CIOs are smart, they must be, to keep their jobs in the accelerating world of digital everything. So, in our previous discussion, it was no surprise to discover that they are cautious in their appraisal of SAP’s next generation ERP solution: SAP Business Suite 4 SAP HANA, or S/4HANA.
SAP claims that S/4HANA (S4) is one of its fastest selling products ever. From SAP’s point of view this is true, they have sold over 6,000 copies since its launch in February 2015. But only about 1,000 are live systems today, because the CIO needs a solid business case, the right resources and proof that S4 is as reliable as their existing SAP ERP solution. Once all of these three conditions are proven, S4 will start to really take off from the customers point of view, with multiple thousands of live S4 systems purring away. Until then, many of the S4 licenses sold will remain as “shelf-ware”, waiting for implementation.
2017 is the year for S4 early adopter customers. In my opinion, S4 will start to really take off for mainstream customers in 2018. By next year there is likely to be some large S4 systems out there that have gone live and seriously stress-tested the on-premise edition of S4. This will give CIOs that vital proof of S4 product reliability.
Early adopter customers of S4 on-premise in 2017 have been net new customers of SAP, business administration systems to run SAP partner businesses, plus some early migrations of installed base traditional SAP ERP customers. In 2018 these migrations will greatly accelerate for the reasons above.
Today, the core S4 product is on its third major release: 1610 FPS 02 for the on-premise edition and 1708 for the much newer Software-as-a-Service (SaaS) public cloud editions. With each new release SAP adds new much-needed functionality in the vital logistics and industry solution modules. Many installed base customers are waiting for some of these new product capabilities. SAP has become much better at publishing roadmaps for its entire product range, it needed to. For S4 SAP published a very detailed three-year roadmap in October 2016 to guide customers and partners on these new capabilities.
But, be careful! SAP developers often change their product roadmaps (without telling customers) to keep pace with fast-moving markets. SAP also provides good solution documentation for S4.
This is all very well, but interpreting these vendor roadmaps and translating them into a meaningful customer project roadmap can be daunting. In theory, SAP and partners can help. But to make the job easier SAP announced a brand-new planning tool at SAPPHIRENOW this year called the SAP Transformation Navigator, which automatically collects all SAP software version data from actual customer landscape systems. Therefore, the tools does need a customer login to access it, but a full demonstration version is planned soon.
At the end of the day any early adopter customer implementing S4 today should share their own customer project roadmap with the S4 product owners within SAP to avoid surprises and secure executive commitment within SAP.
So, back to our original question: when will S4 really take off, for customers? My money is on 2018.
Agree or disagree, send us your thoughts to firstname.lastname@example.org.
Author Dr. Derek Prior spent 19 years as an analyst specialising in SAP at Gartner and AMR Research, advising organisations all around the world on SAP strategy and best practices.