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Multi-ERP systems are on the menu for SAP implementations

Organisations using SAP may build future ERP systems from composable building blocks from multiple software providers

Organisations using SAP are seriously considering a multi-ERP (enterprise resource planning) strategy, according to new research from independent UK ERP consultancy Resulting IT.

The research, based on a survey of 150 respondents who attended the UK and Ireland SAP User Group Connect Conference in November 2021 and a Resulting-hosted Future of ERP live research event in January 2022, reported that only 4% of respondents plan to continue running a single monolithic ERP.

The study found that a large majority of respondents rely on SAP as their core ERP platform – 22% use S/4 Hana while three-quarters of those running SAP are still on the ageing ECC platform. According to Resulting IT, almost two-thirds of the people (64%) predict a more balanced approach with a large ERP system covering most business processes. This is then augmented with best-of-breed add-on products.

The research found that the remaining 32% consider that their future ERP system will either be composed of multiple process-specific ERP products and add-ons, or will be entirely composed of best-of-breed enterprise software and custom-built applications.

Resulting IT said the study shows that those who have made the move to S/4 Hana recognise that the future is more composable than those running ECC who have yet to make the move. Almost three-quarters (72%) of ECC respondents expect a “large ERP core”, whereas only 18% of live S/4 Hana respondents feel the same way. Conversely, 36% of S/4 Hana respondents expect an ERP future that is “highly composable”.

In 2020, SAP extended support for its ERP system until 2030, in an attempt to encourage more existing ECC customers to migrate to the newer S/4 Hana platform.

According to Resulting IT’s research, the uptake of S/4 Hana has been lower and slower than SAP would have liked. It estimated that SAP has sold 18,800 S/4 Hana licences, but the installed based of ECC customers is 48,000.

Given that the new S/4 Hana licences include both new customers and existing ECC customers, Resulting IT said: “We estimate this equates to just 22.9% of ECC customers. And bear in mind this is just purchased licences – it doesn’t mean these people have actually migrated and are using an S/4 Hana system today. Live S/4 estimates stand at less than 11,000.”

Derek Prior, non-executive director at Resulting IT, added: “To keep pace with their enterprise’s fast-moving business strategy, a composable architecture is inevitable for all S/4 customers – so it is vital that they understand all of their options. And some of those options are highly likely to include solutions from alternative vendors.”

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