Firms shun S/4HANA for long life, mature SAP apps

With independent support offering cheaper alternatives to maintenance fees, customers are not as enthusiastic about SAP's next generation ERP as it may have hoped, a study by Rimini Street claims.

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Most SAP customers are sticking to long-running, mature SAP apps rather than considering HANA and S/4HANA, research finds.

The study of over 230 SAP business suite customers shows that despite the technical prowess offered with SAP’s high speed data processing engine and latest generation ERP, many firms are sticking to their legacy SAP apps for the foreseeable future.

It appears that SAP customers are extending the life of their core business applications. The majority of customers are using ECC version 6.0 to run their businesses (72 percent) and 75 percent are not on the most current enhancement pack release.

S/4HANA, which was unveiled earlier this year, is the German vendor’s latest ERP version which is optimised to run in the cloud and underpinned by its high-speed data engine Hana.

With 14 percent of respondents committing to using S/4HANA when it becomes available, a majority appear to be in the ‘no’ or ‘maybe’ camp, which is unsurprising for a new product.

SAP claim that 370 firms are using S/4HANA, which was only announced in February.

However, with firms stating that “no strong business case or unclear return on investment” as a reason to stick to their current software, it appears that SAP need to do more to convince their long-time users of the business benefits of following its roadmap.

The study, conducted by SAP’s rivals Rimini Street, an independent support firm that promises to extend enterprise applications at a fraction of the price of vendor’s maintenance fees, found that customers are still unhappy with the cost of SAP support. Almost half of all customers surveyed said that the maintenance fees were “too expensive for support calls” (46 percent) and a further 35 percent felt there was no support for its customisations.

The figures show that customers are still struggling to commit to SAP’s vision of an entirely cloud hosted enterprise application suite. SAP continues to be one of the most robust applications in the world, with over 282,000 enterprises relying upon its applications, however its long-term, traditional on-premise user community has continually expressed frustration over support and maintenance paying customers who will not benefit from its innovations in the cloud.

The UK and Ireland SAP User Group recently revealed that services available through SAP's premium priced enterprise support package were not being taken advantage of by customers who were still struggling to optimise their IT and not even aware of the benefits they were paying for.

With competitors like Rimini Street and Spinnaker offering a budget-friendly alternative to the major vendor’s fees,  firm’s are finding it easier to stick to one application for longer. The most popular response for not committing to an upgrade was that a firm’s current application met all its business needs (43 percent) Pressures around cost-prohibitive upgrades (37 percent) followed closely behind.

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