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Devraj Bardhan, Axel Baumgartl, Madalina Dascalescu, Mark Dudgeon, Piotr Górecki, Asidhara Lahiri, Richard Maund, Bert Meijerink, Andrew Worsley- Tonks SAP S/4HANA® An Introduction 5th, updated and revised edition 2025
Imprint This e-book is a publication many contributed to, specifically: Editor Megan Fuerst Acquisitions Editor Emily Nicholls Cover Design Graham Geary Photo Credit Shutterstock: 2439622859/© LuckyStep Production E-Book Kelly O’Callaghan Typesetting E-Book Satz-Pro (Germany) We hope that you liked this e-book. Please share your feedback with us and read the Service Pages to find out how to contact us. The Library of Congress has cataloged the printed edition as follows: Names: Bardhan, Devraj author Title: SAP S/4hana : an introduction / by Devraj Bardhan, Axel Baumgartl, Mark Dudgeon, Piotr Górecki, Asidhara Lahiri, Bert Meijerink, Andrew Worsley-Tonks, Richard Maund, and Madalina Dascalescu. Description: 5th edition. | Boston : Rheinwerk Publishing, [2025] | Includes index. Identifiers: LCCN 2024050438 | ISBN 9781493226542 (ebook) | ISBN 9781493226535 (hardcover) Subjects: LCSH: SAP HANA (Electronic resource) | Database management | Management information systems | Business enterprises--Data processing Classification: LCC QA76.9.D3 B3935 2025 | DDC 005.74-- dc23/eng/20241205 LC record available at https://lccn.loc.gov/2024050438
© 2025 by: Rheinwerk Publishing, Inc. 2 Heritage Drive, Suite 305 Quincy, MA 02171 USA info@rheinwerk-publishing.com Represented in the E.U. by: Rheinwerk Verlag GmbH Rheinwerkallee 4 53227 Bonn Germany service@rheinwerk-verlag.de ISBN 978-1-4932-2653-5 (print) ISBN 978-1-4932-2654-2 (e-book) ISBN 978-1-4932-2655-9 (print and e-book) 5th edition 2025, updated and revised
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Table of Contents Notes on Usage Table of Contents Foreword Preface 1 Introduction to the Intelligent and Sustainable Enterprise 1.1 Cornerstones of the Intelligent and Sustainable Enterprise 1.1.1 Operational Automation and Real-Time Steering 1.1.2 Intelligent Technologies 1.1.3 Business AI 1.2 Integrated Intelligent Enterprise 1.2.1 Layers of the Intelligent Enterprise 1.2.2 Next-Generation End-to-End Processes 1.2.3 SAP Business Technology Platform 1.2.4 Integration as an Enabler 1.3 Editions and Deployment Options 1.3.1 Products and Deployment Overview 1.3.2 SAP S/4HANA
1.3.3 SAP S/4HANA Cloud Private Edition 1.3.4 SAP S/4HANA Cloud Public Edition 1.3.5 Release Cycles 1.3.6 Deployment Considerations 1.4 Summary 2 Finance 2.1 The CFO’s Agenda 2.2 Industry Pain Points and SAP S/4HANA Benefits 2.2.1 Creating a Single Source of Truth 2.2.2 Digitizing Finance Processes 2.2.3 Embracing Business Insight Capabilities 2.3 Key Finance Functionality 2.3.1 Universal Journal 2.3.2 Universal Parallel Accounting 2.3.3 Material Ledger and Transfer Pricing 2.3.4 New Asset Accounting 2.3.5 Cash and Liquidity Management 2.3.6 Automated Revenue Management 2.3.7 Profitability Analysis 2.3.8 Predictive Accounting 2.3.9 Financial Closing 2.3.10 Financial Planning 2.3.11 Consolidation and Group Reporting 2.3.12 Intercompany Matching and Reconciliation 2.3.13 Tax and Compliance Management 2.3.14 Central Finance 2.3.15 Value Chain Analysis
2.4 Finance in SAP S/4HANA Cloud Public Edition 2.5 Outlook 2.6 Summary 3 Manufacturing 3.1 Industry Pain Points and SAP S/4HANA Benefits 3.2 Key Manufacturing Functionality 3.2.1 Product Master Optimization 3.2.2 Production Planning and Detailed Scheduling 3.2.3 Material Requirements Planning 3.2.4 Production Operations and Engineering 3.2.5 Complex, Discrete, and Component Assembly Manufacturing 3.2.6 Process Manufacturing 3.2.7 Supply Chain Analytics 3.3 Manufacturing in SAP S/4HANA Cloud Public Edition 3.4 Outlook 3.5 Summary 4 Supply Chain 4.1 Industry Pain Points and SAP S/4HANA Benefits 4.2 Key Supply Chain Functionalities 4.2.1 Data Model Simplification 4.2.2 Inventory Valuation and Advanced ATP
4.2.3 Extended Warehouse Management 4.2.4 Transportation Management 4.2.5 Catch Weight Management 4.2.6 Quality Management 4.2.7 Commodity Management 4.2.8 Stockroom Management 4.3 Supply Chain in SAP S/4HANA Cloud Public Edition 4.4 Outlook 4.5 Summary 5 Sales, Marketing, Commerce, and Service Management 5.1 Industry Pain Points and SAP S/4HANA Benefits 5.2 Key Sales Functionalities 5.2.1 Data Model Simplification 5.2.2 Sales Order Fulfillment and Replenishment 5.2.3 Condition Contract Settlement 5.2.4 Foreign Trade 5.2.5 Credit Management and Revenue Accounting 5.3 Key Marketing and Commerce Functionalities 5.3.1 Customer Relationship Management 5.3.2 Billing and Revenue Management 5.4 Key Service Management Functionalities 5.4.1 Optimized Service and Service Master Data Management 5.4.2 Service Parts and Service Agreement Management
5.5 Sales, Marketing, Commerce, and Service Management in SAP S/4HANA Cloud Public Edition 5.6 Outlook 5.7 Summary 6 Sourcing and Procurement 6.1 Industry Pain Points and SAP S/4HANA Benefits 6.2 Key Sourcing and Procurement Functionality 6.2.1 Operational Procurement 6.2.2 Invoice Management 6.2.3 Sourcing and Contract Management 6.2.4 Supplier Management and Procurement Analytics 6.2.5 Intelligent Procurement with AI and Machine Learning 6.2.6 SAP S/4HANA for Central Procurement 6.3 Sourcing and Procurement in SAP S/4HANA Cloud Public Edition 6.4 Outlook 6.5 Summary 7 R&D and Asset Management 7.1 Industry Pain Points and SAP S/4HANA Benefits 7.2 Key Research and Development Functionalities 7.2.1 SAP Enterprise Product Development 7.2.2 SAP Responsible Design and Production 7.2.3 SAP Enterprise Portfolio and Project Management
7.2.4 SAP Enterprise Product Engineering 7.2.5 SAP Product Lifecycle Management 7.2.6 SAP S/4HANA for Product Compliance 7.3 Key Asset Management Functionalities 7.3.1 SAP S/4HANA Asset Management 7.3.2 SAP Asset Performance Management 7.3.3 SAP Business Network Asset Collaboration 7.3.4 SAP Service and Asset Manager (Mobile) 7.4 R&D and Asset Management in SAP S/4HANA Cloud Public Edition 7.4.1 R&D in SAP S/4HANA Cloud Public Edition 7.4.2 Asset Management in SAP S/4HANA Cloud Public Edition 7.5 Outlook 7.6 Summary 8 Analytics and Reporting 8.1 The Evolution of Analytics 8.2 Operational Reporting 8.2.1 ABAP-Based Reports 8.2.2 Embedded Analytics 8.2.3 Native SAP HANA Applications 8.2.4 Embedded SAP BW/4HANA and SAP Business Planning and Consolidation 8.2.5 SAP Analysis for Microsoft Office 8.3 Enterprise-Wide Reporting 8.3.1 SAP HANA Enterprise Analytics 8.3.2 SAP BW/4HANA 8.3.3 SAP Datasphere
8.3.4 SAP Analytics Cloud 8.3.5 SAP BusinessObjects Business Intelligence 8.3.6 SAP Profitability and Performance Management 8.4 Reporting in a Hybrid Landscape 8.5 Cognitive Analytics and Generative Artificial Intelligence 8.6 Big Data Analytics and Data Fabric 8.7 Summary 9 Industry and Preconfigured Solutions 9.1 The SAP Strategy for Industry Solutions 9.1.1 SAP Industry Solutions in the Core 9.1.2 The Scope of SAP Industry Solutions 9.2 Solution Options from SAP 9.2.1 SAP Best Practices 9.2.2 SAP S/4HANA Fully Activated Appliance 9.2.3 Enterprise Management Layer for SAP S/4HANA 9.2.4 Industry 4.0 Solutions 9.2.5 SAP’s Industry Solutions 9.3 SAP S/4HANA Industry Clusters 9.3.1 Energy and Natural Resources 9.3.2 Service Industries 9.3.3 Consumer Industries 9.3.4 Discrete Industries 9.3.5 Financial Services 9.3.6 Public Services 9.4 Adapting to Global Change 9.5 Summary
10 SAP S/4HANA Cloud Public Edition 10.1 Considerations and Value Proposition 10.2 Core Functional Capabilities 10.3 Deployment 10.3.1 Fit-to-Standard 10.3.2 Deployment Resources 10.3.3 System Landscapes 10.3.4 SAP Signavio Process Navigator 10.3.5 SAP Central Business Configuration 10.3.6 Extensibility 10.4 SAP S/4HANA Cloud Private Edition 10.5 Content Lifecycle Management 10.6 Summary 11 SAP S/4HANA and the SAP Landscape 11.1 Sourcing and Procurement: SAP Ariba and SAP Business Network 11.1.1 Sourcing and Contracts 11.1.2 Requests and Purchases 11.1.3 Invoices and Payments 11.1.4 Intelligent Spend Management and SAP S/4HANA 11.2 Contingent Workforce Management: SAP Fieldglass
11.2.1 Vendor Management System 11.2.2 SAP Fieldglass and SAP S/4HANA 11.3 Travel and Expense Management: SAP Concur 11.3.1 Travel Spend Management 11.3.2 NextGen UI 11.3.3 SAP Concur and SAP S/4HANA 11.4 Human Resources: SAP SuccessFactors 11.4.1 Employee Data 11.4.2 Talent Management 11.4.3 SAP SuccessFactors and SAP S/4HANA 11.4.4 SAP Human Capital Management for SAP S/4HANA 11.5 Customer Experience: SAP Customer Experience 11.5.1 Marketing 11.5.2 Commerce 11.5.3 Sales 11.5.4 Services 11.5.5 Customer Data 11.5.6 SAP CX AI Toolkit 11.5.7 SAP Customer Experience and SAP S/4HANA 11.6 Master Data Management: SAP Master Data Governance 11.7 Supply Chain Planning: SAP Integrated Business Planning for Supply Chain 11.7.1 Sales and Operations Planning 11.7.2 Demand Planning 11.7.3 Inventory Planning 11.7.4 Response and Supply Planning 11.7.5 Control Tower 11.7.6 SAP IBP and SAP S/4HANA
11.8 Billing: SAP Billing and Revenue Innovation Management 11.8.1 Subscription Order Management 11.8.2 Convergent Mediation 11.8.3 Charging 11.8.4 Invoicing 11.8.5 SAP Customer Financial Management 11.8.6 SAP Billing and Revenue Innovation Management and SAP S/4HANA 11.9 SAP Digital Manufacturing 11.9.1 SAP Digital Manufacturing for Execution 11.9.2 SAP Digital Manufacturing for Insights 11.9.3 SAP Digital Manufacturing for Edge Computing 11.9.4 SAP Digital Manufacturing and SAP S/4HANA 11.10 Summary 12 Sustainability and Climate Action 12.1 Environmental, Social, and Governance Regulations 12.1.1 Emissions Reporting 12.1.2 Regulatory Requirements 12.2 SAP Solutions for Sustainable Enterprises 12.2.1 SAP Cloud for Sustainable Enterprises 12.2.2 SAP Sustainability Control Tower 12.2.3 SAP Sustainability Footprint Management 12.2.4 SAP Sustainability Data Exchange 12.2.5 SAP Responsible Design and Production 12.2.6 SAP Green Token
12.2.7 SAP Green Ledger 12.2.8 Greenhouse Gas Emissions Planning and Simulation in SAP Analytics Cloud 12.2.9 Sustainability in SAP S/4HANA Core 12.3 Summary 13 SAP S/4HANA Architecture 13.1 The Journey from SAP ERP to SAP S/4HANA 13.1.1 SAP S/4HANA Architecture 13.1.2 SAP S/4HANA as the Digital Core 13.1.3 Integration of SAP Products in SAP S/4HANA 13.1.4 The Roadmap to SAP S/4HANA and Innovations 13.2 SAP HANA Platform 13.2.1 SAP HANA Database 13.2.2 Virtualization 13.2.3 Scalability 13.2.4 Recoverability 13.2.5 Considerations for RISE with SAP 13.2.6 SAP HANA Operations 13.2.7 SAP HANA Logical Deployment Options 13.2.8 SAP HANA Platform Services 13.3 Hyperscaler Architecture 13.4 SAP S/4HANA Security 13.5 SAP S/4HANA Data Models 13.6 User Interface and User Experience 13.7 Data Lifecycle Management 13.8 Development and Operations 13.8.1 SAP Cloud ALM
13.8.2 SAP Signavio 13.8.3 SAP LeanIX 13.8.4 Role of Solutions in the DevOps Lifecycle 13.9 Summary 14 Extensions through the Clean Core 14.1 Business-Driven Development 14.1.1 Connecting People and Data 14.1.2 Building Differentiating Cloud Applications 14.1.3 Integrate Applications and Data 14.1.4 Extending Core and Software-as-a-Service Solutions 14.2 Clean Core 14.3 SAP Business Technology Platform 14.4 Extensibility Options for the Intelligent Enterprise Suite 14.4.1 Overview and Considerations 14.4.2 Key-User Extensibility 14.4.3 Classic Extensibility 14.4.4 Side-by-Side Extensibility 14.4.5 Developer Extensibility via ABAP Cloud 14.5 SAP Business Accelerator Hub 14.6 Summary 15 Business AI Technologies
15.1 The Intelligent Enterprise and SAP Business Technology Platform 15.2 Industry 4.0 Solutions 15.3 Artificial Intelligence 15.3.1 SAP Business AI 15.3.2 SAP AI Core and SAP AI Launchpad 15.3.3 SAP AI Services 15.3.4 Joule 15.3.5 SAP Build Process Automation 15.3.6 SAP HANA Cloud Vector Engine 15.3.7 SAP Build Code 15.4 Generative AI Use Cases 15.4.1 Sustainability Product Ledger 15.4.2 Invoice Match and Verification 15.4.3 Financial Planning and Analysis 15.4.4 Asset Maintenance for Industrial Manufacturing 15.4.5 Consumer Packaged Goods 15.4.6 Oil and Gas Asset Maintenance for Upstream Plants 15.5 Summary 16 Adoption Paths 16.1 Assessing Your Adoption Options 16.1.1 SAP Readiness Check 16.1.2 SAP Discovery Center 16.1.3 SAP Signavio 16.1.4 SAP Solution Scout 16.1.5 SAP LeanIX 16.2 New Implementation
16.2.1 Adoption Approach 16.2.2 Considerations 16.2.3 SAP S/4HANA Migration Cockpit 16.3 System Conversion 16.3.1 Adoption Approach 16.3.2 Considerations 16.3.3 SAP Conversion Software, Tools, and Accelerators 16.3.4 SAP S/4HANA Conversion Prerequisites 16.3.5 Minimizing Downtime 16.4 Selective Data Transition 16.4.1 Adoption Approach 16.4.2 Considerations 16.5 SAP S/4HANA Preparation Activities 16.6 Summary 17 Implementation Method and Accelerators 17.1 What Is SAP Activate? 17.2 SAP Activate Methodology 17.2.1 Prepare 17.2.2 Explore 17.2.3 Realize 17.2.4 Deploy 17.2.5 Quality Gates 17.3 SAP Best Practices 17.4 SAP Activate Tools 17.4.1 Self-Service Configuration