Functions, Tools, and Methodology for the SAP Community

With the business strategy announced at the Business Unleashed event in February of this year, SAP is focusing on the core elements of processes, data and AI with the aim of providing efficient process chains. In addition, more and more end-to-end processes are to be offered in the cloud and the various IT stacks and cloud services are to be combined on the basis of the BTP (SAP Business Technology Platform). "Even though SAP is undoubtedly working on harmonizing and integrating the solution portfolio, a consistent architecture is the key to success for the envisaged Business Suite. To achieve this, SAP must continue to harmonize the product landscape and consistently implement uniform standards, e.g. for data models and identity and security services. By definition, a suite requires the seamless integration of the SAP solutions it contains, uniform operating models and clear migration and implementation strategies along the way," said DSAG Chief Technology Officer Sebastian Westphal in Wiesbaden at the DSAG Technology Days 2025. This idea of integration with functions, tools and methodology is the self-imposed claim of SAP partner Nagarro as well as the successful added value for the SAP community.

DSAG members and existing SAP customers expect the successor to S/4 to be a modular business suite that can be flexibly adapted to company requirements and integrated into overarching company architectures without great effort or cost. "And of course, the commercial advantage of a suite must also be clearly evident if everything comes from a single source with SAP. Both technically and commercially - in other words, transparent cost structures and contract models," said Sebastian Westphal in Wiesbaden. As it is unlikely that one business suite will be able to cover all of today's use cases, long-term support is required as part of the SAP Clean Core strategy. With its expertise and methodology, Nagarro offers the SAP community a long-term roadmap to next-gen ERP and describes itself as a full-service provider in the SAP scene. What are Nagarro's strengths? "We cover the SAP portfolio and are independent in terms of technology, deployment and experience," emphasizes Jörg Dietmann, Co-Founder of Nagarro, at the start of the E3 discussion. "We offer everything from our unit and pursue corporate goals rather than the goals of individual divisions. This allows us to advise our customers on an equal footing and keep SAP's strategy in perspective." Is the public cloud the goal for all companies, asks Jörg Dietmann and answers directly: "Certainly - precisely because SAP wants to offer AI and data-supported functionalities that are based on a standardized data foundation and systems. Otherwise it couldn't be rolled out at all."

Hana, S/4 and AI

Can SAP's AI be implemented in the short term? "No," says the co-founder of Nagarro. "According to studies, around half of existing customers are still not on S/4 Hana. And time is passing quickly, because mainstream maintenance for ECC systems on EhP smaller version 6 is already coming to an end this year," says Jörg Dietmann, explaining the challenging situation in the SAP community. With Extended Maintenance, existing SAP customers still have time until 2027 or 2030, depending on the release and budget. The very last option until 2033 is available for customers with complex systems who are already considering a Rise option and are already realizing that they will not be able to complete the project within the timeframe of at least 18 months.

SAP ERP, Private Edition, Transition Op-tion 2033 is designed to help the largest and most complex existing SAP customers plan, execute and implement their cloud S/4 conversion. This new offering is an ERP cloud subscription with SAP ECC 6.0 as the central component. A range of special services supports companies in their transformation to cloud ERP. In addition, business continuity is supported with patches for security, legal and software issues. The transition option will be available for purchase from 2028 and can then be used from 2031 to 2033. SAP is announcing this offer in advance, as existing customers with complex landscapes require advance notice. It is an additional and non-mandatory offer. Customers who plan to complete their transformation by the end of 2030 do not need it. SAP ERP, Private Edition, Transition Option is for customers who need additional time and support.

Where does Nagarro still see weaknesses in the SAP offering? "We still see some weaknesses in the area of hosting," says Nagarro manager Dietmann. "But I'm saying this on behalf of a company that has been operating SAP systems in its own data center for over 25 years and therefore has a very deep insight into the subject. It was clever of SAP to say that they have an offering that includes hosting, namely Rise with SAP. However, it is still in its infancy and you can see that in the SLAs. It will be interesting to see how SAP's hosting offering changes as a result of the economic and political situation in the USA. Sovereign cloud is a buzzword that is driving our colleagues at StackIT. It would be a no-brainer for us if SAP were to give Rise hosting back to its partners - unfortunately, this is not part of the portfolio at the moment."

New Business Suite First

In order to achieve the goal of a cloud ERP system as part of the Business Suite, either as a public or private cloud edition, customers should embark on a Rise or Grow journey in future. The problem with this: "The Rise product is not necessarily more cloud than an SAP system that already runs on a cloud infrastructure, as SAP itself admits. It therefore requires consistent further development into a uniform operating model for all SAP services used. A high degree of integrability into existing operating and service processes of the user companies is therefore an important success factor," says DSAG board member Sebastian Westphal. For medium-sized companies in particular, it is important that their enterprise architectures can be operated in a comprehensive and standardized manner. DSAG welcomes the fact that the Rise Migration and Modernization programme launched last year is to be continued for 2025 under a new name. However, Nagarro is also aware that expectations in the area of Rise and private cloud delivery are still diametrically opposed. Existing SAP customers are sometimes used to different SLAs than what SAP can offer. Hosting was not previously part of SAP's core business, which is why stakeholder management is sometimes required from all sides. "That's why we always emphasize how important it is to have a basic team that also supports customers when things go wrong," says Jörg Dietmann in the E3 interview.

"Integration, data and AI are topics that have always driven SAP, but are currently taking on a whole new relevance," says Julia Rettig from Nagarro, where she is responsible for SAP Go-to-Market. "SAP is arriving in the cloud business. However, this is also changing the approach of consulting and implementation partners. In the future, we will develop even more in the direction of process consulting. The more public cloud or SaaS products are introduced, the more the standard will be accepted and functionalities that cannot be mapped there will have to be developed separately," says Nagarro manager Rettig.

SAP is building on over 50 years of experience in standard software in the ERP business and is therefore focusing on the critical core processes of companies. "If the consultants focus even more on processes from now on, they will create completely new added value in the ecosystem," explains Julia Rettig with regard to her practical work. "Because it's no longer just about the question: How does the software adapt to my company? But rather: How do I adapt the standard processes to established best practices and which functionalities do I map outside of the standard?"

Systems, tools and methodology

Nagarro wants to equip existing SAP customers with systems, tools and methodologies so that they can operate as autonomously as possible and the core competence teams can concentrate on strategic and innovative topics. "This is exactly how innovation should work," emphasizes Julia Rettig in the E3 interview. "Because, let's be honest, innovation doesn't take place in standard processes." One example is financial processes, which are rarely differentiated, but rather regulated or standardized. Such processes can, should and must be mapped in the standard in order to speed up consolidated financial statements and audits. "The music is then played in the free spaces," explains Julia Rettig.

SAP is doing the right things globally, according to Nagarro, but this also includes some developments that will not become established or accepted overnight, such as on-prem versus cloud. "The motto here is that companies need to know themselves well and prepare their processes transparently in order to then develop a short, medium and long-term strategy for themselves. And if companies need support in creating an SAP strategy or have lost track of the SAP portfolio - which can easily happen with all the renaming of products and offerings - then we are there to help," explains Nagarro Manager Julia Rettig.

Where does Nagarro currently see SAP's greatest strengths? "SAP's greatest strength continues to be its end-to-end approach," says Julia Rettig. Since 1972, the ERP provider SAP has positioned the keywords integration, real-time and processes at the very top. Not much has changed in more than 50 years of market leadership. "Unlike the external factors - these are known to be constantly changing," says Julia Rettig. This includes analysis options in SAP ERP systems through Hana, the exchange of systems with the help of AI agents and Datasphere and Business Data Cloud as a uniform data platform. "In summary, SAP's strength lies in offering a transparent and efficient enterprise architecture that transcends individual areas and silos. In theory, this sounds relatively banal, but in practice it is very complex," says Julia Rettig, who knows this from her professional experience with successful existing SAP customers.

In terms of planned investments, S/4 Cloud is gaining ground. For example, 68 percent of those surveyed by the DSAG user association stated that they wanted to invest in S/4 Private and Public Cloud. 42 percent want to invest in S/4 On-prem and 23 percent want to invest in the old SAP Business Suite 7. "The results show a clear shift towards cloud solutions. It is often large companies whose digital transformation strategy is a reason to migrate to the cloud," summarizes DSAG CEO Jens Hungershausen, adding: "Many larger companies have a group-wide cloud strategy or requirements to modernize IT processes. At the same time, there is usually a greater level of investment here." For the second time, existing customers of DSAG and SAP were asked how they rate SAP's S/4 Cloud strategy. The first survey in 2024 was conducted before the launch of the new SAP program Rise with SAP Migration and Modernization, which includes incentive measures when moving to the cloud. At the time of the survey for this investment report (20 January 2025 to 14 February 2025), the program can be considered established. This time, 40 percent attest to the program's high and medium relevance. "While only 13% of respondents gave a positive assessment of the S/4 Cloud strategy in the last investment report, this year the figure is 38%. The SAP program seems to be bearing fruit," says Jens Hungershausen. Incentivization is also set to continue in 2025, with an official announcement expected in the coming weeks. From DSAG's point of view, however, this must be a permanent offer that continues to provide added value for existing customers.

Rise and Grow with Suite First

Is SAP's Rise and Grow offering the right path to the cloud from Nagarro's perspective? "That's difficult to answer in general terms," says Julia Rettig. "In the long term, we see the public cloud as the system of choice. But a lot has to change before then, both at SAP and with customers. On-prem is currently still supposedly the safest option for many existing customers - but in my view, this is often a philosophical and cultural issue in companies and needs to be considered on an individual basis. SAP is also aware of this, as the on-prem version is still in maintenance until 2040. On-prem is still in maintenance until 2040. Nevertheless, SAP's strategic path is clearly moving towards the public cloud - with detours via on-prem or private cloud. It should also be noted that many companies do not yet have a public cloud fit, which is a major issue in the regulated industry in particular." Nagarro colleague Jörg Dietmann adds: "In addition, many SAP customer projects do not even consider the new functionalities - the focus is first on converting the system and the innovation phase is often deprioritized. In my opinion, this is a fatal mistake, because you end up with a lift-and-shift project with the same limitations and pitfalls that existed before, only on S/4 Hana. It is clear that the question of why such a mammoth project was initiated is then asked. S/4 transformations undoubtedly need a strong foundation. This phase is important in order to realize the innovative projects that follow and to leverage the potential of S/4 Hana. But you can't stop in the middle - or you just go greenfield."

SAP has been very busy in recent years and the abundance of new products is hard to keep track of. "Yes, of course we are also constantly learning, certifying and experimenting," explains Jörg Dietmann and emphasizes: "Nothing is more constant than change, and when SAP twitches, the ecosystem twitches. It's essential for us to be up to date, that's our job. That's why we have an internal team that deals exclusively with SAP Learning and Development. Well-trained consultants are the core of our work. On the other hand, it is of course also important that we pass the SAP certifications and thus influence our partner status. Without a top team, there is no top level in the SAP Competency Framework."

Julia Rettig confirms this statement: "If you are constantly looking at the SAP portfolio, then everything really does make sense - it marks the development towards a cloud-first company. What helps is to differentiate between offering, tools and methodologies in the portfolio. Of course there are overlaps: Integration and development tools such as SAP Build or SAP Business AI can be found under the guise of the Business Technology Platform, but are also part of offerings such as Grow or Rise."

End-to-end processes

NNew challenges and E2E business processes require an adequate ERP architecture: can S/4 Hana now become this after ten years - or will it move towards Composable ERP with BTP, BDC and New Business Suite? On this question, Julia Rettig explains: "End-to-end has always been SAP's vision. Personally, I was a big fan of the intelligent enterprise concept and the vision of end-to-end integrated processes. Fortunately, SAP is also continuing to develop in this area. I also welcome the increasing focus on enterprise architecture - with new global working groups, acquisitions such as LeanIX and Signavio and the importance in the community. This is the right step, because in addition to the focus on SAP, there are often other systems in enterprise architecture that also need to be considered."

Commenting on the SAP roadmap, Manager Rettig says: "One trend that I am observing with Rise, Grow and BDC is the move away from systems towards processes. Until now, ERP has always been the core of this architecture from SAP's perspective - now we are seeing the Business Data Cloud. This is exciting and understandable if you look at it from SAP's perspective. For us, this will mean in the long term that we will no longer advise companies in systems, but in processes."

According to calculations by the analysts at Apps Run The World (ARTW), SAP lost its ERP market leadership to rival Oracle last year. How was this news received? Nagarro co-founder Jörg Dietmann: "It was exciting news. However, it probably caused more of a stir in Walldorf than here. If we put this into perspective, we can see that at ARTW, the IT groups SAP and Oracle, which are both in a neck-and-neck race, each have a rounded market share of 6.6 percent. If we then look at global trends and growth in the ERP market as a whole, we can all be reassured. On the one hand, the ERP market is growing steadily and on the other, there is still a lot to be gained for SAP. What is much more exciting for us is the development in deployments. We can see, also in view of the figures in the DSAG investment report, that more or less half of existing SAP customers continue to use on-premise ERP or at least continue to rely on this option in the medium term. The public cloud is nevertheless experiencing significant growth - driven primarily by SAP customers who want to get very close to the standard very quickly or by new SAP customers. But once again: in general, we see that there is still a lot of potential in the ERP market - and then, of course, SAP goes beyond ERP with its in-house portfolio. The announcement of the SAP Business Suite - not to be confused with SAP ECC! - and the SAP Business Data Cloud."

The DSAG user association has chosen "The Art of Balance" as the motto for its annual congress in Bremen in 2025. What trends will shape the SAP community in the coming months and what are the resulting priorities for collaboration with existing SAP customers? "We are also looking at balance, in our portfolio and in our offering," emphasizes Julia Rettig in conclusion. "As described, it is important for us to take the step towards process consulting and thus achieve real added value for our customers. SAP is rarely complicated, but always very complex, which is due to the processes in and around the ERP. There is no solution here that can be implemented within days and with minimal effort. This is in the nature of things, which is why SAP is constantly changing to make it as easy as possible for customers."

To the partner entry: