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ECC Deadline Disaster

The SAP community is heading for a disaster in the making because hardly any experts know the true status of their S/4 implementation. SAP's numbers only reflect sales. How many S/4 systems are actually productive?
Peter M. Färbinger, E3 Magazine
June 19, 2024
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Licenses versus revenue

An SAP partner recently raised eyebrows with an impressive sum. This partner's successful S/4 release upgrades are the foundation for billions of dollars in revenue for SAP customers. This is a market figure that clearly indicates the success of S/4 Hana. An IT tool that is responsible for this revenue on a daily basis can only be good!

However, SAP itself is flying blind. SAP counts S/4 contracts without knowing whether the licenses are in the drawer or in a pilot project. For the time being, the SAP community should not use this as a basis for accusations and recriminations. Nonetheless, the conclusion could be dangerous. If SAP makes the wrong assumptions in its planning and thinks that the 2027 ECC deadline is not a problem, then disaster could loom on the horizon for SAP customers.

Deadline 2027 threatens AI hype

Any form of AI requires a robust and validated database. This database is created with the S/4 conversion. However, SAP customers cannot fire on all cylinders at the same time. Digital transformation must be orchestrated. New end-to-end processes must be designed. Data must be archived and verified. There is a lot to do before the S/4 conversion can be successfully completed.

S/4 conversion is an excellent foundation for future AI applications. But SAP customers must hurry! For many customers, orchestrating, archiving, and consolidating SAP ERP systems will continue well beyond 2027, whether due to a lack of staff, expertise, or partners. A transformation study by NTT Data Business Solutions and Solutive identified organizational deficits, lack of transformation expertise, and lack of external consultants as innovation killers in times of upheaval. There was a live discussion on the subject on the E3 YouTube channel on June 18, which you can watch and listen to here (in German).

The AI hype at Sapphire 2024 Orlando is not wrong. However, it is threatened by the homework that SAP has not yet done. Until ERP algorithms and data structures are consolidated and a stable S/4 system is in place, it is dangerous to think about any kind of AI deployment.

AI implementation is a marathon, not a sprint

"2023 was a year of awakening, with every organization experimenting with AI and GenAI use cases. Now we are entering an era where AI is being widely adopted in enterprises," said Harrick Vin, Chief Technology Officer, TCS, adding: "However, organizations are realizing that the path to implementing AI solutions is not easy and building an AI-ready organization is a marathon, not a sprint."

SAP is delivering its AI applications as promised, but the foundation is still lacking. With 2027 just around the corner and many S/4 release changes still to be completed, there is a risk that SAP's AI will become an afterthought. SAP AI isn't bad; it's just incorrectly positioned. Just as a house cannot be build on sand, so must SAP AI be built on a sturdier foundation. SAP knows very little about its own market and about true S/4 conversion. These technical mistakes lead to big risks.

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Peter M. Färbinger, E3 Magazine

Peter M. Färbinger, Publisher and Editor-in-Chief E3 Magazine DE, US and ES (e3mag.com), B4Bmedia.net AG, Freilassing (DE), E-Mail: pmf@b4bmedia.net and Tel. +49(0)8654/77130-21


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Working on the SAP basis is crucial for successful S/4 conversion. 

This gives the Competence Center strategic importance for existing SAP customers. Regardless of the S/4 Hana operating model, topics such as Automation, Monitoring, Security, Application Lifecycle Management and Data Management the basis for S/4 operations.

For the second time, E3 magazine is organizing a summit for the SAP community in Salzburg to provide comprehensive information on all aspects of S/4 Hana groundwork. All information about the event can be found here:

SAP Competence Center Summit 2024

Venue

Event Room, FourSide Hotel Salzburg,
At the exhibition center 2,
A-5020 Salzburg

Event date

June 5 and 6, 2024

Regular ticket:

€ 590 excl. VAT

Venue

Event Room, Hotel Hilton Heidelberg,
Kurfürstenanlage 1,
69115 Heidelberg

Event date

28 and 29 February 2024

Tickets

Regular ticket
EUR 590 excl. VAT
The organizer is the E3 magazine of the publishing house B4Bmedia.net AG. The presentations will be accompanied by an exhibition of selected SAP partners. The ticket price includes the attendance of all lectures of the Steampunk and BTP Summit 2024, the visit of the exhibition area, the participation in the evening event as well as the catering during the official program. The lecture program and the list of exhibitors and sponsors (SAP partners) will be published on this website in due time.