The Chalfen Accuracy Checker: A Study into Mark Chalfen’s Accuracy on S/4HANA and SOH

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Executive Summary

  • For years Mark Chalfen provided information about HANA, S/4HANA and SOH to the market.
  • This is a study that measure’s Mark Chalfen’s accuracy.

Introduction

Mark Chalfen of Bluefin Solutions published a number of blog posts around S/4HANA, SOH and also HANA. This study was created in order to catalogue many (but certainly not all) of Chalfen’s statements to arrive at an average accuracy for Mark Chalfen.

The Method

This study is a document analysis of Chalfen’s blog posts for the listed topics. That is one half of the study. The other half is the reality of these items, which we were able to provide as we are the top research firm for HANA and S/4HANA.

  • Brightwork Research & Analysis has performed the most and the most extensive research of HANA and this website over 250 articles on HANA and S/4HANA (the ERP system mated to HANA).
  • Brightwork Research & Analysis is also one of the only information providing entities that cover SAP that is not financially tied to SAP (or to any other vendor) (for example, Forrester, Gartner, Nucleus Reseach and all of the US-based IT media outlets are financially connected to SAP).

This lack of financial relationship allows us to publish our analysis of accuracy without concern for retaliation on the part of the SAP.

What Statements Are Measured

In some cases, Chalfen made statements such as HANA worked with S/4HANA — which is true but would be like crediting someone for saying the “sun rises in the East.” Therefore, the study measured statements, where something more than elementary and universally agreed-upon observations, were made.

The Evidence for the Percentage Rating

  • What you see below in the Chalfen Accuracy Checker Table. This table (which is searchable, see the search box at the top) is designed to provide a listing of the measured statements.
  • Further down in the article is the list of Chalfen’s specific statement or quotation and our explanation for the accuracy rating.

Mark Chalfen Accuracy Checker

Article Subject
Mark's Statement Topic
Accuracy %
Decision Between S/4HANA and Suite on HANAFrom ECC to Suite on HANA100
Decision Between S/4HANA and Suite on HANAFrom ECC to S/4HANA 1100
Decision Between S/4HANA and Suite on HANAFrom ECC S/4HANA 270
Decision Between S/4HANA and Suite on HANADuration of S/4HANA Cloud Implementation50
Decision Between S/4HANA and Suite on HANASAP in the Cloud10
HANA is the Answer, What is the Question?On Vishal Sikka's HANA Address100
HANA is the Answer, What is the Question?On HANA's Technology Speaking for Itself0
HANA is the Answer, What is the Question?On HANA and Reports and Processes0
HANA is the Answer, What is the Question?On the Flexibility of Data with HANA0
What Customers Can Take Away from SAPPHIRE 2013?On EHP and HANA Specific Apps0
What Customers Can Take Away from SAPPHIRE 2013?On Future Proofing with SOH0
What Customers Can Take Away from SAPPHIRE 2013?SAP on Matching Smaller SaaS Vendors in UI0
What Customers Can Take Away from SAPPHIRE 2013?On Fiori's Future0
What Customers Can Take Away from SAPPHIRE 2013?On Fiori's Efficiency0
What Customers Can Take Away from SAPPHIRE 2013?HANA Had a Significant History by 20130
What Customers Can Take Away from SAPPHIRE 2013?HANA is a Brand30
What Customers Can Take Away from SAPPHIRE 2013?HANA is a Platform and Data Warehouse and More0
What Customers Can Take Away from SAPPHIRE 2013?HANA (Overall) Confusion100
What Customers Can Take Away from SAPPHIRE 2013?HANA Multi Item Confusion100
What Customers Can Take Away from SAPPHIRE 2013?HANA is Perceived as Expensive50
What Customers Can Take Away from SAPPHIRE 2013?HANA as Ahead of the Competition50
What Customers Can Take Away from SAPPHIRE 2013?HANA Performance Success Stories0
SAP Simple FinanceOn Run Simple0
SAP Simple FinanceBusiness Concern Around Tables and Data Sorting100
SAP Simple FinanceHANA's Size Reduction Will Reduce Costs50
SAP Simple FinanceStandard Database Size Reduction0
SAP Simple FinanceDatabase Reduction with Simple Finance0
SAP Simple FinanceRemoval of Aggregates Enables Processes to Run More Efficiently0
SAP Simple FinanceThe SAPGUI is Dated100
SAP Simple FinanceThe Only Downside of the Finance Screens is the Coverage0
SAP Simple FinanceS/4HANA Migration and Upgrade Will Take 3 Months0
SAP Simple FinanceSlashing HANA Costs0
SAP Simple FinanceReduction of Aggregates Speeds Month End Process0
SAP Simple Finance"In Memory" Speeds SOH Reporting20
SAP Simple FinanceHEC and SAP Cloud Will Reduce Costs of Migration0
SAP Simple FinanceS/4HANA Has Good 2014 Option0
SAP Simple FinanceS/4HANA is Live on HEC20
SAP Simple FinanceSimple Finance is a Fresh New Way to Systematize Financial Processes0
SAP Simple FinanceCustomers Have Custom Transactions75
S/4HANA: What Customers Want to KnowFiori Screens for S/4HANA Cloud100
S/4HANA: What Customers Want to KnowFiori Screens for S/4HANA CloudThe Number of SOH Live Instances20
S/4HANA: What Customers Want to KnowThe Number of SOH Live Instances 265
S/4HANA: What Customers Want to KnowThe Number of SOH Live Instances 2The Number of SOH Live Instances 20
S/4HANA: What Customers Want to KnowERP Data Footprint Will Reduce Size for BW0
S/4HANA: What Customers Want to KnowMonth End Process Data Transfer Improved20
S/4HANA: What Customers Want to KnowS/4HANA = Simplification0
S/4HANA: What Customers Want to KnowMoving to HANA Paves Way to Move Other Solutions to HANA0
Enabling Business Transformation with S/4HANAAsking About Costs and Time to Implement S/4HANA is the Wrong Question0
Enabling Business Transformation with S/4HANAS/4HANA Reshapes the Position for your IT Systems0
Enabling Business Transformation with S/4HANASystem Conversion100
Enabling Business Transformation with S/4HANAS/4HANA and Business Process Modification0
Enabling Business Transformation with S/4HANAThe Reason for S/4HANA Greenfield0
Enabling Business Transformation with S/4HANAS/4HANA's Clean and Simple Solution20
Vanilla SAPWhat Customers Use Vanilla SAP?100
Vanilla SAPNaive to Believe Customers Can Use Vanilla SAP100
Vanilla SAPRemove Risk of Development with Vanilla SAP?0
Vanilla SAPSAP Consultancies Quoting Vanilla SAP50
Vanilla SAPVanilla SAP Implementations That Are Overbudget are Seen as Failures50
Vanilla SAPThe ERP System Can Cope with Most Business Processes without Customization0
Vanilla SAPCustomers Will Look at SAP and Not Be That Impressed100
Vanilla SAPERP is Implemented to Tackle A Specific Business or Technical Issue20
Vanilla SAPCustomers Should Try to Determine What Vanilla Means to Them75
Have Enhancement Packs Lived Up to the Hype?SAP ERP Releases100
Have Enhancement Packs Lived Up to the Hype?Majority of ERP6 Were Purely Technical100
Have Enhancement Packs Lived Up to the Hype?ERP6 Is Better Than Previous Versions100
Have Enhancement Packs Lived Up to the Hype?"Negatives with EHPs
"
100
Have Enhancement Packs Lived Up to the Hype?EHP Living Up to Billing100
Have Enhancement Packs Lived Up to the Hype?Effort to Install EHPs100
Is HANA the New iPad?In Memory Computing is New0
Is HANA the New iPad?New Innovative Hardware0
Is HANA the New iPad?HANA's Competitors0
Is HANA the New iPad?HANA is the First True In Memory DB100
Is HANA the New iPad?Usability and Performance and Uptake of HANA0
Is HANA the New iPad?In Memory DB Changes So Much0
Is HANA the New iPad?Apple and SAP are Similar in Innovation0
Is HANA the New iPad?HANA Will be Synonymous with In Memory Computing50
What will SAP Business Suite by HANA Mean to CEO?Great and More Significant Benefits than IT Cost Savings0
What will SAP Business Suite by HANA Mean to CEO?Can SOH Assist and Achieve in Objectives0
What will SAP Business Suite by HANA Mean to CEO?SAP ERP as System of Record100
What will SAP Business Suite by HANA Mean to CEO?Real Time Analytics0
What will SAP Business Suite by HANA Mean to CEO?Leaders and Innovators Adopt New Functionality0
What will SAP Business Suite by HANA Mean to CEO?Promoting Challenge Internally Prior to SOH50
What I Learned from the SAP on HANA Press ConferenceSOH Becoming R/4100
What I Learned from the SAP on HANA Press ConferenceSOH Success Stories0
S/4HANA MaturityS/4HANA Uptake0
S/4HANA MaturitySimplification of S/4HANA0
S/4HANA MaturityThe Maturity of S/4HANA Finance0
S/4HANA MaturityOn Mark Chalfen Took a Client Live0
S/4HANA MaturityLarge ECC Expenses Futher Increase with S/4HANA0
S/4HANA MaturityStatement Regarding S/4HANA Maturity0

Chalfen’s Statements and Analysis

From ECC to Suite on HANA

If you have a current SAP ECC solution with a non-HANA database you can perform a technical migration to move to SAP Suite on HANA. You will need to perform an Enhancement Pack upgrade to Enhancement Pack 7 and then a database conversion to SAP HANA. This project will consist mainly of technical changes with various streams of functional testing to ensure all of the current processes and transactions work on the new system. All of the data you had within your SAP ECC system you will have in your SAP Suite on HANA system.

Our Analysis

This is true.

From ECC to S/4HANA 1

Again starting from the same point of SAP ECC you will also need to perform an Enhancement Pack upgrade to Enhancement Pack 7, perform a database conversion, and then you also need to perform a system conversion to the new SAP S/4HANA solution.

Our Analysis

This is a very good and concise explanation of the differences.

From ECC to S/4HANA 2

“From ECC to S/4HANA 1″Again starting from the same point of SAP ECC you will also need to perform an Enhancement Pack upgrade to Enhancement Pack 7, perform a database conversion, and then you also need to perform a system conversion to the new SAP S/4HANA solution. “Our AnalysisThis is a very good and concise explanation of the differences.”

Our Analysis

True, but understates the amount of work involved.

Duration of S/4HANA Cloud Implementation

The end to end duration of an S/4HANA Cloud deployment will be roughly 40% less than a comparative on-premise deployment. Therefore, the cost to deploy will be significantly less for a cloud deployment compared to an on-premise one.

Our Analysis

This may be true, but not relevant for most companies that can’t use S/4HANA Cloud. Even in 2019, S/4HANA Cloud has almost no uptake, and we have rated it as not worthwhile for use.

SAP in the Cloud

SAP has typically played in the on-premise market for ERP tools, however it is clear it’s now able to cross over both markets.

Our Analysis

False, SAP has shown no capability to cross over into the cloud market. This also seems to contradict Mark’s earlier point.

On Vishal Sikka’s HANA Address

Sitting in the audience in the UK you could hear a pin drop as Vishal spoke passionately about the agile implementation of HANA at a number of core customers. The stats and figures spoke for themselves and anyone following the twitter feeds would have been impressed with what they were reading. The tool itself has only been implemented by a core set of SAP foot soldiers. The common message was SAP wanted its customers to set it a challenge to see if HANA was up to the test.

Our Analysis

The response described was true, but it amazing considering everything that Vishal Sikka said about HANA was false.

On HANA’s Technology Speaking for Itself

The technology and solution seem to speak for themselves and from what I have read and heard the product will slowly evolve and grow.

Our Analysis

No, this is never true. But it turned out not to be true for HANA.

On HANA and Reports and Processes

All of the reports and processes that you have been told you can’t have in the past perhaps you can now.

Our Analysis

False. HANA did nothing to shorten the queues of reports sitting behind the BW (as one example)

On the Flexibility of Data with HANA

All of the flexibility of data and combinations of data that you could not get in a report you can now. Customers should not be concerned around the time it takes to create or prepare a report, and all data is now available with HANA.

Our Analysis

False. And made up. HANA did not positively impact any of these items. Long queues persist behind BW instances.

On EHP and HANA Specific Apps

If you are looking at performing an SAP Enhancement Pack upgrade, look past Enhancement Pack 6 and go to 6H. You will benefit from out-of-the-box system performance improvements of a factor of 3 (without any tuning), but also be able to consume new SAP HANA specific apps, such as Working Capital Management or Receivables Manager.

Our Analysis

False, many reports show HANA underperforming previous versions of DB2 and Oracle. Furthermore, this is inconsistent with SAP’s statements. McDermott claimed 100,000x increase in performance and Hasso Plattner stated zero latency with all processing on HANA.

On Future-Proofing with SOH

By performing this upgrade you can future-proof your organisation by enabling access to specific functionality within the Business Suite that is only available via HANA.

Our Analysis

False, no new functionality was coming for the Business Suite for HANA.

SAP on Matching Smaller SaaS Vendors in UI

SAP realised they should not look to try and match some of their smaller SaaS competitors. Instead, they need to overtake their competitors and define the future direction.

Our Analysis

False, SAP never did this, and in 2019, Fiori is still barely used by anyone.

On Fiori’s Future

Whilst this is great, is it just the start! There are many transactions that can be improved. Users who have worked with SAP Gui for many years are familiar with the screens, but the perception is that they are still clunky, slow, non-efficient and not as great an experience as many other software products.

Our Analysis

No, it was just the end. Fiori never attained adoption.

On Fiori’s Efficiency

Running SAP Fiori can add around an additional 10% of processing time, however by making the screens cleaner and fresher the user will have to enter less data and be able to navigate through their tasks in a more efficient manner.

Our Analysis

There was never any evidence this was true. Fiori is more attractive than SAPGUI, but it is not as efficient, and it is primarily optimized around displaying canned reports.

HANA Had a Significant History by 2013

SAP HANA has been around for a while now.

Our Analysis

How has HANA been around for “a while now?” This article was written in mid-2013, and HANA was not even a stable product through 2011 and much of 2012. As in entirely unimplementable.

HANA is a Brand

The key thing to me is that SAP HANA is just a brand and it is much more than just a product or a solution. Replace the word HANA with “in-memory computing” and it might become slightly more tangible!

Our Analysis

Nope, HANA is just a product — it was and is a database. SAP did try to position is as something broad reaching.

HANA is a Platform and Data Warehouse and More

The SAP HANA brand is a database, a platform, a data warehouse and more.

Our Analysis

No, HANA was and is a database.

HANA (Overall) Confusion

Many customers are still confused by it and believe the branding and messaging to be poor and confusing.

Our Analysis

Yes. Customers were confused in part because SAP’s messaging was so illogical and SAP kept saying HANA was everything.

HANA Multi-Item Confusion

Having one name for some many different things confuses customers and they are often left feeling unsure what exactly people are referring to when they talk about SAP HANA. Using the same name dilutes the message – SAP HANA is not just about performance and technology. There is a distinct lack of key messaging and focus from SAP around the use cases and business scenarios.

Our Analysis

Yes.

HANA is Perceived as Expensive

Many customers still perceive SAP HANA to be expensive.

Our Analysis

True, but this is not just a perception issue. In our research, we have concluded that HANA is the most expensive database of any other database.

HANA as Ahead of the Competition

They seem to be ahead of the competition…

Our Analysis

SAP was briefly ahead of the competition for “in memory” until around 2014. However, HANA was behind all of the other databases in every other aspect of the database. SAP never mentioned the areas they were behind.

HANA Performance Success Stories

…and have great success stories around performance and cost savings.

Our Analysis

False, SAP has shown no capability to cross over into the cloud market. This also seems to contradict Mark’s earlier point.

On Run Simple

“As part of this drive to “Run Simple” SAP has started by focusing on the core aspect of the majority of their ERP user base. I for one, would like to applaud SAP for making this move and I am very supportive of the direction it’s now taking.”

Our Analysis

Run Simple never meant anything. It was a marketing construct which was dropped within a few years.

Business Concern Around Tables and Data Sorting

“To be fair, a Financial Controller or Director will not care too much around tables and how data is sorted.”

Our Analysis

This is true. 

HANA’s Size Reduction Will Reduce Costs

“Moving to SAP HANA can be costly, however reducing the size of the database will reduce the costs of SAP HANA for customers.”

Our Analysis

Only because HANA was priced by GB, the only database to be priced this way.

Standard Database Size Reduction

“A standard migration to SAP HANA will see a reduction of size of 5:1 (old database size: SAP HANA database size).”

Our Analysis

The common database reduction is 30%.

Database Reduction with Simple Finance

“With SAP Simple Finance, the SAP HANA database can be reduced by a further 40-60%, (the amount will of course vary depending on the Finance modules being used).”

Our Analysis

False, this never happened on projects. It is odd to even read this proposal as even other SAP resources have tended to not repeat this.

Removal of Aggregates Enables Processes to Run More Efficiently

“Apart from the size reduction implications, the removal of aggregation tables will enable processes to be run more efficiently such as cost allocations and the ability to perform analysis within the SAP Business Suite on HANA environment rather than from a data warehouse.”

Our Analysis

This also never happened. SAP customers will continue to use a data warehouse. S/4HANA only has canned reports.

The SAPGUI is Dated

“The traditional SAP Gui UI is dated to say the least and, in reality, today’s users won’t accept working on the grey screens SAP made famous 20 years ago.”

Our Analysis

True, and widely known.

The Only Downside of the Finance Screens is the Coverage

“The only downside is that not all of the SAP Finance screens will get a SAP Fiori overhaul and will need to be consumed via the standard SAP Gui.”

Our Analysis

No, there are many other downsides to Fiori.

S/4HANA Migration and Upgrade Will Take 3 Months

“SAP has indicated that the migration and upgrade will take around 3 months, (take this as indicative).”

Our Analysis

Every S/4HANA project undertaken at this timeframe failed. So it did not take 3 months.

Slashing HANA Costs

“A further reduction to your database size due to the reduction of the aggregation tables slashing SAP HANA costs.”

Our Analysis

Footprint declines only around 30%. HANA is still the most expensive database in its category. TCO of HANA is even higher.

Reduction of Aggregates Speeds Month End Process

“The reduction of the aggregation tables will speed up the month-end processes as the need to reconcile Finance and Controlling data is removed as all of the data is held in a common structure”

Our Analysis

No, this is not true. Secondly, no S/4HANA projects went live in this timeframe, so it is even less relevant.

“In Memory” Speeds SOH Reporting

“The In-Memory functionality within SAP HANA can be utilised to speed up reporting within the SAP Business Suite system and in turn speed up tasks such as GR/IR clearing and cost allocations.”

Our Analysis

HANA has caused frequent problems with ERP, reporting speed increases but ECC or SOH is not designed around providing reports.

HEC and SAP Cloud Will Reduce Costs of Migration

“The first is to use the SAP HEC (Hana Enterprise Cloud). The SAP Cloud offering will reduce the initial cost of the migration and provide the management of the solution to a 3rd party”

Our Analysis

The HEC has been utterly incompetent. SAP Cloud should not be used, and barely is used even in 2019, five years after this was written.

S/4HANA Has Good 2014 Option

“The second is an on-premise option.”

Our Analysis

No, the on-premises version was also not ready to implement.

S/4HANA is Live on HEC

“Only SAP is live with this solution (via HEC) and there are a further nine customers who are in ramp-up.”

Our Analysis

No, this was not true. SAP produced a number of fake go-lives during this time and after. Those customers ramping up would have run into large failure rate.

Simple Finance is a Fresh New Way to Systematize Financial Processes

Whilst SAP Simple Finance is a fresh new way to systemise Finance processes.

Our Analysis

False, Simple Finance was not even connected to the rest of the ERP system at this time.

Customers Have Custom Transactions

“..it is worth noting that most of SAP’s current customers have a level of bespoke transactions. Some reports that have been built may report on the aggregation tables that are being removed and therefore these will have to be re-written. Not all of the SAP Fiori screens will meet business requirements and may require modification. All of these areas will increase the scope and the cost of an upgrade to SAP Simple Finance.”

Our Analysis

True. This is just one of the many reasons that S/4HANA was a very bad option. The most important factor being that S/4HANA could not be implemented in 2014. The statement is debited for being misleading, while its supporting features are true.

Fiori Screens for S/4HANA Cloud

“The Cloud-based solution will not have access to the traditional SAP Gui screens, only the SAP Fiori screens.”

Our Analysis

True, S/4HANA is entirely Fiori.

The Number of SOH Live Instances

“SAP Business Suite on HANA has been available for more than two and half years and there are over 1000 instances currently live globally.”

Our Analysis

We cannot specifically contradict this, but it seems very unlikely. Mark Chalfen normally reports numbers given to him from SAP which are in 100% of circumstances exaggerated.

The Number of SOH Live Instances 2

It’s reported that there are nearly 40,000 SAP ERP customers of which, as of this month, nearly 2000 are using SAP Business Suite powered by HANA (5% of the total ERP customer base).

Our Analysis

These are numbers reported from SAP, so they are exaggerated. That means the 40,000 number of ERP is also exaggerated. 2000 were not using SOH. Furthermore, how did this number drop in July 21, 2015 to 1000?

5TB Database Reduced by a Factor of 10

“This provides IT the ability to reduce the size of the database. An SAP ERP system that is currently 5TB could be reduced to less than ½ TB by moving to SAP Simple Finance due to the compression of SAP HANA, and the Finance add-on which removes the index tables, structures and duplicate data records.”

Our Analysis

There is no evidence that is occurred.

ERP Data Footprint Will Reduce Size for BW

This will reduce the volume of data that is required to be held within a SAP BW environment. It will also improve performance around data extraction from ERP into BW.

Our Analysis

There is no evidence that is occurred.

Month End Process Data Transfer Improved

“Additionally, business users now have the ability to run real-time analysis of financial information from SAP S/4 HANA. Historically, assessments and cost allocations would be run within the month-end process with the data then needing to be transferred to SAP BW to see the impact. The time lag resulted in the Finance team working late into the night and being dependent upon IT to transfer data from ERP to BW. This can now be removed, thus improving the efficiency of both teams and removing some of the pressure from the month-end cycle.”

Our Analysis

This made it sound like viewing BW reports was a huge effort with a huge lag. A month-end process is not a real-time type of reporting need.

S/4HANA = Simplification

“There are many different types of simplifications that SAP S/4HANA can achieve. One business case is to use it as a central solution to link multiple SAP ERP systems. It can be used to help reduce a customer’s SAP ERP landscape and the volume of SAP ERP systems. Moving an SAP ERP solution to the Cloud can also reduce the TCO of the environment.”

Our Analysis

Every single statement SAP made about simplification and S/4HANA was false. S/4HANA creates great upheaval due to the changes with S/4HANA.

Moving to HANA Paves Way to Move Other Solutions to HANA

“Moving to SAP HANA also paves the way to move other solutions onto HANA and reduce the size of existing systems. The benefits to the IT department are numerous.”

Our Analysis

False, there are no benefits to the IT department and the size decreases by roughly 30%. HANA proved to be too expensive and too unreliable to move other applications outside of BW.

Asking About Costs and Time to Implement S/4HANA is the Wrong Question

One of the first questions asked by the experienced SAP customer is “how long will it take to upgrade to SAP S/4HANA?”, followed by a question relating to the cost. Unfortunately that is the wrong question to ask.

Our Analysis

False, there are no benefits to the IT department and the size decreases by roughly 30%. HANA proved to be too expensive and too unreliable to move other applications outside of BW.

S/4HANA Reshapes the Position for your IT Systems

“SAP S/4HANA brings the ability to re-shape and position for your IT systems within your business processes and therefore it is time to add more value and use it to provide transformation.”

Our Analysis

False, S/4HANA, even if implementable at this time, would not have provided additional value. It was a technical upgrade.

System Conversion

“The system conversion aligns with the upgrade methodology that customers may be more familiar with. However, a system conversion will always require some form of functional changes as the current data needs to be converted to the new data models.”

Our Analysis

This is all true.

The Reason for S/4HANA Greenfield

“70% of all SAP S/4HANA customers (live and in-flight projects) have followed the new implementation approach. The common reason for this choice is that customers want to remove unwanted code and bespoke processes and try to align to the new functionality within SAP S/4HANA.”

Our Analysis

Not true, S/4HANA could not be implemented brownfield due to incompatibility. This entire paragraph is extremely misleading.

S/4HANA’s Clean and Simple Solution

“Starting with a clean and simple solution is a very attractive proposition for many customers.”

Our Analysis

False, SAP has shown no capability to cross over into the cloud market. This also seems to contradict Mark’s earlier point.

What Customers Use Vanilla SAP?

“However when I visit existing customers to help them solve their current problems none of them have Vanilla SAP. Some have SAP ERP boxes, but the volume of bespoke code that has been written makes their version of SAP very hard to upgrade. Some don’t even resemble a Vanilla SAP client as end-to-end processes have been bespoked within it.”

Our Analysis

True, clients think they can implement vanilla, but they can’t because SAP’s ERP does not cover many of their requirements, even though SAP sales said that it would.

Naive to Believe Customers Can Use Vanilla SAP

“Having the desire to start with a Vanilla SAP implementation shows a strong intention from the customer that they want to avoid costly developments. However, it is naive to believe that a large customer with multiple divisions and sites could fit their full processes into the standard Vanilla model.”

Our Analysis

True, but again leaves out the fact that the client was lied to by SAP during the sales process. Is Mark going to call out this practice, or bury the information?

Remove Risk of Development with Vanilla SAP?

“Customers sometimes try to remove the risk of developments by adopting the approach that they will bend their business processes to fit SAP, rather than the other way around. However let’s be clear, to remove the need for development, full end to end processing would need to be performed solely in SAP, and not in 3rd party systems.”

Our Analysis

Why is this true? This is a ridiculous proposal. The best of breeds have a better, not worse chance in meeting the customer’s requirements.

SAP Consultancies Quoting Vanilla SAP

“By asking SAP consultancies to quote for Vanilla SAP is one thing, but all this does is provide a cost associated to a project that wont actually be delivered.”

Our Analysis

Right, and consulting firms are happy to quote vanilla, so they can get their foot in the door.

Vanilla SAP Implementations That Are Overbudget are Seen as Failures

“If budgets are based around Vanilla SAP, and that is not delivered the budget will be exceeded and the project may be seen as a failure.”

Our Analysis

But in the vast majority of cases, the funding will continue, which is what the consulting firm cares about.

The ERP System Can Cope with Most Business Processes without Customization

“The ERP system from SAP can cope with most business processes from most industry sectors. One of the main benefits of the system is the integration between modules and processes. Therefore if a customer chose to have wall to wall SAP, and no other system, integration, data mapping and interfaces would not be a problem.”

Our Analysis

No this is false, but the multi-decade promise of ERP systems. The second part of the proposal may be true, but this has nothing to do with the question of meeting requirements. As with nearly all SAP consultants, Mark Chalfen puts SAP before the requirements.

Customers Will Look at SAP and Not Be That Impressed

“Whilst SAP spans a number of Industry sectors, the solutions in place are good not great. From experience customers will look at parts of SAP and not be that impressed when comparing it to their current IT systems.”

Our Analysis

True, although “good” is an exaggeration, but then why is SAP being implemented in the first place?

ERP is Implemented to Tackle A Specific Business or Technical Issue

“Normally when ERP is implemented it is to tackle a specific business or technical issue. It could be that the customer wishes to reduce the volume of common IS systems.”

Our Analysis

Customers constantly have consulting firms like Bluefin Solutions lying to them about what ERP systems can do. Most ERP systems are implemented because they are sold on false claims.

Customers Should Try to Determine What Vanilla Means to Them

“Before coming out with the cliché of “We want Vanilla SAP”, the customer should try and obtain what Vanilla SAP actually means to them. What will they gain from using the basic template, and what areas will they need to bespoke.”

Our Analysis

True, but companies cannot use vanilla SAP ERP. That is only during the sales phase that the assumption can be held.

SAP ERP Releases

“Back in 2006 SAP released a new delivery model. ERP6 was released and presented as the “go-to” release within the SAP ERP world. The difference with this version to the ECC5 version released a year earlier was that new functionality would be released via Enhancement Packages and therefore customers would not need to perform painful and costly upgrades to obtain the latest technology. This was a shift in direction for SAP and one that was well received. SAP said new functionality would be released every 6 months, and in 2007 the first Enhancement Package was released. In June 2011 the 5th Enhancement Package was released, and there is talk of Enhancement Package 6 going into ramp up in December 2011″

Our Analysis

This is all true.

Majority of ERP6 Upgrades Were Purely Technical

It is widely acknowledged that the majority of Upgrades to ERP6 were purely technical – so no new functionality was activated or considered as part of the upgrade activity. This was to reduce the cost of the Upgrade and to reduce the stress and risk of an Upgraded solution to the business. At one stage I received figures of 90% of upgrades to ERP 6 were purely technical.

Our Analysis

This is all true.

ERP6 Is Better Than Previous Versions

“It is very clear, that the technology, functionality and usability of SAP ERP6 is a much better product than any of the previous versions.”

Our Analysis

This is all true.

Negatives with EHPs

“I believe there are two core negatives from the Enhancement Package journey. The first one is visibility. SAP has been religiously providing the documentation around the Enhancement Packages but the messages have not been received by Customers. I believe there have been around 1000 pieces of new functionality released within the Enhancement Packages which is commendable, however how does the Customer know which are the right ones for them?”

Our Analysis

This is all true.

EHP Living Up to Billing

From a personal point of view, Enhancement Packages have not lived up to their billing. I think SAP has done a poor job in promoting Enhancement Packages and the relevant functionality.

Our Analysis

This is all true.

The Effort to Install EHPs

“My real concern with Enhancement Packages focuses around the volume of effort required to install Enhancement Packages. It is clear once this has been done, ERP6 users have a wide variety of new functionality that is only a few clicks away from being activated.”

Our Analysis

This is all true.

In Memory Computing is New

“In-Memory computing is a new, and potentially revolutionary, idea. Increasing the speed of processing and reporting on data will not only improve current ways of working but will reduce future risks as companies produce more and more data.”

Our Analysis

No, untrue.

New Innovative Hardware

“Using new innovative hardware will enable customers to reduce costs and consolidate complex enterprise architecture.”

Our Analysis

It is difficult to see how SAP takes credit for upgrading hardware. HANA has been incredibly inefficient in addressing very large hardware specs.

HANA’s Competitors

“SAP’s competitors are also making signals that they plan to move in to In-Memory computing, following rather than leading SAP’s move which indicates the potential ‘game changing’ process.”

Our Analysis

It is true that Oracle and DB2 followed SAP into adding “in memory” to their DBs, but not true that this was a game changer. It was a response to SAP’s marketing.

HANA is the First True In-Memory DB

“SAP HANA is the first true In-Memory computing product produced by the large enterprise software suppliers.”

Our Analysis

True, but it did not stay that way for long. By the mid/end of 2014 both Oracle and IBM had “in memory” added to their DBs. What is misleading about this is that HANA did not have foundational database capabilities when this article was published.

Usability and Performance and Uptake of HANA

“The usability, performance and up take of SAP HANA, positions SAP as the market leader in this space.”

Our Analysis

SAP had a barely functional database at this point with very few go-lives. This is highly misleading.

In Memory DB Changes So Much

“In-Memory computing is similar (to the iPad) in that it can change the way companies organise their hardware to support their reporting and enterprise software. In-Memory computing will change the system landscapes of many companies, both large and small.”

Our Analysis

No, this never happened. Seven years after this was written this has aged badly. “in memory” DBs were a passing fad. There are “in memory” DBs that can be accessed at far lower cost and work far better than HANA. They are actually cheap. Redis is one example.

Apple and SAP are Similar in Innovation

“Both Apple and SAP are market leaders in their various industry sectors. Both are known for the quality of their products and solutions. Further to this, both are seen as innovative and pioneers regarding new products and technology. In the 1980’s the walkman was the name for the personal cassette player.”

Our Analysis

Apple is innovative, SAP is not. SAP is known for copying innovation not for innovating. None of HANA was innovative but was based upon acquisitions.

HANA Will be Synonymous with In-Memory Computing

“The walkman was Sony’s name for the product but as they introduced the product to the market, their name was linked to personal cassette players. In ten or twenty years time I believe the iPad will be synonymous to the tablet, and SAP HANA will be synonymous to In-Memory computing.”

Our Analysis

HANA is synonymous with in-memory computing, but this is because of marketing, not because of HANA’s actual performance.

Great and More Significant Benefits than IT Cost Savings

“With SAP Business Suite powered by SAP HANA, the benefits are not constrained to just IT costs, significant tangible business benefits can be achieved as well. I personally believe that these will be greater and more significant than the IT cost savings and will be the basis of migrations and implementations.”

Our Analysis

SOH was a terrible waste of money for customers. This is what happens when a person with a quota to sell SAP services makes a prediction of the benefit of a new expenditure.

Can SOH Assist and Achieve in Objectives

“Most organisations will have strategic objectives and medium term goals. Can SAP Business Suite powered by SAP HANA assist to achieve those goals and objectives? If the answer is yes then any project will become more attractive to the CEO.”

Our Analysis

This is a moronic paragraph. It is not answering any question.

SAP ERP as System of Record

“The standard business suite from SAP is seen as the system of record.”

Our Analysis

True, but it isn’t. How can ERP be a system of record for fields that are originated in other applications?

Real Time Analytics

“By running SAP Business Suite powered by SAP HANA the real time analytics will ensure better decisions are made, which in turn will provide the ability to increase profitability and reduce costs.”

Our Analysis

There is no evidence that real-time analytics improve decision making. Secondly, there are no analytical capabilities within ECC outside of viewing tables. How does HANA improve this analytical functionality of ECC?

Leaders and Innovators Adopt New Functionality

“Leaders and innovators will tend to adopt new functionality and technology earlier compared to more conservative organisations that follow as they are more risk adverse.”

Our Analysis

Oh is that what leaders do? Interesting, because 100% of the S/4HANA implementations in 2013 failed. Do leaders implement software that is so immature it can’t be implemented? As for SOH, it added no value for its expense. Does this observation have anything to do with Mark Chalfen’s quota?

Promoting Challenge Internally Prior to SOH

“Preparation is key to success, and I would recommend promoting challenge internally just before looking at implementing SAP Business Suite powered by SAP HANA.”

Our Analysis

Mark misses the forest for the trees with this comment. SOH was an entirely pointless implementation that had to do with putting money into SAP and SAP consulting firm’s pockets. This is what Mark is trying to do, to promote implementations because this is how he and Bluefin Solutions make money.

SOH Becoming R/4

“Over the past few years many had speculated that SAP Business Suite on HANA would become R/4, however Jim Snabe made it very clear that this was simply just a new Enhancement Package for current SAP Business Suite clients.”

Our Analysis

This is true.

SOH Success Stories

“I would expect within 6 months we will start to hear about how customers benefit from SAP Business Suite on HANA. I would also expect over the next 18 months to 2 years that the adoption will slowly pick up as the use cases become more powerful and compelling with the more reserved clients realising that they MUST move to SAP Business Suite on HANA.”

Our Analysis

This did not happen. Mark Chalfen really should get out of the prediction business.

S/4HANA Uptake

“SAP S/4HANA has been around for just under two years. Over 150 customers are using the tool in a productive manner and there are a number of other productive projects in flight in addition to Proof of Concepts. I would expect this to increase to over 500 live customers by the end of 2016.”

Our Analysis

We dispute these numbers. But secondly, can this possibly be what SAP intended? 150 customers “using S/4HANA” productively? Does that mean live?

Simplification of S/4HANA

“SAP S/4HANA Enterprise Management is approximately six months old. This has a similar functional scope to SAP S/4HANA Finance, however the solution has been significantly simplified and further functionality has been added. Furthermore, a number of modules that were available in core SAP ECC are no longer available due to the ‘principle of one’.””

Our Analysis

If simplification means functionality removed, then we agree. This entire paragraph is misleading.

The Maturity of S/4HANA Finance

“The SAP S/4HANA Finance version is a mature product, based upon the number of productive customers utilising it and the duration it has been around. SAP S/4HANA Enterprise Management is approaching maturity. Since its release in November 2015, there has been one Feature Pack Support released in February 2016 with another due in May 2016. These packs contain fixes to the solution that was delivered and add small chunks of new functionality.”

Our Analysis

False. In 2016 S/4HANA could not be implemented. This is some wordsmithing in the extreme. “Approaching maturity” means it is immature. Why won’t Mark simply say it is immature? (that is easy, Mark makes his money in part by promoting S/4HANA, so may as well work for SAP sales)

SAP in the Cloud

“Given the number of releases scheduled, any organization looking at an SAP S/4HANA Enterprise Management implementation with a go-live date of 2017 can feel comfortable in the knowledge that it will be moving to a more mature and well-supported product. SAP supports the first tranche of customers via the Customer Care program and RIG Program – Regional Implementation Group. It provides a free service for a small group of customers to ensure they have the latest product information.”

Our Analysis

This is a strange statement. One does not “feel comfortable” with the knowledge that an application will become “more mature.” One feels comfortable when one is implementing an application that is complete. I should not have to explain this, but if an application is not completed, it normally is not implemented.

Large ECC Expenses Further Increase with S/4HANA

“There are currently less than 300 SAP S/4HANA Fiori apps. I would expect this figure to double within a year, so if you are expecting or looking for a pure SAP Fiori ERP system, S/4HANA is not ready just yet.”

Our Analysis

True. At this time Fiori apps have now grown to over 8,000 (but SAP got caught classifying Fiori coloured SAPGUI screens as Fiori). There are still very few people anywhere using Fiori. There would be more, but SAP made the decision to mostly restrict Fiori to HANA.

Statement Regarding S/4HANA Maturity

“Those customers I am talking to now who are considering SAP S/4HANA or working on a business case will find it to be a pretty mature solution come implementation. For those favouring a system conversion, looking at the solution as it is today, the jump is achievable. However, the further the product grows and matures, the bigger that jump will become and new installations will become even more popular.”

Our Analysis

This entire paragraph can be translated into trying to cover up how immature S/4HANA was at this time. In 2019, S/4HANA is still very rarely found live at SAP customers.

Conclusion

On average, for the statements measured, Chalfen had a 32.72% accuracy to his statements around S/4HANA, HANA and SOH.

SAP’s Inaccurate Messaging on S/4HANA as Communicated in SAP Videos

Fact-Checking SAP Information on S/4HANA

This video is filled with extensive falsehoods. We will address them in the sequence they are stated in this video.

SAP Video Accuracy Mesurement

Appleby's StatementAccuracy % of the CommentExplanationLink to Analysis Article
S/4HANA is what allows key processes to be digitized.
0%
ECC was already fully digitized and digitized across key business functions.The Problem with Using the Term Digital Transformation on IT Projects
HANA is a Platform
0%
HANA is not a platform, it is a database.How to Deflect You Were Wrong About HANA
Fiori is a major advantage for S/4HANA.
10%
In S/4HANA implementations Fiori is infrequently used when S/4HANA. How Accurate Was SAP on the Number of Fiori Apps?
Fiori is far more efficient than what came before.
10%
In testing Fiori and S/4HANA, Sven Deneken's statements did not hold up. There was a particular weakness in actually making changes after noticing something needed to be changed, and we found the efficiency below that of ECC with of course SAPGUI.
S/4HANA is innovative as it brings "real time inventory."
0%
Sven Deneken brings up the topic of "real-time capabilities," however there is nothing particularly real-time or different in terms of a reaction than ECC. Whenever you make a change in ECC or any other ERP systems for that matter, the entry is real-time. Sven Deneken states that "the physical inventory is the same as the digital inventory." However, under what system would this not be true?What Happened to the Term Perpetual Inventory?
S/4HANA is innovative because it allows access to supplier information.
0%
Sven Deneken states that information about the supplier is "just a fingertip away." Sven Deneken may be familiar with ECC, where supplier data is also a fingertip, or say mouse click away. It called the Vendor Master in ECC.
Sven Deneken says that the cycle could be changed to daily or sub-daily.
0%
Why would that occur? This is a very strange scenario that is being laid out.
S/4HANA is innovative because it allows MRP to be rerun interactively for a product location.
0%
Sven Deneken is extremely confused when he states that S/4HANA allows a fresh MRP run to be performed for a specific product location and that this is a differentiator for S/4HANA. For a single product location, there is no ERP system that cannot run MRP for a single location. Secondly re-running MRP does not remove uncertainties. MRP can be re-run when something changes. For example, when the forecast changes.Performance Problems with HANA and MRP
Sven Deneken states this demo shows SAP has reimagined inventory management.
0%
However, all of this functionality, save for several of the graphics shown in the video have already been available in ECC for many years, in fact, decades.

The Problem: A Lack of Fact-Checking of S/4HANA

There are two fundamental problems around S/4HANA. The first is the exaggeration of S/4HANA, which means that companies that purchased S/4HANA end up getting far less than they were promised. The second is that the SAP consulting companies simply repeat whatever SAP says. This means that on virtually all accounts there is no independent entity that can contradict statements by SAP. This analysis of information provided to the market by an employee of PwC with no other intent to provide this information than to sell business, and under false pretenses that involve repeating false information from SAP.

Being Part of the Solution: What to Do About S/4HANA

We can provide feedback from multiple HANA accounts that provide realistic information around S/4HANA — and this reduces the dependence on biased entities like SAP and all of the large SAP consulting firms that parrot what SAP says. We offer fact-checking services that are entirely research-based and that can stop inaccurate information dead in its tracks. SAP and the consulting firms rely on providing information without any fact-checking entity to contradict the information they provide. This is how companies end up paying for a database which is exorbitantly priced, exorbitantly expensive to implement and exorbitantly expensive to maintain. When SAP or their consulting firm are asked to explain these discrepancies, we have found that they further lie to the customer/client and often turn the issue around on the account, as we covered in the article How SAP Will Gaslight You When Their Software Does Not Work as Promised.

If you need independent advice and fact-checking that is outside of the SAP and SAP consulting system, reach out to us with the form below or with the messenger to the bottom right of the page.

Financial Disclosure

Financial Bias Disclosure

Neither this article nor any other article on the Brightwork website is paid for by a software vendor, including Oracle, SAP or their competitors. As part of our commitment to publishing independent, unbiased research; no paid media placements, commissions or incentives of any nature are allowed.

S/4HANA Implementation Research

We offer the most accurate and detailed research into S/4HANA and its implementation history. It is information not available anywhere else and is critical correctly interpreting S/4HANA, as well as moderating against massive amounts of inaccurate information pushed by SAP and their financially biased consulting ecosystem.

Select the description that best matches you.

Option #1: Do You Work in Sales for a Vendor?

See this link for an explanation to sales teams.

Option #2: Do You Work for an Investment Entity that Covers SAP?

See this link for an explanation for investment entities. 

Option #3: Are You a Buyer Evaluating S/4HANA?

For companies evaluating S/4HANA for purchase. See this link for an explanation to software buyers

Search Our Other Who Was Right and Wrong on HANA Content

References

TCO Book

 

TCO3

Enterprise Software TCO: Calculating and Using Total Cost of Ownership for Decision Making

Getting to the Detail of TCO

One aspect of making a software purchasing decision is to compare the Total Cost of Ownership, or TCO, of the applications under consideration: what will the software cost you over its lifespan? But most companies don’t understand what dollar amounts to include in the TCO analysis or where to source these figures, or, if using TCO studies produced by consulting and IT analyst firms, how the TCO amounts were calculated and how to compare TCO across applications.

The Mechanics of TCO

Not only will this book help you appreciate the mechanics of TCO, but you will also gain insight as to the importance of TCO and understand how to strip away the biases and outside influences to make a real TCO comparison between applications.
By reading this book you will:
  • Understand why you need to look at TCO and not just ROI when making your purchasing decision.
  • Discover how an application, which at first glance may seem inexpensive when compared to its competition, could end up being more costly in the long run.
  • Gain an in-depth understanding of the cost, categories to include in an accurate and complete TCO analysis.
  • Learn why ERP systems are not a significant investment, based on their TCO.
  • Find out how to recognize and avoid superficial, incomplete or incorrect TCO analyses that could negatively impact your software purchase decision.
  • Appreciate the importance and cost-effectiveness of a TCO audit.
  • Learn how SCM Focus can provide you with unbiased and well-researched TCO analyses to assist you in your software selection.
Chapters
  • Chapter 1:  Introduction
  • Chapter 2:  The Basics of TCO
  • Chapter 3:  The State of Enterprise TCO
  • Chapter 4:  ERP: The Multi-Billion Dollar TCO Analysis Failure
  • Chapter 5:  The TCO Method Used by Software Decisions
  • Chapter 6:  Using TCO for Better Decision Making