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The project is in the Define Extension Target Solution phase because the team is actively:

Determining the technical building blocks of the solution.

Finalizing the necessary extensions to the SAP Business Partner (A2X) API using key user extensibility, a step involved in defining how the extension will integrate with existing SAP S/4HANA Cloud functionality.

Extension Target Solution Phase in Application Extension Methodology (AEM):

This phase focuses on defining the technical architecture and building blocks to fulfill the identified extension use cases.

Discussions about extending APIs and detailing the technical requirements align with this phase.

Other Options Explanation:

Assess Extension Technology (A): Evaluates the available SAP BTP technologies, which occurs before designing the solution.

Assess Extension Use Case (C): Focuses on analyzing business use cases but does not involve technical architecture discussions.

References:

SAP Application Extension Methodology