The end of maintenance for old SAP ERP systems announced by SAP in 2027 or 2030 is approaching fast. The remaining time is now quite limited if you want to get things right. “Change takes time. Companies that have not started dealing with their transformation today, are at risk of missing the 2027-time window,” says Michael Brecht, Solution Architect at Nagarro. “If companies want to add real value to their business and to lay out a sound foundation for further development, a migration to SAP S/4HANA will not work in 6 months. Companies are urgently advised to allow for a lot more time and plan accordingly.”
What is the status quo at companies in 2023?
What stage of transformation are companies actually in? Nagarro conducted a survey of 50 IT decision makers on this topic as part of the IT Online Conference in January 2023 with interesting results.
When is the change planned?
Almost half of all respondents are still putting the issue on the back burner and are not planning a changeover until 2025 or later. Only a third of all respondents stated that an SAP S/4HANA project has already been completed or is due in 2023. 22% see the changeover in 2024 as realistic.
However, the vast majority of IT decision-makers seem to be very well aware of the need for a transformation and state that they are already at a stage in which the changeover is specifically planned. A third of the respondents are already in the preliminary study (40% in the previous year), 41% are developing a roadmap (value from the previous year’s survey: 34%) and only 5% say they want to wait and see. In comparison: in 2022 this was still 12% of those surveyed.
Which deployment models are preferred?
While in 2022 the majority of respondents still opted for an on-premise model or a hybrid model, a clear trend towards cloud-based solutions can be seen this year. The private cloud (almost 26%) and the public cloud (approx. 17%) are still well behind the alternative deployment models in favor of decision-makers, but the decision in favor of a public cloud variant at 15% increased significantly compared to the previous year (2.5%). So, cloud-first strategies seem to be growing in popularity.
But, regardless of which path might be the right one for you and your company: It is important that this decision is taken promptly!
Whether it is time pressure alone that is pushing companies to make the change or whether other reasons play a role: Although some still seem to be hesitant, IT decision-makers are becoming more and more aware of the urgency of a system change.
Of the possible entry-level models in S/4HANA – on-premises, private or public cloud – the majority of those surveyed currently prefer hybrid models. Pure public cloud solutions are clearly gaining popularity among those surveyed but are still chosen less frequently. This trend is sure to continue as SAP continuously improves the model and increasingly eradicates points of criticism. Public cloud variants can offer a quick and low-threshold entry into the SAP S4/HANA world, especially for small and medium-sized companies.
With the right partner at your side, it is possible to create a customized path and find the optimal strategy for each company and to follow it successfully with the acceptance of the entire workforce.
It’s time for a change! Our SAP S/4HANA expert Michael Brecht as well as our entire team are happy to advise you. Do not hesitate to contact us.