Why migrate to S/4HANA if field inventory remains invisible?

I spent more than two decades inside SAP’s services organization, running global delivery for a professional services business that, at its peak, executed on a services portfolio spanning all industries and worth north of €3 billion.

Where value leaks

If twenty years of watching transformation programs taught me one thing, it’s this: while technology almost always goes in on schedule, value almost always leaks out somewhere else. Today I lead field operations and strategic customers for mymediset, where our entire reason for existing is to close one specific version of that leak in the MedTech industry — what happens to inventory the moment it leaves the distribution center and enters the field.

So, when Andreas asked me to write about S/4HANA, I didn’t want to write another technology migration piece. I wanted to write about the question almost no S/4HANA business case asks: if you can’t see your field inventory today, what exactly does moving your ERP core to S/4HANA fix?

The blind spot hiding in plain sight

In MedTech, “field inventory” means loaner instrument sets moving hospital to hospital, trunk stock riding in a sales rep’s car, and consignment inventory sitting in a hospital’s supply room under the manufacturer’s ownership but the hospital’s roof. It is not a rounding error. Terso Solutions, citing an independent healthcare industry consultant’s study of 49 publicly traded medical device manufacturers, found the median company carries field inventory for 137 days before it moves, nearly half a year, and the slowest-moving company in the sample carried it for more than 400 days. The same research put annual write-offs at 1–4% of inventory value industry-wide, purely from product expiring or going obsolete before anyone found a use for it.

Zoom out to the provider side and the blind spot gets starker still. GHX ran physical inventory counts at two U.S. hospitals, each expecting to find roughly $5 million in supply inventory. They found $51 million at one and more than $15 million at the other. That’s not a rep losing track of a tray. That’s tens of millions of dollars of manufacturer and hospital-owned product that nobody’s system of record actually knew existed, invisible to finance, invisible to supply chain, and, when a recall hits, invisible to the one function that most needs to find it fast.

About that “10–30%” number

You’ll hear MedTech operations people quote that companies can recover 10 to 30% of the value tied up in field inventory through better visibility. Across mymediset’s customer base, we’ve measured a composite 35% reduction in consigned inventory write-offs after implementing real-time field visibility, alongside a 42% drop in expired product and +60% less time that reps spend on manual inventory administration: the value sitting unrecovered in field inventory is real, it is material, and it calls for better visibility.

Why S/4HANA doesn’t touch this

Here’s where my SAP years are directly relevant. S/4HANA migrations are architected, quite deliberately, around a concept SAP calls “clean core”: keep the standard, real-time transactional backbone as untouched as possible, and push anything industry-specific or process-specific out to an extension layer on BTP rather than customizing the core itself. That’s the right architecture for a platform meant to run for the next decade. It is also exactly why nobody should expect an S/4HANA migration, on its own, to solve field inventory visibility that the platform was never designed to. Clean core is SAP explicitly telling you: the last-mile problem is your extension layer’s job, not the core’s.

That’s not a criticism of S/4HANA. It’s a reminder of what a platform migration actually is. It rationalizes and modernizes the system of record. It does not, by itself, extend visibility into a rep’s trunk or a hospital storeroom, because that visibility was never generated inside the core to begin with. It was generated, or more often not generated, in spreadsheets, phone calls, and manual counts happening entirely outside SAP’s view. Migrate that gap to S/4HANA and, a year and a considerable budget later, you get a faster, cleaner, more expensive version of the exact same blind spot.

What has to change

Three things, and none of them is “wait for the ERP program to fix it.”

Process. Field inventory needs an accountable owner and a defined operating cadence, the same way a warehouse does. In most organizations I talk with, it’s implicitly owned by whichever sales rep touched it last, which in practice means it’s owned by no one, and an asset with no owner doesn’t get counted, reconciled, or protected the way the rest of the balance sheet does.

Data. The field and the core need one shared, real-time source of truth, not a monthly reconciliation between what SAP says shipped and what a rep’s spreadsheet says is on hand. Every day that gap exists is a day expiration dates, recall exposure, and utilization data are wrong somewhere in the system, and wrong data compounds.

Systems. This is where a solution purpose-built for field execution earns its place: requests for inventory captured and recorded in SAP; inventory use captured at the point of use; mobile transactions synced back to the core in real time; hospital-integrated visibility for consigned stock; ability to move inventory from rep to rep, hospital to hospital, distributor to distributor, so it is easier for them to do it, and not something that is easier to do outside the SAP system. Built as a clean core solution that connects in real time to S/4HANA rather than a shadow system running beside it in Excel, or other data sources that must be synced to SAP — this is what turns the core’s data model into something that’s actually true, rather than something that’s merely current.

The real question for your business case

Twenty years of watching services organizations chase profitability targets taught me that the projects which move the needle are rarely the ones with the biggest technology line item. They’re the ones that fix where the organization’s attention isn’t already looking. For most MedTech companies right now, that’s the field. S/4HANA is necessary. On its own, it is not sufficient. Before you sign off on the next wave of your transformation business case, ask the question the program plan probably hasn’t: after we migrate, will we finally be able to see where our inventory actually is, or will we just have modernized the parts we could already see?

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Tony Martinez is Senior Vice President, Strategic Accounts & Partners at mymediset, where he works on field inventory visibility for MedTech supply chains built on SAP. He spent more than 20 years in SAP’s services organization in global delivery, quality, and business operations leadership roles. He writes here in a personal capacity; the views are his own. Figures attributed to mymediset are composite, self-reported customer results, disclosed as such.

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