Legacy SAP ECC to SAP S/4HANA Migration: Digital Modernization for a Baltic Heat Energy Provider

Discover how LeverX helped a Baltic heat energy provider modernize its enterprise landscape with SAP S/4HANA. The project delivered a seamless migration from SAP ECC, streamlined operations, improved analytics with SAP BW/4HANA, and enhanced user experience through SAP Fiori.

Client

AS "RĪGAS SILTUMS" is a leading Baltic heat energy provider supplying over 70% of the heat energy in Latvia. The company transfers and distributes 76% of the heat energy consumed in the city, managing an expanded heating network with a total length of 689 kilometers. 

The company generates over 30% of the total heat energy using its own facilities, relying on a combined energy portfolio that includes natural gas, wood chips, and other renewable resources. It is this existing reliance on fossil fuels that prompted the client to implement the long-term "Green Course" strategy, aimed at profound transformation. As part of this strategy, the company aims to produce 90% of its heat energy from renewable sources by 2030.

To successfully execute this massive transition and manage regulatory complexity, AS "RĪGAS SILTUMS" initiated a large-scale digital transformation project aimed at modernizing its existing core ERP with a modern platform for data-driven decision-making and sustainable growth.

Challenge

For many years, the client had relied on a deeply integrated SAP ECC system, which became the core of its operational activity. However, as operational and regulatory requirements evolved, several challenges began to hinder business efficiency and the realization of sustainability initiatives critically.

Legacy system limitations

• The deep integration of the legacy SAP ECC system into core business functions restricted modern automation capabilities.
• The existing SAP ECC system and reliance on manual workflows created significant inefficiency in daily operations and limited overall business agility.
• Reliance on manual and paper-based processes led to delays and reduced data accuracy and reliability.

Lack of real-time visibility

• Managers faced difficulties accessing up-to-date information across departments. 
• The absence of real-time analytics and unified data reporting slowed decision-making and reduced trust in system-generated insights.

User experience challenges

• Outdated system interfaces limited user adoption and productivity. 
• Employees lacked intuitive tools that could support efficient and compliant task execution.

Regulatory and sustainability demands

• As part of its “Green Course” strategy, AS "RĪGAS SILTUMS" needed a robust, modern ERP platform capable of supporting compliance with evolving environmental and energy regulations while enabling sustainable growth and investment planning.

Moving to SAP S/4HANA became essential to overcome these limitations while retaining existing process structures. To modernize without operational disruption, AS "RĪGAS SILTUMS" partnered with LeverX to perform a Brownfield migration to SAP S/4HANA, ensuring continuity while enabling modernization.

Solution

LeverX managed the migration using the Brownfield scenario from SAP ECC to SAP S/4HANA. The Brownfield scenario was chosen as strategically optimal because it allowed the system to be modernized while preserving valuable historical data, configurations, and established business processes. This approach minimized downtime, reduced costs, and ensured business continuity for a critically important service provider.

Key aspects of the migration included:

1.Architectural decisions and justification

The solution was based on modules and tools specifically selected to address key challenges, aligning the IT landscape with the strategic goals of the utility sector:

• SAP S/4HANA and SAP IS-U (industry solution for utilities): As part of the Brownfield migration, the existing IS-U–related processes and configurations were upgraded to the SAP S/4HANA environment, ensuring their compatibility with the new data model and system architecture.
• SAP S/4HANA Plant Maintenance (EAM): The client’s existing Plant Maintenance setup was migrated to SAP S/4HANA, enabling the system to take advantage of updated EAM capabilities available in the new platform while preserving the established maintenance processes.
• SAP BW/4HANA for real-time analytics: The analytical layer was prepared and aligned for operation within the S/4HANA ecosystem, ensuring that reporting and data structures functioned correctly after the migration without introducing new analytical implementations.

2. Key aspects of the work performed

• SAP Activate methodology framework: We followed the SAP Activate methodology, managing all stages — from Discover and Prepare to Explore, Realize, Deploy, and Run — ensuring a structured and efficient transition.
• Customer-vendor Integration (CVI) framework: To enable compatibility with S/4HANA’s data model, LeverX implemented the CVI migration framework, ensuring seamless integration of customer and vendor master data.
• Consistent user interface and real-time insights: Our specialists unified user interaction and analytical capabilities within the new environment. Modern user-friendly interfaces and real-time analytics supported performance improvement and proactive management.
• Compliance and integration: The project team also ensured system compliance with evolving local regulations during migration, guaranteeing uninterrupted operations and alignment with national energy legislation.

Technology Stack

The migration resulted in a modern SAP-based technology stack designed to ensure scalability, operational efficiency, and a smooth integration across the client’s business processes.

• Core ERP Platform: SAP S/4HANA (upgraded from SAP ECC)
  SAP S/4HANA is a modern SAP ERP system, fundamentally replacing the legacy SAP ECC.
• SAP modules implemented: SAP Finance (FI), SAP Controlling (CO), SAP Material Management (MM), SAP Sales and Distribution (SD), SAP S/4HANA Plant Maintenance (within SAP EAM)
  Core SAP modules were upgraded to support key operational areas within the existing processes across the major departments, including Finance and Controlling, Sales, Procurement, and Plant Maintenance.
• Upgraded SAP solutions: SAP S/4HANA HCM, including Payroll based on SAP S/4HANA HCM
• Complementary solutions extend core ERP functionality, enhancing HR operations and managing billing in the utilities sector.
• UX: SAP Fiori
  The activation of a role-based interface helps simplify user adoption and daily operations.
• Analytics: SAP BW/4HANA
  A data warehousing and analytics layer seamlessly integrates with SAP S/4HANA to reinforce business intelligence capabilities and provide decision-makers with prompt and valuable insights.

Results

The migration from SAP ECC to SAP S/4HANA transformed the company’s processes, creating a fundamental platform capable of eliminating systemic challenges and enabling the achievement of strategic goals.

SAP S/4HANA provides an integrated environment that supports and automates a wide range of critical business processes, from corporate back-office operations and heat network management to embedded analytics and performance monitoring.

The modernized platform now serves around 100 employees across all major departments.

Strategic and regulatory advantages

• The modernized ERP environment supports the company’s “Green Course” sustainability strategy by providing a scalable, future-ready foundation.
• The system enables proactive compliance with evolving environmental and energy regulations through improved transparency and standardized processes.

Operational efficiency and risk reduction

• Automation provided by S/4HANA across the migrated MM, SD, and FI/CO processes reduces manual workload and minimizes operational bottlenecks.
• The seamless integration of finance and maintenance functions preserved through the Brownfield migration enhances planning accuracy and helps prevent unplanned downtime.
• Improved data accuracy strengthens trust in operational metrics and supports more reliable daily operations.

Enhanced decision-making

• Real-time insights delivered through BW/4HANA accelerate strategic and operational decision-making.
• Unified and validated data increases cross-departmental visibility and enables decisions based on a single, consistent information source.

Modern user experience

• SAP Fiori provides an intuitive, role-based interface that simplifies user adoption and increases daily productivity.

Project duration:

• Migration: 11 months
• Post-go-live optimization and support: 4 months