The right approach to S/4HANA #9: The epic battle Greenfield versus Brownfield

History is full of epic conflicts of antagonists whose clash is never-ending and whose followers are divided by almost religious feelings. Ali vs. Frazier. City vs. United. The three Beatles versus Lennon and Yoko Ono. Springfield vs. Shelbyville. Batman vs. Superman. Alien vs. Predator.

Since the 2010s we have another epic battle between two philosophies, in which the discourse is sometimes not much more rational than the question if the preferable hero should wear a red cape or a black mask: Greenfield versus Brownfield.

Very often you get the feeling that one of those two transition methods mean salvation while the other means doom and eternal agony. But which is what depends of course on who you ask. And when you bring Pros for the disfavored method, you very often are on the brink of getting waterboarded with holy water.

Famous Painting "Man forced to do a transition method he does not approve" - Edvard Munch, Oil on Canvas, 1893 - National Gallery Oslo

My examples are ridiculous, exaggerated and irrational? Sure. But not very different from how these discussions are often led.

So let’s bring common sense back into this topic and put all the Pros and Cons together. To achieve this, lets start with a (very!!) basic explanation of those to transition methods.

Greenfield

Greenfield is the classic way to start basically with a white sheet of paper (or on a “green field”) and design all the processes that are needed for the aspired system. In a way you ask yourself “What do I need” and “How do I want to work?” and design all necessary elements to achieve exactly this goal. Or rephrased: You start with the process definition first THEN do the technical stuff.

Brownfield

Brownfield (or System Conversion) is in a certain way the exact opposite: You take what you process-wise already have and put that onto a new technological platform, THEN you do the process optimization stuff. Sounds fast and easy.

What are common clichés and misconceptions concerning these approaches?

- A Greenfield takes a lot of time and is expensive

- A Brownfield is much faster and cheaper

- A Brownfield is an innovation blocker, because brown means you take over a lot of old s… from the legacy system

- Only a Greenfield enables you to achieve excellence

- Risk? Nope, that’s why I take a Brownfield

Well, surprisingly all of these statements are not really true, because most of them derive from an age where implementation automation and tools were by far not as advanced as they are today, and that’s why discussions about these options get quite fast very pseudo-technical and dominated by half-knowledge, nervousness and irrationality.

Let’s clear up the sky and approach this topic from a different direction. Strategy? Again? Yes because this is all what is it about.

Take a look for example at this picture:

This picture puts it down really clearly. Yes, the business values grow naturally the more you free your mind, grab a white sheet of paper. If you take a look at the capabilities of S/4HANA without being too limited of the thoughts about the old processes, this is the best basis to bring all the horsepower to the street. You may object that a brownfield approach still can bring similar benefits even when the process optimization happens after the technical conversion.

This is theoretically correct, BUT in my opinion, there is the risk of projects running out of steam after the conversion is done. If you did not set your project on a clear innovation path you may lose the support of some people from the business department because you “already had your project”. To avoid that risk, follow the best practices in the volumes #1-#7 of my blog and you are safe.

But on the other hand I want to quote a befriended CIO of mine who said: “I realize we are given now the chance we get once in 20 years to set things right, reduce the number of our systems and streamline our processes and organizations to the challenges and chances of the 21st century.”

“I realize we are given now the chance we get once in 20 years to set things right, reduce the number of our systems and streamline our processes and organizations to the challenges and chances of the 21st century.”- CIO of a DAX company

And I absolutely agree with him. When you see S/4HANA and the Digital Core from this perspective and not merely as an IT conversion you will see that your digitalization initiative becomes strategic. Spends become investments, S/4HANA is not a cost case anymore but a strategic enabler. And this brings not only much more transparence concerning your individual value proposition, but it makes the implementation much more efficient because certain questions become clear. And in this aspect you can not beat the Greenfield approach.

Furthermore, conversion prerequisites must be met, and if you are running an old ECC Release, are not on Unicode and are heavily modified a Conversion or Brownfield project is suddenly not so quickly done anymore and that’s where Greenfield projects can easily outpace you: If you start with the Best Practice Content of the Model Company, a process library that is delivered with S/4HANA, and you set your check marks there on all commodity processes so you can concentrate on the clean definition of your individual differentiation processes, you gain a lot of speed and momentum. And from a cost and speed perspective, you are not far behind of a brownfield and in many cases ahead of it concerning your enterprise value release.

So leave all the ideological thinking behind and start your implementation journey with five easy questions that help to set your project in the right direction:

- Do I need to keep my solution enhancements or my transaction data history?

-         Does my system fulfill all conversion prerequisites?

-         Do I need a phased business roll-out?

-         Do I need a renewal of my complete ERP solution?

-         How do I perceive my current system? Innovation Blocker or Key Asset?

If you ask yourself these questions you bring this discussion already on a rational basis so that the outcome is right, no matter if the result will be a System Conversion/ Brownfield, or a Greenfield.

And you will find your fitting transition method, that brings you maximum benefit at the lowest possible effort.

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