA Finance.
Well, SAP S/4HANA Finance is the latest version of SAP HANA which is an in-
memory, columns- based, key database manager produced and marketed by
SAP whereas SAP-FICO which essentially stands for Financial Accounting and
Controlling is an important module of ERP and both FI and CO modules store
the financial transactions data. I could say that, SAP S/4HANA is a product of
SAP HANA which is basically a data report tool in SAP and is a technical
module whereas SAP FICO is a functional module where one could manage
all activities related to accounting and is integrated with various modules
such as MM, SD and PP etc.
Sap FICO framework
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SAP FICO
FI
Internal factors
CO
External factors
 Balance sheet
 Cash flows
 Statements on
incomes
 Reports on cost
center
 Profits, loss and
sales analysis