SAP S/4HANA migration: The automotive industry in transition

All transformation projects share one thing: they are complex, time-consuming, and costly. This is why flawless execution — from planning through successive test cycles to go-live — is pivotal for success.

Continuous change demands clear direction

In 2025, the automotive industry is undergoing a profound transformation shaped by technological innovation and sustainability goals. Powertrain technologies, environmental regulations, autonomous driving, and integrated mobility concepts are evolving faster. Automakers are increasingly relying on software integrations and digital services. These conditions intensify competition while driving shifts in product and model portfolios. The entire industry is in the midst of transformation.

In parallel, companies must migrate their SAP systems to S/4HANA (or alternative platforms) by the end of 2027. These twin demands bring new complexity and require strategic decisions to maintain market competitiveness.

The necessary migration efforts introduce multi-faceted challenges across many business units. At Natuvion, we draw on deep expertise in data migration and in meeting these challenges. We offer insights into lessons learned, obstacles, project accelerators, and a holistic approach that aims for minimal downtime of critical systems.

The path to a successful future

Automotive companies typically run a variety of systems that must be integrated. When version gaps or end-of-life incidences arise, integration across those systems becomes impossible. Migration to S/4HANA or other SAP solutions can be especially difficult under such constraints. Common challenges include retiring SAP WM in favor of EWM and sunsetting SAP SRM — complications that are often made worse by concurrent development of corporate templates. For instance, a mandate might require FI to be integrated into a group-wide system, while logistics modules are migrated in a standalone manner to S/4HANA.

Many transformation successes confirm that complexity can be mitigated early through careful planning. The table above illustrates how certain actions influence project outcomes.

Further, the Natuvion solution DCS Migrate supports transformation challenges. Its mapping templates for R/3 to S/4HANA migration, standardized project methodology, and data quality reports are powerful project accelerators. Combined with expertise in carve‑outs, template approaches, module changes, New GL, asset accounting, and more, Natuvion and its products help ensure a holistic transformation vision.

Optimal preparation minimizes project risks

As the saying goes, "Well begun is half done". We assist clients with a pre‑project phase to validate or build the program and project plans. Here we bring in DCS Analyze, our data analysis tool. It generates an automotive‑specific Power BI dashboard that gives a clear view of the existing environment and forms a strong basis for the target state in S/4HANA. Together with the SAP S/4HANA Readiness Check, this stage helps identify necessary subprojects, dependencies, and decisions required in the high‑level planning phase. Template approaches are often applied, especially in extensive, complex environments in the automotive sector. Early scoping enables companies to assess which templates are feasible and the likely financial requirement for roll‑out.

Laying the foundation for transformation

In addition to planning the overall endeavor, solid preparation is the cornerstone of transformation. Whenever project conditions allow, we recommend executing certain topics as preliminary workstreams to reduce risk downstream.

SAP General Ledger

Implementing the new SAP General Ledger (New GL) requires a structured approach. Companies often need to revisit existing processes, define new ledgers, and use the new capabilities appropriately. Because of its complexity, this step is well suited as a preliminary project. Timing is crucial — a mid‑year migration, for instance, can threaten financial data integrity, increase integration complexity, or complicate closing processes. Corporations need to transition from the old distinction between general ledger accounts and other accounts. In automotive, the need to model complex supply chains, many product variants, global operations, and regulatory requirements adds further complexity. Document splitting should be configured properly to maintain transparency and accuracy. While advantages like real‑time analytics and simplified reporting are compelling, the migration is less an option than a necessity for S/4HANA transformations.

SAP Business Partner – Key Considerations

Introducing SAP Business Partner consolidates business partner types and manages their interrelationships. In the automotive industry, OEMs coordinate with many partners — suppliers, dealers, service providers, marketing agencies and more. The goal is to achieve a unified data structure without losing process flexibility. Companies must also take integrations with CRM and supply chain systems into account. Critical decisions include identifying which account groups convert to Business Partner, selecting roles (customer, supplier, contact, sales, logistics, tax, etc.), and handling custom roles (e.g. dealers). The switch to Business Partner may be carried out as a preliminary project or integrated as part of the transformation using DCS Migrate, connecting legacy ECC customer/vendor data to the Business Partner model in S/4HANA.

What about SAP SRM in e‑procurement?

All good things must come to an end. This saying is especially true for SAP’s respected E‑Procurement solution. SAP has announced that SRM’s lifecycle will end in 2027. SRM, first launched over 25 years ago, has been a mainstay in procurement. But SAP’s 2012 acquisition of Ariba sealed the strategic direction: to encourage customers to migrate to newer solutions. Many companies delayed this migration because their SRM systems had been heavily customized and still worked well. But now the question isn’t "why" switch — it’s "when".

As competitors’ solutions have caught up and focused on smooth integration with SAP ecosystems, customers have more choice and better return on investment options. At Natuvion, we often join projects after the customer has already selected the new solution and taken key decisions. While we understand this, we advise early data transformation planning because it impacts success. Our DCS Analyze 360° SRM analysis provides highly granular insights to reduce implementation risk and smooth the transition — like knowing before moving house that the couch won’t fit in the new living room.

Success factors

Based on deep experience in the automotive industry, we know many companies have built complex, customized SAP SRM landscapes. The following points are crucial for project success:

• Ensure complete understanding of legacy processes (business and technical) — essential during both selection and implementation
• Learn from the past, optimize for the future — revalidate custom enhancements and apply insights in the new system
• Migrate only essential data — overloading the new system can harm performance and user adoption
  
  

Modern strategies in warehouse management

The future of warehouse operations: SAP systems in flux

Warehouse management is in the midst of profound transformation, similar to how the automotive industry is evolving due to technology and sustainability. Companies now seek agile, efficient solutions that optimize their processes and strengthen competitiveness. At the heart of this shift lies the modernization of SAP-based warehouse systems.

The end of an era: LE-WM and the S/4HANA shift

Many organizations have relied on SAP’s LE-WM module for decades. But as support winds down and SAP commits to S/4HANA, firms must decide by 2027 to either migrate to S/4HANA or consider alternative providers. LE-WM, once dependable, no longer meets the adaptability modern warehouse operations demand.

Stock Room Management: a transitional option

SAP introduced Stock Room Management in S/4HANA as an interim solution for companies with simpler warehousing needs. It enables a gradual transition away from LE-WM, without fully embracing Extended Warehouse Management (EWM). But it has limitations:

1. Basic features only: lacks advanced automation, yard or labor management
2. Limited scalability: custom or complex operations will quickly push the product to its limits
3. Long-term uncertainty: if SAP focuses on EWM long-term, additional migration may be required

SAP Extended Warehouse Management (EWM): the modern standard

SAP recommends EWM as the future-proof warehouse solution. With extensive features for advanced process control, automation, real-time monitoring, and complex structures, it is well suited for modern logistics.

Two variants exist:

• EWM Basic – included in the S/4HANA license, suitable for simpler requirements
• EWM Advanced – premium option, supports yard, labor, cross-docking, etc.

Benefits include operational efficiency, cost reduction, and improved customer service via faster, more precise deliveries.

Challenges and recommendations

Migration to EWM is no small undertaking. Meticulous planning, testing, and change management are essential to ensure process alignment. That’s where transformation partners like Natuvion offer value — by helping define realistic plans, build test strategies, and coach employees.

Conclusion: a strategic leap forward

While migrating to EWM is complex, the payoff is significant: revamped warehouse operations, lower cost, and stronger competitiveness. With careful planning and support, EWM implementation can be part of a critical move into a digital, sustainable future. Companies that begin now will be best positioned for tomorrow’s demands.

Minimal downtime, maximum efficiency

In logistics, manufacturing, and procurement systems, every minute matters. Downtime directly impacts cost and operations. Near-Zero Downtime (NZDT) strategies maximize system availability during transformation, minimizing impact on critical business activities (e.g. around-the-clock production). The target metrics are tailored to each customer and environment.