The Most Important SAP S/4HANA Trends That You Need to Know [Grow, RISE, AI, 2027 Deadline, etc.]
Summary
TLDRIn this insightful discussion, Eric Kimberling, CEO of Third Stage Consulting, outlines key trends in the SAP ecosystem, particularly focusing on the S4/HANA implementation. He introduces SAP's 'Grow' and 'RISE' initiatives targeting small to large enterprises for easier S4/HANA adoption. Kimberling also highlights SAP's AI advancements, the importance of integration in their expanding tech stack, and the challenges of tech talent shortages. He raises questions about the future of big system integrators and the realistic approach to SAP's 2027 migration deadline, offering a comprehensive guide for successful S4/HANA implementations and inviting viewers to engage for further insights.
Takeaways
- 😀 Eric Kimberling is the CEO of Third Stage Consulting, an independent consulting firm specializing in digital transformation.
- 🌟 Third Stage Consulting is technology-agnostic and helps clients with digital strategy, software evaluation, and implementation.
- 📈 SAP is focusing on two major initiatives, 'Grow' and 'Rise', to encourage adoption of S4/HANA among small to large enterprises.
- 🛠️ 'Grow' is a program aimed at small and mid-market companies, offering pre-configured technologies to implement S4/HANA with lower cost and risk.
- 🚀 'Rise' targets existing SAP customers, encouraging them to migrate from legacy systems to S4/HANA, especially moving from on-premise to the cloud.
- 🧠 SAP is emphasizing AI with the creation of a Chief AI Officer role, leveraging vast customer data for AI advantages in their product suite.
- 💡 Innovation at SAP includes acquisitions of third-party ERP and enterprise technology providers, expanding their capabilities and offerings.
- 🔄 Integration and interoperability are key as SAP's strategy includes both in-house developed and acquired technologies, requiring seamless system collaboration.
- 🔑 There is a notable skills shortage in the SAP space, particularly for S4/HANA expertise, impacting the implementation capacity and quality.
- 🤔 The role of big system integrators in the S4/HANA ecosystem may be challenged by skills shortage, AI advancements, and customer distrust due to forced migrations.
- ⏰ The 2027 deadline for SAP customers to migrate from ECC/R3 to S4/HANA is unlikely to be met by many, raising questions about SAP's support strategy post-deadline.
Q & A
Who is Eric Kimberling and what is his role in the SAP ecosystem?
-Eric Kimberling is the CEO of Third Stage Consulting, an independent consulting firm that assists clients globally in achieving digital transformation success. His company is not affiliated with SAP but frequently helps clients with their SAP implementations, including S/4 HANA.
What is the purpose of Third Stage Consulting's guide to successful S/4 HANA implementations?
-The guide is designed to provide best practices, lessons, and tips to enhance the success of an S/4 HANA implementation. It includes insights and advice from clients who have recently undergone the implementation process.
What are the two major initiatives SAP has introduced to encourage the adoption of S/4 HANA?
-SAP has introduced 'Grow' and 'Rise'. 'Grow' targets small to mid-sized companies, offering preconfigured technologies tailored to different industries to implement S/4 HANA at a lower cost, risk, and time. 'Rise' is aimed at existing SAP customers, encouraging larger organizations to migrate to S/4 HANA and move from on-premise to the cloud.
How is SAP leveraging artificial intelligence in its strategy?
-SAP is focusing on AI as a spearhead of its innovation efforts. They have created a new position, Chief AI Officer, and are integrating AI capabilities into S/4 HANA and their product suite. SAP's large customer base and the data they generate provide an AI advantage for the company.
What role do SAP's acquisitions play in their innovation strategy?
-SAP's acquisitions of companies like Ariba, SuccessFactors, Concur, and Business Objects have broadened their technological competencies and driven innovation. These acquisitions have allowed SAP to offer a more comprehensive suite of enterprise technologies.
Why is integration and interoperability becoming a key focus in the SAP space?
-With the shift in strategy to acquire external software vendors, SAP and its customers now need to focus on how to effectively integrate these systems. This is crucial for the successful implementation of S/4 HANA alongside other SAP-acquired systems.
What is the impact of the tech talent shortage on SAP projects?
-The tech talent shortage, especially for SAP consultants well-versed in S/4 HANA, can lead to challenges in resourcing and finding skilled professionals for implementation projects. This shortage may affect project timelines and the quality of implementation.
What challenges might large system integrators face in the S/4 HANA ecosystem?
-Large system integrators may face challenges due to the tech talent shortage, the potential impact of AI on their revenue streams by automating software development and customization, and distrust from customers due to the forced migration to S/4 HANA.
What is the significance of the 2027 deadline for SAP customers migrating from ECC or R/3 to S/4 HANA?
-The 2027 deadline is significant as it marks the point by which SAP expects customers to migrate to S/4 HANA. However, it is acknowledged that many organizations may not meet this deadline due to various constraints, potentially leading to a large subset of SAP customers missing it.
What could be the implications for SAP customers who miss the 2027 migration deadline?
-The implications for customers missing the 2027 deadline are uncertain. SAP may extend the timeline, cut off support and maintenance for legacy products, or find other solutions to encourage or facilitate the migration to S/4 HANA.
How can interested parties access more information about Third Stage Consulting and its resources?
-Interested parties can access more information about Third Stage Consulting and its resources by scanning the provided QR code, which leads to a video describing the company in detail, or by visiting the links included in the video description.
Outlines
📈 SAP S/4 HANA Implementation Trends
Eric Kimberling, CEO of Third Stage Consulting, discusses the trends to be aware of in the SAP ecosystem for those considering an SAP S/4 HANA implementation. Kimberling emphasizes the importance of understanding the current landscape, including SAP's 'Grow' and 'Rise' initiatives, which aim to facilitate adoption of S/4 HANA by small to midsize companies and existing SAP customers, respectively. He also mentions the availability of resources such as a guide to successful S/4 HANA implementations and invites viewers to engage with Third Stage Consulting for further insights and assistance.
🤖 SAP's Focus on AI and Innovation
The script highlights SAP's strategic emphasis on artificial intelligence and innovation within the S/4 HANA platform. With the creation of a new position, Chief AI Officer, SAP is leveraging the vast amount of data from its large enterprise customer base to enhance AI capabilities. Additionally, the company's acquisition of third-party ERP and enterprise technology providers like Ariba, SuccessFactors, Concur, and Business Objects is driving innovation and expanding SAP's competencies. The trend also touches on the importance of integration and interoperability as SAP's strategy shifts from in-house developed software to incorporating acquired technologies.
🔧 Addressing the SAP Skills Shortage and Implementation Challenges
The script addresses the current skills shortage in the SAP market, particularly for S/4 HANA expertise, which is a new skill set distinct from traditional SAP technologies like ECC or R/3. The demand for SAP consultants is high due to a low unemployment rate and a surge in S/4 HANA implementation projects. Furthermore, the script raises concerns about the dominance of large system integrators in the S/4 HANA ecosystem and questions whether their influence will wane due to factors like AI automation and customer distrust stemming from the forced migration to S/4 HANA. Lastly, it acknowledges the inevitability of many customers missing the 2027 deadline for migrating to S/4 HANA, suggesting potential repercussions and adjustments by SAP.
Mindmap
Keywords
💡SAP S4 Implementation
💡Digital Transformation
💡Technology Agnostic
💡SAP S/4HANA
💡Grow Program
💡Rise Program
💡Artificial Intelligence (AI)
💡Integration and Interoperability
💡Skills Shortage
💡System Integrators
💡2027 Deadline
Highlights
Trends in the SAP ecosystem are crucial for those considering an SAP S/4 HANA implementation.
Eric Kimberling, CEO of Third Stage Consulting, discusses the importance of being aware of current SAP trends.
Third Stage Consulting is an independent firm aiding clients in digital transformation, including SAP implementations.
The 'Grow' initiative targets small to mid-market companies, offering preconfigured technologies for easier S/4 HANA adoption.
The 'RISE' program encourages existing SAP customers to migrate to S/4 HANA, especially promoting cloud adoption.
SAP is focusing on artificial intelligence, appointing a Chief AI Officer and integrating AI into their product suite.
Innovation at SAP includes acquisitions of third-party ERP and enterprise technology providers.
Integration and interoperability are key as SAP's strategy involves both in-house and acquired technologies.
A tech talent shortage in the SAP space is impacting the availability of skilled consultants for S/4 HANA.
The role of big system integrators in the S/4 HANA ecosystem may change due to skill shortages and AI advancements.
Small to mid-market system integrators might gain traction as they can offer more personalized service.
Many SAP customers are likely to miss the 2027 deadline for migrating from ECC to S/4 HANA.
SAP's strategy to migrate customers to a common S/4 HANA platform may face challenges due to unrealistic timeframes.
Third Stage Consulting offers a guide to successful S/4 HANA implementations, sharing lessons and advice.
Eric Kimberling encourages reaching out for informal brainstorming sessions regarding S/4 HANA implementation planning.
Transcripts
if you're considering embarking on an
sap S4 implementation there's a number
of Trends to be aware of in the sap
ecosystem what exactly are the trends
you need to be aware of that's what I
want to talk about here
today my name is Eric Kimberling I'm the
CEO of third stage Consulting we're an
independent consulting firm that helps
clients throughout the world reach their
third stage of digital transformation
success and many of our clients are
implementing s4a many of our clients are
considering sap as an option for their
implementations and even though we're
technology agnostic we're not affiliated
with sap as a company we commonly will
help clients through their sap
implementations and help them plan for
it help them evaluate the options and
one of the things we come across are a
number of different trends that are
relevant in the sap World a lot of
nomenclature and things to be aware of
so what I want to do today is dive into
some of the trends that you should be
aware of as you potentially embark on an
S4 Hana implementation now if you're
looking for more S4 Hana best practices
and lessons and tips to make your
project more successful I encourage you
to read our guide to successful s4a
implementations it's packed with
information and lessons and advice on
how to make your s4hana implementation
more successful and we also share a
number of lessons from our clients that
have recently gone through Ashana
implementations you can read that guide
for free by scanning the QR code here in
front of you or you can go to the links
below before we dive too far into
today's content I want to invite you to
learn a little bit more about third
stage Consulting who we are and what we
do I've included a link to a video right
here that describes third stage and a
bit more detail talks about our story
our history our philosophy our clients
our service offerings and that sort of
thing but in general what third stage
Consulting does is we're an independent
and Tech agnostic Consulting provider we
help clients through their entire
digital transformation life cycles
beginning with digital strategy software
evaluation and selection all the way
through and including implementation
planning impl ation Readiness in the
actual implementation itself we're
technology agnostic so we only represent
our clients's best interest we do not
represent software vendors but having
said that we work very closely with
software vendors all the leading players
that you can imagine we've worked with
both in helping clients evaluate and
select them but also in helping clients
Implement those Solutions as well so we
have a very broad objective agnostic
view of the market that is meant to
really represent your interest as you go
through your digital transformation I
also encourage you to scan this QR code
right here to get access to our Resource
Center this Resource Center has a ton of
information ton of ebooks that are free
you have access to top 10 software
rankings playbooks for how to make your
project more successful guides to change
management YouTube videos all kinds of
stuff that are going to help you through
your digital transformation so I
encourage you to scan this QR code to
get access to those resources and please
feel free to reach out to me directly to
brainstorm ideas about your project even
if it's just informally you want to
bounce around some ideas and get some
informal advice I'd be happy to spend
some time with you so feel free to reach
out to me I've included my contact
information below you can also find it
in the description field of this video
as
well the first Trend to be aware of in
the sap space is grow and Rise these are
two initiatives that sap has recently
rolled out to really help more people
adopt the s4a platform in the s4a
technology now these are probably two of
the biggest initiatives that sap is
working on now and it's really a way for
organizations that are either smaller
midsize companies or existing sap
customers to more easily adopt s4hana
Technologies let's start with grow grow
is the program that sap has recently
introduced that's focused on the small
and mid market and the idea here is they
wanted to create an enticing reason an
enticing program to get more of these
small ad midmarket companies to feel
more comfortable with us fora and what
grow is is essentially a set of
preconfigured technologies that are
tailored to different industries that
are specific for small and midsize
companies the whole premise or the whole
hypothesis here is that by following the
grow program small ad mid Market
companies can Implement s4hana at a
lower cost lower risk and in less time
than if they didn't have the grow
program now the jury is still out on
whether or not this will work if this
will help more mid-market companies go
with the S4 platform but we'll see over
time how that works but in the meantime
we know that sap is focused very heavily
on grow similarly rise is a similar kind
of a program but it's actually tailored
or designed for existing sap customers
and larger sap customers the idea being
here that they want to give these larger
organizations that have already been
using sap such as ECC or R3 two of the
Legacy products that sap has had for a
long time they're trying to give those
customers a good reason to move over to
S4 Hana now and so rise is a way to
really promote that adoption it's also
designed for existing S4 customers that
might have implemented an on premise
version of S4 Hana The Rise program is
intended to give them an incentive to
move from on premise to the cloud which
is where ultimately sap wants all their
customers to be is on the cloud so these
two programs are two Trends to be aware
of as you embark on an sap project here
in 2024 and
Beyond sap is really leading the charge
with their artificial intelligence and
overall Innovation initiatives and if
you think about it and back up for a
moment if you look at sap customers sap
customers are historically very large
Enterprises that have lots of data and
not only that but sap has a lot of
customers tens of thousands of customers
so if you think about all that data that
these customers have it really lends
itself to sap having an AI advantage in
that there's a lot of data for the AI
algorithm to work with so artificial
intelligence is something that sap is
very much focused on in fact they've
recently announced that they've created
a new position within sap called the
chief AI officer and so they're really
leading the charge and not only talking
about AI not only building some AI
capabilities in des4 Hana and their
overall product Suite but they've
actually created an organization that's
focused on AI so I think sap has a
definite Advantage here with their AI
initiatives and not only that but
they're also really driving innovation
in a lot of different ways Beyond AI but
really AI is sort of the spearhead of
their Innovation efforts at the moment
some other Innovations sap is pursuing
is in their acquisition of other
third-party Erp and Enterprise
technology providers and I'm going to
come back to this point in a moment but
sap has acquired a lot of Fairly
significant and large systems such as
arba on the procurement side of things
success factors which is an HR
technology concur which is a time and
expense reporting software business
objects there's a lot of different
technologies that sap has acquired over
the years and that's really driving a
lot of the Innovation and the a lot of
increase ing competencies that sap has
at the moment so watch for AI and
Innovation to be really a key
Centerstone of Sap's growth strategy in
the
future integration and interoperability
is another theme or another Trend to
watch for in the sap space the reason
this is so important is because
historically sap has had Legacy products
that were really built from the ground
up for the most part for example you go
back to R3 or even ECC and most of that
technology was built by sap and fully
integrated within the sap platform
however over the years their strategy
has shifted a bit where as they rolled
out S4 Hana and as they were working on
S4 Hana even before it was introduced to
the market they started acquiring other
companies that focus on different parts
of Enterprise Technologies so whereas
sap had always historically had their
own in-house developed software now
they've gone out to the market to
acquire software vendors such as success
factors concur arba business objects Etc
so what that means for sap customers and
sap ecosystem is that now you need to
focus more on integration and
interoperability how do you get all
these systems to work in other words
it's not just about rolling out and
introducing S4 Hana to your organization
chances are it's S4 Hana plus success
factors or Reba or concur one of the
other many systems that sap has acquired
over the years so for that initiative to
be successful sap and sap customers are
going to have to focus more on
integration and interoperability of
multiple systems and for that reason
it's not as simple as rolling out one
technology so watch for this to be
another common Trend and emerging Trend
in the sap
[Music]
space I recently published a video on my
YouTube channel that talks about the
massive Tech Talent shortage you can
find that video right here by the way
and that Tech Talent shortage is
relevant to sap sap has a lot of Demand
right now for sap consultants and people
that know S4 really well and just a
sumarize why this is such a problem
right now first of all unemployment
throughout the world is low in in many
parts of the world you also have a spike
in demand for S4 Honda implementations
right now largely because sap is putting
a deadline of 20127 for existing sap
customers to move to S4 so when you have
a shortage that are existed and then you
add to the fact that now you're creating
more demand for implementations you can
see how there wouldn't be enough skills
to go around and so that's a trend to be
aware of is that there is a skills
shortage in the sap space especially
because people that were well versed in
R3 and ECC and some of the older sap
Technologies don't necessarily translate
into knowing S4 Hana so s4a is a new
skill set S4 Hana is constantly evolving
and changing and so there's just not a
lot of people that have acquired deep
competencies in s4a as may have been the
case with ECC or R3 so all this stuff
adds up to a trend of skill shortages so
you just need to be aware of that as
you're planning for an implementation
and know that things may not go as
planned in terms of resourcing and
finding those outside skills and
[Music]
competencies another Trend to watch that
I'm actually positioning more as a
question not so much as a definitive
trend is whether or not the big system
integrators will continue to dominate
the S4 Hana ecosystem as they may have
in the past in the past big SI like deoy
Accenture PWC Etc really controlled the
market for S4 implementation services
not only the skill shortage that I
talked about a moment ago but you also
have a lot of smaller to midsize sap
system integrators that oftentimes can
provide better service more attention
and just better quality than some of the
big system integrators also I think
another challenge that that the big
system integrators are going to have in
the near future is with the Advent of
artificial intelligence I think that's
going to cut into a big part of their
revenue stream which used to involve a
lot of offshoring of software
development and software customization
so in other words people can start to
use AI instead of paying humans to code
the software to configure the software
to create the Integrations the reports
and all that stuff there's a certain
amount that can be automated with AI so
because that's such a big part of the
big system integrators revenue streams I
think that could be a challenge as well
and then the the next big thing I'll
talk about that I think is a challenge
for the big system integrators is the
fact that they are complicit in this
whole forced migration of Legacy sap
customers to S4 Hana and it's creating a
large amount and large degree of
distrust among the big system
integrators now it's also creating a lot
of distrust with sap as a vendor but the
reality is is that sap customers are
more likely to stay with sap and they're
probably going to move forward with sap
S4 because they have to but with the
system integrators people at least have
a choice they can go a different
direction if they have that distrust so
I would watch for the trends in market
share and the trends with some of the
smaller mid-market sorts of system
integrators to see how they might get
some Traction in the space as
well now the final Trend I'll talk about
here today is the fact that it is
inevitable that customers will miss the
2027 deadline not all of them maybe not
even majority of them but a large subset
of sap customers will miss the deadline
to migrate from eccr R3 over to S4 Hana
now the reason for this is because many
organizations just simply aren't in a
position to go through a big
implementation at the moment maybe they
don't have the time the budget the
resources the risk tolerance or whatever
the case may be and the other Factor
here is that even if they want to and
they haven't started yet it's going to
take many organizations longer than 2027
to fully roll out s4hana and to move off
of ECC and R3 so for that reason it's
inevitable that you're going to have a
large customer base of sap that misses
that 2027 deadline so then the question
becomes what's going to happen to those
customers will sap really cut off
support and maintenance for those Legacy
products will they extend the timeline I
don't know that there's a good answer
for sap there because they really do
want people to get over to the common
s4a platform so they can invest all of
their R&D in that platform and not have
to worry too much about ECC and R3 and
they could ultimately Sunset those older
products so I understand why sap wants
customers to move over but I think
they're doing it in a compressed time
frame that isn't realistic for a lot of
larger organizations so for that reason
let's watch and see what happens with
the potential Fallout from customers
missing that 2027 deadline so I hope
this has giving you some things to think
about as you look to the sap ecosystem
to understand what some of the trends
are to learn more about sap
implementations in general and other sap
Trends I encourage you to read our guide
to successful S4 Hana implementations
it's a guide that covers tons of
information around the strengths and
weaknesses of sap how to be more
successful in your implementation some
of the lessons learned from helping so
many of our clients through their
implementation so I encourage you to
read that you can scan the QR code here
to read it or you can go to the links
below and of course if you'd like to
brainstorm ideas even if just informally
related to your s4a implementation or
the planning for your S4 implementation
I encourage you to reach out I've
included my contact information below
myself and my company are Tech agnostic
and independent so we're not affiliated
with sap however we do have a lot of
experience implementing sap products so
we can give you sort of the honest truth
of what it might take to be successful
in your initiative so I hope you found
this information useful and hope you
have a great
day there's a number of Trends to be
aware of in
the adapt ah gosh let need to start that
whole sentence over so these two
programs are two Trends to watch out so
these two
Trend wow thank you I recently published
video on my YouTube channel that talks
about the
mess
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