Clean Core Value Proposition

What is Clean Core?

The clean core concept is a mindset and philosophy supported with governance and guiding principles that lay the foundation for a flexible and future ready ERP.It describes modern approaches to design business processes, extensions,integration scenarios and data architectures in a stable, upgrade safe and transparent manner, along with a separate platform to innovate for additional differentiation.

A clean core allows faster software deployment as well as easier adoption ofboth SAP innovations and the regulatory changes to software.It provides new ways to address business needs while avoiding excesstechnical debt, thus preparing organizations to maximize strategic benefits andlimit the cost of transformation.

Beneifts of Clean Core?

A clean core allows to adapt the system to changing business requirements and to adopt new capabilities while ensuring permanent traceability in all areas of the core. It provides…

…agility and flexibility.

Clean environments decrease time to value. Additional process requirements can be implemented faster and business models can adapt to short term challenges more easily.

…leverage latest innovations i.e. to stay current.

Adaptation effort in the context of updates and upgrades is reduced. Cloud services can be integrated faster.

…efficient and secure operations.

E.g. no costly maintenance for unused artefacts

…data to value

Consistent data allows reliable forecasts and precise predictions

Overall, clean core reduces historically grown process complexity through targeted technical modernization, aligned with a business transformation.

Clean Core Value Proposition

At the heart of Clean Core is the ability to isolate customizations from the core ERP system. This minimizes the disruption caused by future upgrades and reduces the complexity of maintaining the system. Instead of locking into monolithic ERP systems with heavy custom code, customers can move to a composable ERP approach that supports flexibility and scalability.

This strategy becomes a launchpad for businesses to innovate more rapidly, leveraging modular components, extensions, and integrations. With Clean Core, businesses are empowered to:

• Accelerate their digital transformation journey with SAP S/4HANA.
• Gain greater efficiencies by modularizing the ERP system, which improves overall system performance and adaptability.
• Leverage innovations without worrying about the complications of technical debt from past customizations.

Embracing a Composable ERP Approach

In an era where businesses are continuously pressured to adapt, embracing a composable ERP approach ensures that companies remain agile. The Clean Core strategy simplifies the ERP system by decoupling custom extensions and innovations from the core, allowing organizations to innovate in the cloud while keeping the core clean and upgradable.

Modular ERP enables businesses to break down their IT infrastructure into smaller, reusable components that can be easily reconfigured to support changing business needs. This ensures that as market demands evolve, the organization can adapt without complex, time-consuming IT overhauls.

Opening New Revenue Streams & Business Models

The move towards Clean Core developments is not just about efficiency and cost management; it also opens doors for businesses to explore new revenue streams. One of the key benefits is the ability to package custom developments into micro-applications. These micro-apps can then be reused, scaled, and even re-sold to other organizations, creating additional revenue sources.

This new way of developing micro-applications allows businesses to recognize the intellectual property (IP) created as assets on their financial statements, transforming IT from a cost center to a revenue-generating department.

Building IT Resiliency for the Future

Building IT resiliency is critical for organizations aiming to navigate the shifting economic landscape. Clean Core principles enable IT departments to respond faster to business changes, reduce the risk associated with large-scale transformations, and ensure the sustainability of IT investments.

As industries move towards automation, AI, and cloud development, retaining and sourcing the best talent becomes crucial. A Clean Core strategy helps organizations stay competitive by enabling IT teams to:

• Focus on innovation rather than system maintenance.
• Attract top-tier talent who are excited to work on cutting-edge, modular IT solutions.
• Cross-train existing staff, ensuring they are empowered to work on modern, agile systems.

This shift not only strengthens IT but also aligns the technology department with overall business goals, positioning the organization as a leader in innovation and adaptability.

Reducing Technical Debt

Historically, large-scale ERP upgrades have been costly and time-consuming, primarily due to the accumulation of technical debt. This technical debt stems from heavy customizations embedded into the ERP core, making it difficult to perform necessary upgrades or implement new features without risking system stability.

By adopting Clean Core principles, businesses can revisit their technical debt, reduce complexity, and achieve significant cost savings in the long term. This approach enables:

• Shorter upgrade cycles and faster implementation of new functionalities.
• Reduced reliance on highly specialized resources for maintaining outdated customizations.
• More predictable IT costs by eliminating the need for extensive custom code updates with each new version of SAP S/4HANA.

Agility in the Face of Economic Change

To remain competitive in today's dynamic markets, organizations need the ability to respond quickly to shifting economic factors. Whether it’s adapting internal processes, restructuring financial operations, or building new business models, agility is key.

A Clean Core approach allows organizations to modularize their SAP S/4HANA system with ease, supporting rapid changes in business strategies. Companies can integrate new capabilities without needing to rework the core system, enabling swift responses to market shifts and accelerating time to value.

Why Clean Core is the Best Path Forward

For customers looking to future-proof their digital transformation, Clean Core is more than just a strategy—it's a way to unlock new opportunities. By embracing this approach, businesses can:

• Achieve greater flexibility and respond quickly to changes in the market.
• Reduce costs by eliminating technical debt and simplifying IT infrastructure.
• Create new revenue streams by packaging custom developments into micro-apps.
• Strengthen IT resiliency and attract top talent by focusing on innovation rather than maintenance.