ERP systems are at the heart of almost every midsize and large business, and I know from personal experience that ERP downtime can hurt business and even the stock price.
Syngenta is a company that has hosted its mission-critical applications in “high-cost traditional data centers” and transformed them into what it believes to be a reliable, future-proof and scalable environment in the cloud.
Syngenta is one of the world’s largest producers of seeds and crop protection solutions with a presence in more than 90 countries and headquarters in Basel, Switzerland. I recently spoke to Christian Bayer, Global Head of ERP/SAP and Data and Analytics at Syngenta, and partner Infosys about moving SAP to the public cloud.
A cloud-first strategy
Syngenta has made the strategic decision to pursue a cloud-first IT strategy. As a result, Syngenta decided to end a long-standing data center hosting partnership and move everything possible to the cloud.
The most significant and risky part of this migration to Amazon Web Services (AWS) was the ERP platform with over 50 SAP systems, including four core ERP systems and several SAP peripheral systems, which form the central IT backbone for Syngenta’s business form.
There were several serious failures of the central ERP systems before Christian Bayer became responsible. Part of the reason was outdated technology with a track record that hasn’t kept up with hardware upgrades. Second, hosting in its shared data center environment involved shared components that were complex and difficult for the vendor to manage.
Christian Bayer’s cloud-first strategy was to get to a place where he had enough control to “guarantee it (ERP) will be as reliable as water out of the faucet.” That’s a really big goal.
There were other benefits for Sygenta moving to the cloud. First, it had more flexibility and scalability to support the seasonal farming business. Syngenta has fewer than six months of the year, which accounts for 80% of sales, depending on the hemisphere. With the previous hosting model, the servers sometimes ran idle during the slow season of the year. The flexibility Syngenta could draw from the cloud is attractive for a seasonal business.
In addition, Syngenta can benefit from the technology of a cloud provider when migrating from existing SAP systems to S/4HANA.
Last but not least, cost savings were expected. SAP’s move to cloud-enabled infrastructure resulted in cost savings of 28% per year, with ROI achieved in a year and a half. These are impressive savings that essentially come with a “lift and shift” with some modernizations and version upgrades. I was surprised at the notion of saving money in the cloud as this rarely reflects reality but made sense given the on-premises infrastructure had to accommodate this 80% increase throughout the year.
The biggest advantage comes from the flexibility in the cloud. The speed with which a new test system can be created allows Syngenta to provide only one three-tier SAP landscape for development, quality assurance and production and to set up additional test systems if required.
Multi-cloud spreads the risk
Like many companies I speak to, Syngenta runs workloads on both AWS and Microsoft Azure. Azure is used for commercial applications simply because most are based on Microsoft technology. AWS hosts ERP, all R&D, and the data lake.
With an understanding of fully managed cloud infrastructure comes reduced risk. Not entirely harmless, as a failure caused by overheating in the Frankfurt region shows.
But designing and designing the best practices for managed cloud infrastructures with AWS offers future improvement opportunities such as the establishment of multiple regions, additional layers of security, and improved connections with the network architecture. With a highly available ERP environment, the focus is now on the network architecture, site and cloud data center connections and the network hub. The overall network architecture is equally crucial to ensure a resilient IT infrastructure.
AWS Migration – Old World to New World
The project lasted a year and a half, migrating over 50 applications and over 600 TB of business data to the cloud. Some of the systems had to be upgraded to the latest versions and some were retired (e.g. BW BI Accelerator) that were not cloud compatible. Other applications have either required discussions with SAP to enable support on AWS (e.g. Business Objects Financial Consolidation (SBFC)) or are in the process of being migrated to cloud-backed versions such as Master Data Management (MDM to MDG).
Establishing connectivity with over 300 third-party providers from the cloud data center was a significant effort that involved migrating FTP servers and VPN tunnels.
Smooth operation during the transition phase and modernization of the integration layer with over 1,500 interfaces was a crucial phase of the project. Syngenta said Infosys handled this seamlessly.
The SAP PO environment was modernized and updated to the latest version (7.5) and then migrated to AWS using infosys. This first step was performed in three phases: 1) server upgrade and migration to AWS, 2) migration and validation of the outbound interfaces, and 3) migration and validation of the inbound interfaces. This phase was the foundation for the rest of the migration project, which took over a year but created a platform for success.
The Infosys relationship
Infosys has been a strategic SAP partner for Syngenta for more than 19 years.
The long-standing partnership has brought with it many large transformation projects. Christian mentioned that Infosys will “always do whatever it takes to get you across the finish line and never let you down” – that’s a strong endorsement.
Syngenta worked with Infosys to bring Agile DevOps to SAP support, the first company to roll out the capability at scale in SAP
Vibhuti Dubey, Senior Vice President and Head of SAP Services at Infosys, highlighted this “Our primary goal was to carry out this complex transformation risk-free. We have positioned our architects to support the project through wave planning, drawing on our extensive experience and leveraging Infosys Cobalt, a suite of services, solutions and platforms that act as a force multiplier for cloud-based enterprise transformation.”
The Syngenta and Infosys IT team performed system validation and testing to minimize the need for business involvement.
The Syngenta migration is an impressive story. I speak to many customers and only a few have saved money moving to the cloud. Syngenta operates in a highly seasonal business, so the ability to add or remove compute capacity at will without constraint translates into cost savings. Syngenta can ride the demand curves and doesn’t always pay for peak loads.
Syngenta can scale the infrastructure to support peak season but also reliability. Christian notes: “When was the last time Netflix, Amazon and Facebook went down? We should expect close to 100% uptime from a hardware perspective.” All sites go down, but not much.
Syngenta continues to modernize its platforms. Old systems are gradually being replaced by new technologies. The finance department was the first to move with a successful go-live of S/4 Hana Central Finance. Each business unit strives for a single global SAP instance. In cooperation with Infosys, the migration to S/4HANA has already started.
Disaster recovery scenarios and the ability to run platforms with near-zero downtime are now possible next goals. The goal is for ERP to run so that production lines never have to stand still anywhere in the world – as reliably as water from the tap.
Note: Moor Insights & Strategy writers and editors may have contributed to this article.
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