June 20, 2019
Rimini Street survey finds majority of SAP Business Suite 7 customers have no plans to transition to new package
Channelnomics Staff
Germany-based software giant SAP sees a future in which its applications and platforms power the cloud-connected, Internet of Things (IoT) enabled world. However, if a survey conducted by software support provider Rimini Street is correct, SAP faces a big hurdle as the majority of its current business suite license holders have no plans to upgrade to S/4HANA when current packages come to their planned end of life.
The Lowdown: S/4HANA, launched in 2015, is the successor to Business Suite 7 that’s purpose-built for the HANA framework. S/4HANA contains many of the same business management tools, including enterprise resource planning (ERP), customer relationship management (CRM), product lifecycle management (PLM), and other analytics and finance management applications.
The survey conducted by Rimini Street, a provider of alternative enterprise software maintenance and support services, found that 35% of customers currently running SAP Business Suite 7 have no plans to upgrade when SAP discontinues the software package in five years. Another 32% of survey participants say they’re undecided about adopting S/4HANA as a replacement.
The Details: The transition from Business Suite 7, which SAP stopped selling in 2018, is not trivial. S/4HANA has a completely different code base and requires significant upgrades in database and hardware infrastructure. Even the cloud version requires significant investments in migration and customization. The cost and difficulty of migration, plus the sunk cost of existing investments in current platforms, is causing an eye-popping 80% of SAP Business Suite 7 users to say they plan to continue running at least some workloads beyond the 2025 end-of-support date.
In the survey, only 5% of users said the fees and other expenses of SAP’s software support are worth the return in value. Users complained that SAP lacks knowledge or the ability to address unique and specific needs of customers, takes too long to resolve issues, and doesn’t deliver on promised innovations. The survey participants said this leads to customers undertaking “self-support” with their SAP implementations.
The Impact: The results of the Rimini Street survey are not good for SAP. The data reflects apathy and dissatisfaction among SAP Business Suite 7 users, and indicates SAP and its partners face an uphill battle in expanding S/4HANA adoption and market share.
The source of the survey, however, is also a contributing factor, as negative results are in Rimini Street’s interest. Rimini Street sells less expensive software support to customers of SAP, Oracle, and Salesforce. Having data that indicates dissatisfaction and points to users willing to work with a third-party to take their software beyond end-of-support is good news for Rimini Street.
The Buzz: “With SAP’s expensive, time-consuming, and resource-intensive forced migration to their S/4HANA product, SAP 4.x and ECC licensees have two choices: Stay on SAP’s vendor-dictated roadmap and continue to invest in undesired, forced upgrades, or choose a business-driven roadmap designed specifically around their business objectives,” said Rimini Street CEO Seth A. Ravin.
Counterpoint: Assuming the Rimini Street data reflects the SAP Business Suite 7 user experience and intention, the survey results could potentially lead to good news for SAP and its channel partners. The data indicates that SAP customers need the expert guidance and support of channel partners to make the efficient move from legacy to next-generation systems.
Even if the Rimini Street data is true today, it’s unlikely businesses will remain apathetic over the next five years. As the end-of-support date gets closer, Business Suite 7 users will take harder looks at their options. Declining options and the need for upgrades to new capabilities will likely create more opportunities for SAP and its channel partners over the next 5 years.
Related Links:
SAP: Support Strategy Center
Computer Business Review: Is SAP’s 2025 Deadline Real?
