With SAP’s announcement of ending the support for its ECC customer base, the need for creating a comprehensive transition plan to S/4HANA has never been more important, as the migration to S/4HANA is a large and complex task that affects the core of your business. A task that potentially takes years to complete. With the objective in mind, T-Systems has commissioned IDC to conduct a market research study that investigates how far Nordic companies are in the SAP transformation journey anno 2022. 400 companies have participated in the survey, which reveals that most companies will fail to achieve the ROI with their modernization projects.
The market research shows that 70% of Nordic companies work on modernizing their SAP landscapes. The study also reveals there are great expectations to the modernizing projects will result in cost savings. 60% of the asked respondents in IT management expects the work will lead to savings, but only 11% have achieved so.
However, SAP modernization projects are in an increasing pace driven by improving the business’ ability to innovate and create better products and services. Therefore, the modernization must be perceived and treated as a transformation of the business, which is a continuous process.
The lack of acknowledging SAP modernization as a business transformation is also depicted in how companies measure the success of their SAP projects. Most companies reply they only use IT-operational related KPIs. That is why the typical achieved outcome of their SAP transformation is related to enhanced performance, stability, and security. Typical IT objectives. The study reveals only four out of ten companies use a mix of IT and business related KPIs.
This is critical. The cost saving potential only provides the foundation for 10% - 20% of the total return on investment. The ROI must be secured through business process optimization and re-thinking. Therefore, is it essential that companies apply a mix of IT and business related KPIs to measure the success of their SAP transformation.