What is the main task of an IT product company, besides the given; developing pathbreaking products and making a market for it, which did not exist. Maximizing profit would be the next priority as their history shows that there are no limits to their profit and every company wants to join that league. Above and beyond and simultaneously and parallel to it, is to create complete customer dependence, so that the customer can even think of leaving you. Some of the products enmesh you in such a manner, that you are left with no choice. So finally you are tied to the product and its progression (versions / updations) as much as the company itself.
When it comes to an ERP as a product the dependency grows exponentially. In ERP even if you wedded to the market leader, for sure, there are hardly any chances of a divorce. The IT expertise and the work culture of the company revolves around that, how do you take a total break and move on to something different. Though technically it can happen, practically it doesn’t. This scenario is more than true for the SAP users and more so in the backdrop of the S4HANA migration, which is being dictated by SAP as a company and a product owner and in a way you cannot do anything about it.
For people new to the enterprise tech / ERP space, SAP S/4HANA is an integrated, next generation ERP suite built on the SAP HANA in-memory database, designed for real time data processing and advanced analytics. Migration to S4HANA is mandatory for all SAP customers. One headline blares, ‘SAP customers struggle with S4HANA migration.’ This is the reflection of the true state of affairs. The end result is, as per a recent study by Hovarth study, more than 60% of the companies experience deviations in budget, schedule and result quality during S4HANA migration.
SAP has held them hostage. SAP user companies are up against the clock. Migration needs to be completed by 2030 if they buy into SAP’s special three-year reprieve. The standard maintenance end-of-life is at the end of 2027. Companies with even a high level of IT maturity, are finding the journey challenging. Delays in planned go-live dates are the rule rather than the exception. Projects are taking 30% longer than originally planned. Only 8% percent have done on schedule. Of the 200 companies surveyed, only 37% have completed their S4HANA migration, 57% are still in mid-transformation. In 6 out of 10 cases, the planned budget was superseded and in a large number of them significantly. The most tragic part is that of all this, nearly two-thirds (65%) of the companies also identified severe to very severe quality deficiencies after completing the migration.
IS IT A CRASH, OR TORRID TIMES OR A LEAP INTO THE NEXT LEVEL OF ERP TECHNOLOGY, AIMING AT PATH BREAKING DIGITAL TRANSFORMATION?
Sanjay Sahay
Have a nice evening.