Deadline 2025: For whom and what?

SAP has celebrated its successes with early adopters. There are numerous S/4 Hana reference installations. Spectacular Green, Blue and Brownfield projects have proven the feasibility of an S/4 transformation and the subsequent added value.

SAP could be satisfied if there were not one major flaw in this picture: The successes achieved do not scale! The S/4 innovators are not followed by early adopters or an early majority, see diffusion theory and distribution of innovations.

The economy of scale pales in the overall S/4 picture! Only 173 S/4 systems went live in North America in 2019 - according to a mid-January SAP Fkom presentation in Las Vegas.

At the moment, Hana and S/4 are not suitable for the masses and thus the end date becomes a disaster. There are countless success stories and positive proof-of-concepts for Hana and S/4, BW/4 and C/4 - technically, organizationally and in part also in terms of licensing law, but not in terms of business management! Why?

The answer is very simple: Hana and S/4 require the resources of a new ERP implementation. Despite all the tools, partnerships and programs, the transformation to S/4 is a huge step and not a simple release upgrade.

Everything stays better is an ambivalent promise: S/4 Finance shines with simplicity and new possibilities. So far, almost every CFO has been thrilled with the result - but the road ahead is still too arduous, too uncertain and too expensive for many existing SAP customers.

"The forces were small. The goal was in the great distance, it was clearly visible, although hardly reachable for me".wrote Bertolt Brecht (1898 to 1956) in his famous poem "To those born after".

There is a deadline of 2025 - but for whom does it apply? SAP has terminated the database contracts with Microsoft, Oracle and IBM. The status of the Sybase databases ASE, IQ and SQL Anywhere is unresolved.

Hana thus seems to be the only chance for existing SAP customers, but the user association DSAG wants to fight against this. During a DSAG meeting, board member Andreas Oczko said that not only the 2025 end date for ERP/ECC 6.0 and SAP Business Suite 7 is up for discussion, but also the unique selling proposition of Hana.

As unrealistic as these thoughts may seem at SAP headquarters in Walldorf, they just as stringently reflect the reality in the SAP community.

DSAG board member Andreas Oczko is right to demand an alternative to the S/4 Hana deadline of 2025 on behalf of his members. The demand is not based on the product quality or functionality of Hana and S/4; nor is it based on the still unfulfilled promises of SAP's co-CEOs Jennifer Morgan and Christian Klein to finish the missing integration of SAP's cloud acquisitions, but the demand reflects exclusively the state of the SAP community. The DSAG user association is very close to SAP's existing customers and therefore knows best about their sensitivities.

On a sober note, Jennifer Morgan and Christian Klein have to correct the 2025 deadline - to the advantage and benefit of existing customers and possibly to the disadvantage of certain SAP partners.

In purely mathematical terms, sticking to the 2025 deadline would lead to a massacre because there are too few experts and consultants for an orderly S/4 version change, which is ultimately - whether Green, Blue or Brown - a new ERP implementation and could therefore make some SAP partners a lot of money.

In the remaining years, the daily rates of external consultants would rise steadily. The thousands of medium-sized companies in the SAP community in particular would be overwhelmed by this financial commitment.

Hardly anyone doubts the right path, the right direction of SAP. The DSAG association also sees Hana and S/4 as a right answer to the upcoming digital transformation.

But because SAP itself has not yet done its own homework in many areas, the current pace of development is far too fast. In the Spiegel interview, SAP Co-CEO Christian Klein said:

"I see us on a good path and am confident. If we do the homework assigned to us and successfully accompany our customers into digitization, this will also be reflected positively in the share price." (Source: Der Spiegel, No. 2, January 4, 2020, page 61)

SAP's existing customers should be able to rely on the successful work of DSAG board member Andreas Oczko and calmly go about their planning for a new ERP S/4 implementation. SAP can leave ERP/ECC 6.0 in maintenance for a few more years without any problems.

The challenge with SQL databases from Microsoft, Oracle and IBM alone still awaits a stable and affordable solution - but Jennifer Morgan and Christian Klein still have five years for this solution, don't they?