There is no way around a new R/4

In my numerous consulting sessions, most SAP customers cite the continuously enhanced range of functions, uniform, redundancy-free database, seamless integration of software and processes, flexible parameterization, uniform database, consistent group reporting across companies and groups as the main motive for purchasing the (very expensive) SAP software.

This opinion was also confirmed for decades, as SAP constantly brought essential improvements to its core product SAP ERP (R2, R3) to the market.

I still remember Mr. Platter defending the (high) maintenance costs by saying that SAP uses a high share of this revenue to ensure a round-the-clock service for its customers and, above all, for the functional further development and functional broadening of its ERP kernel at a state-of-the-art level.

When I look at the developments of the last few years, SAP hardly focuses on the points mentioned anymore.

Software houses such as Sybase, Business Object, Ariba, SuccessFactors and Concur were acquired for around 20 billion euros (financed, among other things, with the maintenance money from ERP customers).

However, there was no software, process, interface or tool integration into the existing ERP system that met the classic SAP requirements. The benefit for ERP customers who faithfully pay maintenance fees thus remains modest.

With Hana, you have an in-memory database, but its extreme speed increase is hardly reflected in the operational ERP modules in the form of new beneficial functions and processes.

If I were the CFO of large SAP user groups, I would question the increasingly less beneficial use of my maintenance money. I would demand that they not be used for shareholder-friendly (and bonus-generating for SAP management) activities outside the classic ERP system, but that - based on modern technological possibilities and requirements - the core SAP ERP system be further developed or, preferably, repositioned.

In my opinion, it is only a matter of time now that large, especially Central European SAP customers will no longer want to be dazzled by the US and pushed in technological directions by the Indians without simultaneous delivery of demonstrably adequate benefits.

SAP's recent path of selective functional enhancements and improvements based on S/4 Hana, while laudable, is only second best at best.

The new technologies such as Hana, Fiori, mobile development platform and IoT sensor platforms as well as the purchased software products enable completely new functions and company-wide as well as cross-company processes.

Examples are listed below:

• model-based, integrated corporate planning
• Integrated purchasing and sales processes via own and third-party platforms
• Full integration of CRM and ERP
• Ad-hoc availability and capacity checks in several variants
• concurrent, decision- and deviation-oriented reporting system
• integrated mobile processing in the warehouse, in sales, in production, in service and for managers
• cross-company processes from production planning to technical machine deployment
• software-controlled process of material flow within production
• Visualization of the production and testing processes
• Integration of machine sensors
• Preplanned maintenance incl. mechanical procurement of spare parts

In the classic SAP sense, which was the purchasing decision for most ERP customers, such a modern, end-to-end, integrated new ERP solution cannot be successfully implemented by "grafting" onto the existing ERP, but only by a "greenfield approach" in the form of a new SAP product R/4.

This requires a lot of time, expert resources, labor-intensive design, and probably new development tools.

However, I am convinced that if SAP were to use their customers' maintenance money for this, they would have little objection and would finally be back in joyful anticipation of a new ERP product whose benefits do not have to be explained to them.