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Two-Tier ERP for SAP S/4HANA Cloud - A catalyst for Industry 4.Now

When a company implements different ERP systems for different parts of the organization, the industry calls this a Two-Tier ERP strategy. This strategy is driven by the realization that the needs of large, complex organizations are very different than the needs of smaller, simpler organizations. A smaller organization, typically a subsidiary, can be much more effective when it runs an ERP solution that fits its needs, and is not burdened by the overly complex solution needed by its larger sister organizations. As companies look to strengthen their Industry 4.0 strategy, they want more effective subsidiaries while still maintaining a high level of collaboration and coordination across the entire organization. Various Two-Tier deployment options shown below can support the customer in their journey towards Industry 4.0.

To understand how Two-Tier ERP complements Industry 4.0 , please take a look at the whitepaper Two-Tier ERP for SAP S/4HANA Cloud - The catalyst for Industry 4.0. This blog post summarizes the concepts from the whitepaper.

Two-Tier ERP for SAP S/4HANA Cloud as the key change driver for Industry 4.0

SAP S/4HANA Cloud is becoming the central change driver to help intelligent enterprises setup their connected digital core on the cloud. This opens great opportunities for mainstream businesses looking to harmonize their business processes and prepare for their journey into Industry 4.0.

Customers who currently have most of their manufacturing and operational processes on ECC or SAP S/4HANA on-premise are able to increase operational efficiencies, customer satisfaction and lower process costs due to automation of process steps by leveraging the capabilities of Two-Tier ERP to move them closer to their vision of Industry 4.0.

“Two-Tier ERP setup is vital for strategic goals and growth targets for organizations” -  IDC Manufacturing survey.

For customers who are looking for an upgrade path or want to explore offerings in the cloud, Two-Tier ERP offers an option where they get to keep their current ECC or SAP S/4HANA on-premise setup intact and deploy key functions and processes into the cloud. This gives them a big head start on their cloud journey and makes their potential move into the cloud more seamless.

This evolution is spearheaded by SAP’s Two-Tier ERP which puts many Industry 4.0 use cases in the grasp of companies and businesses today. Key use cases include:

  • End to end integration between the planning system and the execution system

  • Full visibility of predictive maintenance schedules with connected assets

  • Harmonized project control and tracking with SAP S/4HANA Cloud for projects

As we get comfortable talking about this change in paradigm and move closer to a truly connected, integrated and intelligent enterprise, we at SAP are ensuring our customers have the best processes and guidance to make this journey a smooth and successful one.

Leverage Accelerated Technological Advancements

Amid rapidly changing times and very demanding work environments, businesses are challenged to adapt faster than ever before and accelerate technological advancement in the areas of machine learning, IoT, predictive analytics and intelligent enterprises. There is a huge push to embrace change and innovate in these new areas.

By the End of 2021, 25% of Global Manufacturers Will Apply Machine Learning to Data Across Product Development, Supply Chain, Manufacturing, and Service for More Rapid Decision Support, Improved Quality, Differentiated Products, and Innovative Business Models. - IDC Manufacturing Insights for Innovation Acceleration

As consumers become aware of their role in driving change towards making enterprises more flexible and intelligent, manufacturers must think out of the box to find a good balance between consumer demands and production feasibility. A growing trend is that more customers are opting for customized orders rather than stock orders, making major manufacturing companies question the viability of traditional make to stock processes.

On the one hand the manufacturers want to offer the consumers as much flexibility as possible and on the other hand their need for optimized processes calls for harmonization and standardization. Manufacturers must now embrace this changing business trend and build an appetite for rapid change. The emergence of e-commerce has brought the consumer closer to manufacturers, which increases the importance of a mindset that is focused on change.

All this throws up an interesting yet challenging scenario that is now making discrete and process manufacturers look towards technology and innovation for help.

With the recent announcement of RISE with SAP, customers can now categorically start at hybrid ERP as being a major enabler towards their transformation to an intelligent enterprise. RISE with SAP is an on-your-terms and on-your-timeline transformation to an intelligent enterprise. It is a single offer that allows you to change when and how you get to where your business needs to go. It offers lower TCO, faster time to value, and the flexibility to address disruption without high upfront investment.  SAP S/4HANA Cloud is now a key  component of RISE with SAP.

For more details about Two-Tier ERP for Industry 4.0 powered by SAP S/4HANA, check the whitepaper:

Two-Tier ERP for SAP S/4HANA Cloud - The catalyst for Industry 4.0

Further References:

Hybrid Cloud ERP – an outlook for 2Tier ERP with SAP S/4HANA Cloud

Two-Tier ERP with SAP S/4HANA Cloud and deployment possibilities



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For more information on SAP S/4HANA Cloud, check out the following links:  

  • The power of best-in-class and Next Practices business content for a modern ERP Blog Post

  • SAP S/4HANA Cloud: The Intelligent ERP Link Collection Blog Post

  • Latest SAP S/4HANA Cloud Release Blogs here

  • SAP Intelligent Robotic Process Automation Content here

  • SAP S/4HANA Cloud release info: http://www.sap.com/s4-cloudrelease

  • SAP S/4HANA PSCC Digital Enablement Wheel here

  • Inside SAP S/4HANA Podcast here

  • SAP S/4HANA Cloud Community here

  • SAP Activate Community here

  • Best practices for SAP S/4HANA Cloud here

  • Help Portal Product Page here


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