As we talk with customers running legacy SAP ERP, the reasons they give for not making the move to S/4HANA vary. Some think it’s “not mature enough,” while others believe there is still plenty of time before the projected ECC end of life in 2025. Others tell us they’re focused on fixing near-term issues in the existing environment and are concerned that direct conversion to S/4HANA will perpetuate or worsen those issues.
But one of the biggest reasons given for not moving to S/4HANA at this time is that it simply is not in the budget. The current capital plan may only provide budget to do an enhancement pack upgrade, based on a common misconception that it’s required before converting to S/4HANA.
Don’t assume you need to do an enhancement pack upgrade.
From case studies we’ve done with clients, we’ve found that the effort and cost to go straight to S/4HANA vs. an enhancement pack upgrade is not that different.
Our data compares the impact of doing a service pack vs. an ECC 6.0 EHP upgrade vs. an S/4HANA conversion in terms of effort, downtime, project duration, cost and several other factors. I’ll share a few subsets of that data, based on a complete “lift and shift” implementation:
- Project timeline: there’s a perception that an S/4HANA conversion is a much bigger effort than an enhancement pack upgrade, but our data shows that with an extra four weeks in the timeline, you could skip the EPH8 upgrade completely and move directly into S/4HANA.
- Downtime impacts: in our customer examples, EHP8 required three production outages (48/24/48 hours) vs. only one 48-hour outage for S/4HANA. In addition, EHP8 required two periods of freeze (14 weeks total) vs. one 22-week freeze for S/4HANA.
- Cost: the high-level cost estimate for an EHP8 upgrade vs. S/4HANA conversion was not significantly higher, so if you have already budgeted for EHP8 it might make sense to move directly to S/4HANA if you can find incremental budget to apply.
As mentioned, the data above represents a complete “lift and shift” implementation, activating only essential new S/4HANA functionality and keeping change management at a minimum. The goal would be to get your business on the new platform so that you’ll have better tools to fix inherent issues you’ve been facing with existing systems and have access to modern-day services that are not available in SAP ECC 6.0.
When you’re ready, you’ll also have access to additional new functionality that you can implement when it makes sense for your business.
It’s Time to Think Differently
If you’re still thinking an upgrade to SAP Suite on HANA (SoH) or any enhancement pack is the best move for your business, our advice is to STOP for a moment and consider the data from actual customer cases before making a final decision.
And consider this: if you do an enhancement pack upgrade now, your move to S/4HANA will likely be delayed by another 3-4 years – and that pushes you against the SAP ceiling of 2025. As we outlined in a previous blog, there are a lot of good reasons why you should not wait.
However, if you upgrade to S/4HANA in 2020, you would have four years on that platform before you would need to cycle again. And that means cost savings as well as positioning your business for the future.
Your Next Steps
We invite you to download our expert brief, Why Enhancement Pack Upgrades Should Be a Thing of the Past, for a more in-depth discussion. And – if you want to walk through a more detailed analysis or get a formal estimate of what it would take to move your business to S/4HANA – let us know.