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ASUG/DSAG members like S/4HANA, but implementations still lag

S/4HANA is viewed positively by most SAP customers, according to a new survey of ASUG and DSAG members, but complexity of an S/4HANA move may be delaying implementation projects.

For SAP S/4HANA, actions may speak louder than words.

In a new survey of SAP users jointly conducted by the two largest SAP user groups globally, ASUG (Americas' SAP Users' Group) and DSAG (the German-speaking SAP User Group), SAP customers reported positive impressions of  SAP S/4HANA. But the number of SAP customers that have gone live on the next-generation ERP system still remains low.

The survey marks the first time the two user groups have combined research. It included responses from 700 user group members, 483 from ASUG and 217 from DSAG, from companies around the globe that have a variety of SAP systems installed.

The survey looked at SAP purchasing decisions and product use, attitudes on SAP and S/4HANA, S/4HANA implementations and the impacts of S/4HANA on organizations.

Positive impressions of S/4HANA

Attitudes toward SAP S/4HANA were positive, according to the survey. Of the ASUG members, 17% rated their impressions of S/4HANA as "extremely positive," and 41% rated them "somewhat positive." The impressions among European users were similar, with 11% of DSAG members rating impressions of S/4HANA as "extremely positive" and 40% as "somewhat positive."

At the other end of the scale, only 1% of both ASUG and DSAG members rated their impressions of S/4HANA as "extremely negative," while 6% of ASUG members and 13% of DSAG members said they regard the next-gen ERP in a "somewhat negative" light. Additionally, the survey reported that 0% of respondents who were live on S/4HANA rated their impressions as "extremely negative."

Although there are some small differences in impressions, Geoff Scott, ASUG CEO, said he found it surprising that both user groups were aligned on many issues.

"The data tells us that those who have come out the other side of their migration are largely feeling positive about their experience," Scott said in a webinar that discussed the survey results. "Generally speaking, we're hearing common themes [from ASUG and DSAG] across the market globally. There are some different nuances that we attribute to cultural differences and different ways to approach, but by and large, we are surprisingly aligned on the big-picture items such impressions of S/4HANA."

SAP user survey

S/4HANA still not widely used

For all the positive talk, the survey also indicated that S/4HANA is still not widely used by SAP customers.

Currently, just 16% of ASUG members and 12% of DSAG members reported that they are live on S/4HANA; 22% of ASUG members and 23% of DSAG members are in the process of moving to S/4HANA; and 33% of ASUG members and 47% of DSAG members are planning an S/4HANA move but haven't started the process yet.

Just 6% of respondents from both ASUG and DSAG responded that they have no plans to move to S/4HANA. For ASUG respondents, the top reasons for the lack of S/4HANA interest included high costs and lack of a business case. For DSAG respondents, the top reasons were the lack of an immediate need and uncertainty about functionality in S/4HANA.

Those planning to migrate will not start right away, for the most part, however. The survey indicated that a vast majority of ASUG respondents will take anywhere from one to five years to move to S/4HANA -- 37% within one to two years and 35% within three to five years. For DSAG survey takers, 47% plan to move to S/4HANA within the next three years, whereas 38% will take more than three years.

Complexity delays S/4HANA implementations

Delays in an S/4HANA migration can be attributed mainly to the complexity of the move as well as variations in each organization's approach due to their own business conditions, Scott said. This is especially true now because of the COVID-19 crisis.

"The size and complexity [of a migration] is a major part of this," Scott said. "The more people you get involved in this … [and as] the migration process and data clean-up processes … start to layer one on top of the other, the more challenging it becomes and the more the timeline suffers," Scott said.

An S/4HANA migration is more than just a technical project, but one that involves a real transformation of business processes, according to Scott. Organizations have to take the time to do this carefully or risk implementation failure.

The last thing that customers want to do is rush an implementation and then find out that it's not accurately reflecting their business processes.
Geoff ScottCEO, ASUG

"The last thing that customers want to do is rush an implementation and then find out that it's not accurately reflecting their business processes, and then have to back that up to get the business processes back up and running," he said. "It takes time to think through business processes in a different way in order to modernize them."

The S/4HANA capabilities go beyond what current legacy systems offer, so organizations must change business processes before they can take full advantage of the new capabilities, said DSAG board member Otto Schell.

"You have to break down the wall between [functional areas like finance and controlling]," Schell said. "If you want to look into things like machine learning opportunities, you need to go back to the organization and they have to apply changes to the organization. But to get to this point, you have to go much deeper into business processes, and that's why it may take longer to get to S/4HANA."

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