Report on the Differences Between SAP ECC and SAP S/4HANA Systems

This report provides a comparative analysis of SAP ECC and SAP S/4HANA, two prominent enterprise resource planning (ERP) systems. It begins by outlining the fundamental differences between the two, focusing on their underlying database structures and key functional areas such as financial accounting and revenue recognition. The report then delves into the operational benefits of upgrading from ECC to S/4HANA, highlighting improvements in transaction processing speed and reporting capabilities. Furthermore, it explores the strategic business advantages, including enhanced data analysis and the potential for new revenue streams. The discussion also covers the associated costs, such as hardware requirements and migration expenses, providing a balanced view of the transition. The conclusion summarizes the benefits of migrating to S/4HANA, including increased agility, resilience, and cost-effectiveness.

Management Information
System

Table of Contents
Introduction......................................................................................................................................1
1. Difference between SAP ECC & SAP S/4HANA..................................................................1
2. Operational benefits & cost from ECC to S/4HANA.............................................................1
3. Strategic business benefits & cost from upgrading from ECC to S/4HANA.........................2
Conclusion ......................................................................................................................................2
References........................................................................................................................................3

Introduction
SAP ERP denotes a software which is developed via German company. It is liable for
incorporating key business functions of firm. Business processes comprises of operations like
materials management, financials, corporate services and human capital management
(Kozeļcevs, 2020). This report will provide some essential details associated with ECC and
S/4HANA.
1. Difference between SAP ECC & SAP S/4HANA
SAP ECC denotes legacy suite for enterprise applications which is designed for executing
on third party database. SAP HANA implies in-memory database which is designed for
accelerating SAP application along with business processes which they support. The difference
between these two is specified below:
Basis for
Differentiation
SAP ECC SAP S/4HANA
Database This can be executed on IBM DB2,
Oracle, etc.
This will only execute on HANA
by taking leverage by in-memory
design principles and capabilities
possessed by SAP HANA.
Unison of FI The FI GL accounts within SAP
ECC can be mapped with CO
primary cost entities.
The universal journal utilises one
field for storing both cost
elements and GL accounts.
Accounting This utilises SD Revenue
Recognition and then this is
replaced via SAP S/4HANA
(Kulkarni, 2019).
It utilise RAR (Revenue
Accounting and Reporting), is
based on US-GAAP,FRS or IAS
through which revenue based
events can be recognised.
Output Management The message determination with
NAST table is utilised.
BRF+ (Business rule framework)
is utilised within this.
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2. Operational benefits & cost from ECC to S/4HANA
The benefits that are being provided by SAP S/4HANA are specified below:
 It will enable top refine the business performance. High speed of processing of
transactions and reporting are major assets.
 This allows firm to conduct activities such as execution, formulation of plans, analysis
and reports. In addition to this higher amount of information can be processed in shortest
time frame.
 It enables individuals within formulation of decisions for growth of the firm. This will
also impart high levels of agility to the business.
The cost associated with upgrading from ECC to S/4HANA includes that it executes their
operations on standard Intel x86 servers and IBM power servers. It depends on the firm which
server they want to make use of (Kulkarni, 2019). Though the initial hardware cost may be high
but the benefits attained by this will be high like online footprints can be reduced.
3. Strategic business benefits & cost from upgrading from ECC to S/4HANA
The long term advantage that will be attained is that higher amount of information can be
analysed within shorter frame of time. This implies that user can have instant insight into data
from any device and data. Firms will also be able to have new revenues and more profits.
In terms of cost of migration it can be understood in context of speed like 10TB ERP
system will become 1TB or even less than this which means that time for backup and restore will
be declined by around 10x and even more. This further allow usage of single CPU board that
have higher speed data access from certain cores (VIOREL-COSTIN, 2019). It implies that firm
will have cost efficient solutions in longer time frame. This will assist within creation of new
solution to acknowledge the needs of the business.
Conclusion
From above it can be concluded that by migrating ECC to S/4HANA firms can have high
benefits in terms of agility, resilience and will provide a cost effective solution in terms of future.
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References
Books & Journals
Kozeļcevs, K., 2020. Modification Effort Estimation in S/4HANA and SAP ECC Systems.
Kulkarni, S., 2019. Development in S/4HANA. In Implementing SAP S/4HANA (pp. 37-56).
Apress, Berkeley, CA.
Kulkarni, S., 2019. SAP S/4HANA Overview. In Implementing SAP S/4HANA (pp. 1-12).
Apress, Berkeley, CA.
VIOREL-COSTIN, B.A.N.Ț.A., 2019. THE DIFFICULTIES OF TRANSFORMATION SAP
ERP SYSTEM FROM ACTUAL LANDSCAPE TO S/4HANA DIGITALIZATION
ENVIRONMENT. A CASE STUDY. Annals of'Constantin Brancusi'University of
Targu-Jiu. Economy Series, (2).
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