A recent Rimini Street survey says that in spite of the announced 2025 end of life for core applications in SAP Business Suite 7 ERP product and older versions, “Of the IT leaders surveyed, two-thirds state they either have no plans to migrate to S/4HANA (35%) or are undecided about moving to S/4HANA (32%) ”
IDC, on the other hand, surveying 300 of its clients concludes “it’s not a matter of if companies will adopt SAP S/4HANA anymore, but when.”
Steve Miranda of Oracle tells Diginomica “We’re pretty comfortable with our strategy of supporting customers who are on-premise and want to stay that way (with support from Applications Unlimited) until the time is right for them to make a move. I feel good about that.”
UpperEdge, on the other hand, argues that under pressure from Wall Street “So ready or not, Oracle will be trying to force migrations according to their own timeline.”
Who to believe? In my recent book, SAP Nation 3.0 I had profiled several risk-takers, modernizers and diversifiers in the SAP customer base who have been refreshing their application portfolio. The biggest segment is still what I called Bystanders which are not moving – they make up about 60% of the base of over 400,000 customers. I had a whole chapter where I provide guidance to SAP to “tilt the bell curve” and energize the Bystanders.
Others make similar points in the book
“Mueller of Constellation said, referring specifically to ECC and moves to S/4:
“The next two or three years will show if SAP can create the value proposition. We’ll see how much customers push back. SAP could say, ‘We listened to our customers and we will give you another two or three years (beyond 2025), but you have to pay not 18%, but 21% or 25% or maybe even 30% in annual maintenance.’
However, the writing has been on the wall and for years now. It should have been clear to every CIO that the innovation is happening on the S/4 side. Do you want to be in 2030, 11 years from now, with an ERP system that cannot run machine learning, which doesn’t have a good IoT story and so on?”
Or as Wright of Accuride and Howlett of diginomica have pointed out, it’s tough enough today to recruit younger talent to an ECC and ABAP shop. Can you imagine what it will be like in 2025 or 2030?”
By all means, listen to all these perspectives, but in the end make your own hard-nosed decision. Actually decisions. Revisit them every year. The market is changing rapidly.
As I show in the book, the SAP world has dramatically changed in the last few years. So many new products – not just S/4, C/4, SCP, SAC, Qualtrics, AIN, BCP. So many cloud flavors. You should also get clarity on upcoming releases, especially around vertical and geographic functionality that keeps growing.
Oracle has an even more acute Bystander issue – by my estimate 80% of their customer base is in the Bystander category, and they have not been as forthcoming about their next-gen products. They keep talking about their financials, hr and crm – not so much about the rest of the enterprise. So, they have an even bigger challenge – and opportunity – to tilt their bell curve. As a customer, use it to your advantage.
Also take advantage of the market bounty. These are not either/or options. We live in multi-vendor, multi-cloud worlds. In my book, EBSCO which went with Rimini for third party maintenance, describes how they continue to buy new products from SAP. I have talked to other Rimini customers who are moving to next-gen applications over a few years, and in the meantime move their legacy apps with significant customizations to Rimini.
Don’t wait for a vendor-driven EOL date and then have to fight a crowd of your rushed peers. Plan how and when at your own terms. You should be deciding the EOL of your legacy applications.
(Cross-posted @ Deal Architect)