To keep up with ever-growing market demands, react to new competitors and realise innovative business models enabled by new technologies, businesses need modern IT systems, but that also means expectations and the operating of ERP systems is becoming more complex and time-consuming. This impacts the hardware, but also analysis and process needs, and the integration of a growing number of data (sources) and applications.
On top of this is the fact that nearly all software vendors, including SAP, act with a planned obsolescence, or rather an intended artificial shortening of a product’s lifecycle. For software, this ageing processes can be fairly specifically defined through maintenance periods. In the case of SAP, R/3 (SAP ECC, Business Suite 7) has just six years left before support is discontinued at the end of 2027.
Many SAP customers are still using R/3, but to remain flexible into the future and still be able to work securely, it doesn’t make sense to invest in “outdated” systems. In the SAP world, the next level is S/4 HANA. Launched in 2015, SAP S/4 HANA was designed as a platform for the digital transformation and is consistently optimised. SAP S/4 HANA succeeds SAP R/3 and is based on the in-memory database HANA that offers better performance particularly when it comes to dynamic real-time evaluations. With SAP S/4 HANA, users can simplify their IT landscape, conduct processes in real-time and operate their business model in a cloud and on-premise environment.
However, moving to a new ERP system isn’t something that can happen overnight. Planning and design require a lot of time and should be started in good time. There are currently four factors that suggest the time for seizing the initiative is right now:
Cooperations in particular are behind the growing demand for S/4 HANA as SAP customers are making the move to the cloud. Each of the three hyperscalers offer differing (proprietary) ways into the cloud with SAP, complementing, expanding and enhancing established deployment models. This means that decision makers just getting started with their cloud planning and determining where cloud-based SAP workloads make the most strategic sense have gained new opportunities, and SAP admins already using S/4 HANA are even more flexible.
Choosing a hyperscaler users can leverage the services they already procure from the provider to innovate and gain an advantage. For example, By running their SAP solutions on Azure, customers can seamlessly use SAP data and apps with Microsoft Teams Office apps in Microsoft 365 to enhance collaboration and user-friendliness. The same is true for AWS and Google. Other benefits can be enjoyed by combining varying platforms within the scope of a multi-cloud strategy.
According to an SAP Insider study carried out in 2020, of those SAP admins who choose to integrate a hyperscaler into their strategy, just shy of 50% choose Azure, while approx. 20% each leverage AWS and Google. At the end of the day, it is scalability, flexibility, availability, security and cost-effectiveness that attract decision makers to choosing the cloud when switching to an intelligent ERP system and lead them to select a particular hyperscaler. And for good reason as when you combine all the benefits, businesses are in a position to react quickly to the fast-paced markets, model them and profit from digitalisation.
Decisive factors for running SAP S/4 HANA in a hyperscaler’s cloud or for choosing a hyperscaler as a central operating model tend to be the desire and need for future security, coupled with the highest level of security and reliable operations. And all this as a tailored concept against the backdrop of ever-changing requirements.
In addition to creating the right individual mix of on-premises and cloud solutions, i.e. the optimised distribution of SAP workloads and data, the migration to new ERP systems such as S/4 HANA needs qualified service providers who cover the following four service areas: