Business Reasons to go with Green, Brown, or Blue!

SAP S/4HANA moves must always address the question of how to approach the project? While the justification for the project comes from business needs, the actualization depends mainly on IT considerations. The decision you arrive at has a significant impact on realizing the promised business benefits that justified the project expense. It would also substantially influence your ability to leverage the new capabilities of SAP S/4HANA. There are three main pathways to your desired destination at a high level – Greenfield, Brownfield, and Bluefield (aka Hybrid).  

I will try here to summarize the various business situations that warrant each of the color choices! Please note these are general guidelines, and any single criterion can overturn a decision to its individual choice!

Greenfield (aka new implementation)

A greenfield approach can take one of two general forms –

1. Big-bang scenario to build a new SAP S/4HANA instance and cut over to the new system.
2. Phased roll-out to migrate the individual business units sequentially from your legacy SAP ERP application to the new system.

Greenfield is preferred in the following general circumstances –

• If a strategic redesign of the business processes is in scope.
• If a move to standardization is in scope.
• If you cannot convert the system technically in a single step. A single-step conversion is possible for the SAP ECC single-stack or Unicode system. The combined cost of an upgrade to SAP ECC6 or a Unicode upgrade followed by a conversion to SAP S/4HANA is too high.
• If landscape consolidation and process harmonization are in scope.
• If there is a need for business process redesign for either growth needs or cost savings.
• If the current SAP system does not follow best practices or relies on dated functionality. 
• If there are large, overcomplicated, historically grown systems.
• If the plan is to make extensive use of SAP Best Practices and SAP standard content.
• If the plan is to roll out the system on a company-code-by-company-code basis.
• If a merger is in scope, merging companies will often agree on a new neutral set of best practices. 

Brownfield (aka system conversion)

A brownfield approach can turn your existing SAP ERP system into an SAP S/4HANA system in a one-step procedure with a single downtime. It generally comprises the following –

1. A database migration to SAP HANA
2. A conversion of the data from legacy SAP to S/4HANA. 
3. Replacing legacy application code with SAP S/4HANA application code

This approach is preferred in the following general circumstances –

• If it is an IT-sponsored project that is meant to lay the foundation for incremental innovation projects driven by the business.
• If there is a requirement to retain all data in the system.
• If there is a high number of interfaces.
• If there is a plan to implement incremental innovations after go-live.
• If there is a need to preserve all the custom enhancements and modifications to support the company’s unique way of operating

Bluefield (aka selective data transition)

Selective data transitions encompass a variety of scenarios that go beyond the standard options of greenfield and brownfield. It requires specialized services and tools and often entails additional effort and cost. There are a host of options that need to be evaluated carefully. 

This approach is preferred in the following general circumstances –

If there is a need to consolidate multiple SAP ERP systems into one and there is a need to load historical data from all SAP ERP systems subject to consolidation.

• If the system is in good shape and there is a need only to change a part of the system configuration or functionality while keeping the rest as-is.
• If there is a need to replace an outdated system with a new one built upon best practices, in addition to loading specific historical transactional data. 
  • There needs to be complete clarity on what data is necessary to enable the business operations.
  • Requires deep knowledge of both the data structures and the dependencies between the business objects. Failing to understand these dependencies poses a risk of data inconsistencies.
  • When migrating historical data, there is an additional cost for the services needed for extensive testing that is required for selective data transition scenarios, such as end-to-end integration tests on migrated productive data.
• If a selective data transition (Bluefield approach) is in the books, it is strongly advised to engage SAP since they have the necessary tools and knowledge to make it work.

Generally speaking, around 90% of SAP S/4HANA moves are either Greenfield or Brownfield, and the rest choose Bluefield due to their specific situations. In the end, each customer needs to select the option that best allows them to continuously adapt SAP innovations in the future!