What is the difference between configuration and customization in SAP S/4HANA?

The correct answer focuses on the key distinction between configuration and customization within SAP S/4HANA. Configuration involves utilizing the pre-defined options, settings, and parameters available within the software to meet specific business requirements. This process allows businesses to adjust the system's behavior and functionality without altering the underlying source code, making it a more straightforward and less risky approach.

On the other hand, customization refers to the process of modifying the source code or the application's standard functionalities to cater to specific business needs that cannot be addressed through configuration alone. This often requires deeper technical expertise and can involve more complexity and potential maintenance challenges over time.

Understanding this distinction is vital for organizations when deciding how to implement SAP solutions. Effective use of configuration can lead to quicker implementations and lower costs, whereas unnecessary customization can complicate upgrades and increase long-term support overhead.