Fujitsu sets out on 5-year mission to standardize ERP on SAP S/4HANA

To that we say good luck

Fujitsu, the global tech services biz, is embarking on an ERP standardization program to use one system worldwide, based on SAP S/4HANA, in a project expected to employ around 1,500 people at its peak.

The five-year plan is designed to help Fujitsu, which employs around 124,200 people, become a digital transformation company in a repositioning costing around $760 million.

EVP and chief data and process officer Shunsuke Baba, who is leading the OneERP+ project, told The Register that CEO Takahito Tokita, who took his post in 2019, set the direction.

"The program was started in the second half of 2020 in order to build a foundation to support the purpose-driven and data-driven management, which represents a core measure in this strategic shift. There are many different business processes and systems for each business and region. One of our key challenges is how to thoroughly standardize all business process data and simplify it as a basic system," he said.

The scale of the task is eye-watering. Fujitsu currently runs more than 4,000 systems supporting internal business. For ERP, they include multiple instances of SAP-based systems and a number developed in-house.

"Our goal with the initiative is to organize and integrate them all at once to standardize and streamline operations in a holistic manner," Baba told us.

The plan is to move all its ERP systems to a single S/4HANA platform, hosted in Microsoft Azure. Meanwhile a number of SaaS front-end applications will also run in Azure with other elements hosted by AWS.

The org needs to manage sales, accounting, procurement and project management data, among other moving parts.

Global businesses have struggled to rationalize onto a single ERP system, owing to the complexity of the migration during these long and difficult projects. The danger is that it can take so long to understand business processes and implement new ones that by the end of the project, the nature of the business has changed.

But Baba said Fujitsu planned to provide an example of success in digital transformation – the holy grail of joined-up and aligned systems from front to back end – to its customers.

"Through our own practices, we believe that we have a mission to provide customers with reference models of practical knowledge, including things that went wrong in our own implementations. As the 'first penguin' to take the plunge, we will continue to demonstrate positive models, leading the way for our customers to help them to successfully embark on their own DX [digital transformation] Journeys," he said.

As part of the huge project, Fujitsu is planning on adapting its wide variety of business processes that exist around the globe to a standard set implemented in S/4HANA.

"This is a very challenging project, and although it is actually promoted with the inclusion of add-on development, it is not merely an ERP introduction project, but is also promoted as a large-scale reform project at the management level on the premise of a large-scale transformation of business processes. The organization consists of a team that designs business transformation from a business perspective and a team that implements it as an IT system," Baba said.

The ERP integration project, called OneERP+, is expected to last five years. SAP Concur and other services have been in operation since fiscal 2022, and the ERP system is targeted at HQ employees as the first phase. It is aiming for operation within fiscal 2024.

"The key success factor will be how to plan and execute the optimum transition plan by balancing the reform needed for the current business execution and the reform of the business process needed for promoting OneERP+," Baba said.

Research from Gartner has shown that SAP customers appear reluctant to move from earlier iterations to the latest S/4HANA platform, while also seeming reluctant to move to the cloud. Whether customers take the plunge with Fujitsu remains to be seen. It is, nonetheless, bound to make a splash. ®