The S/4 and Cloud Disaster

Nevertheless, it is a fact - even if Walldorf does not react to it: S/4 Hana and cloud computing are largely irrelevant in the German-speaking part of the SAP community.

When asked how DSAG members dealt with the topic of S/4 Hana in their companies, more than half of the 357 respondents answered with a symbolic "no" (see pie chart).

The weighting and positioning of S/4 Hana is therefore predominantly negative. The situation is similar in terms of strategic relevance (see bar chart). While 70 percent of respondents consider the classic SAP Business Suite 7 (S/7) to be highly strategic, 80 percent say that S/4 Hana in the cloud is only of low relevance for their company.

These survey results are a double slap in the face for SAP: on the one hand, cloud computing from Walldorf is being mercilessly punished, and on the other hand, S/4 is not yet trusted too much. When asked about the strategic relevance of S/4 as an on-premise solution, a third of the 357 respondents answered high, medium and low.

Rejection of the cloud as a strategic ERP solution is therefore one result of the DSAG survey presented at the 2015 annual congress. However, the respondents have a very clear idea of the classic business suite as the strategic ERP backbone in the company. Cloud solutions, on the other hand, fall into the lower single-digit range.

"DSAG members have built up a great deal of expertise in the area of Business Suite and trust it to map their processes efficiently and as completely as possible, both today and in the future. Despite innovative products, the future security of the Business Suite must remain in place".

is the demand on the part of DSAG.

This means that existing SAP products must also support companies' digitization strategies and be able to be expanded or further developed to this end.

With S/4 Hana, SAP has positioned itself to demonstrate solutions for the digitalization of business processes. The picture among DSAG members is currently still divided:

Around 37 percent of those surveyed do not see the added business value, and around 11 percent have not yet engaged with S/4. On the other hand, 6.2 percent have started a project. 4 percent of companies have purchased licenses.

Around 37 percent are currently in the process of gathering information (see pie chart). What DSAG members currently need in order to better weigh up the use of S/4 is concrete information on which functions the solution covers. For 72 percent of respondents, this is the most important decision criterion.

"The success of an ERP for customers will be determined by functionality. It is the key for digitization projects".

explains the DSAG chairman Marco Lenck a substantial result of the reality check.

"SAP currently does not provide enough of this information."

Furthermore, according to the DSAG survey, there is a lack of concrete statements on the business benefits, the license model and information on the requirements for companies to migrate to S/4 Hana. For these reasons, there is a certain reluctance and skepticism among members.

In Switzerland, the picture is more differentiated: S/4 Hana is becoming an increasingly important topic. The number of companies that are already working intensively with S/4 is now significantly higher than the number of those that have not yet recognized any added value for themselves.

The strategic relevance of SAP solutions such as Hana On-Premise, On-Demand or HEC (Hana Enterprise Cloud) is also rated significantly higher by Swiss companies than by the entire DSAG member base.

Christian Zumbach, DSAG board member for Switzerland, comments:

"This confirms a trend that has already emerged in recent years, namely that IT innovations are accepted and adopted more quickly in Switzerland than in Germany or Austria."

According to Wolfgang Honold, Hana also currently enjoys a higher status among Austrian DSAG members compared to the DACH region.

"However, this cannot hide the fact that, despite all the innovation, the further development of the SAP solution for human resources within SAP ERP or S/4, for example, is of essential importance for Austrian companies"

says the DSAG board member for Austria.

Replacing SAP Human Capital Management with SuccessFactors would only be conceivable if smooth integration is guaranteed and the country-specific requirements are implemented in payroll accounting.

The digital transformation is gaining ground among the member companies of the German-speaking SAP User Group: 15 percent of those surveyed are actively implementing projects to digitize business processes.

Almost one in three companies is evaluating topics such as the Internet of Things (IoT) and Industry 4.0. The other half of the survey participants are still cautious and do not yet see a need.

DSAG Chairman Marco Lenck expects a further push on this topic in the coming months:

"In many industries, adapting business models to the market can be a decisive competitive factor. It is therefore important to implement business process requirements quickly, flexibly and as simply as possible."

SAP can and should provide the possibilities, both with new and existing solutions. The survey was conducted in summer 2015. IT managers and company representatives from DSAG member companies were surveyed.

A total of 357 user companies from Germany, Austria and Switzerland from all sectors and company sizes took part. One person per member company was surveyed.