Be prepared: Organizations running SAP must make big changes soon

by Michael Wordell, Product Manager, ERP Application Solutions, Rackspace Technology

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In four years, organizations running SAP ERP components will need to make big changes in how they use their technology. This is a relatively short amount of time, so it's important to begin planning now.

  • By the end of 2027, SAP will end support for its SAP ERP 6 EHP (6-8). For organizations running SAP ERP 6 EHP (0-5), support ends by 2025. (OSS 2881788). To remain supported, customers will need to migrate their SAP ERP databases to SAP HANA database before then.
  • Database vendors such as Microsoft and Oracle may have different EOL dates for their existing SAP supported databases. Customers need to be aware of when those support agreements run out for SAP, and how they may affect their SAP environments.
  • Support ends December 31, 2027. To avoid interruption, plan to migrate your SAP ERP databases to SAP HANA, and you will be supported until December 31, 2027.

The risks of using technologies beyond EOL

When a technology reaches the end of its life (EOL), customers who haven’t upgraded will experience a wide range of failures if they continue its use, any of which can increase costs and diminish customer experiences. Specific challenges include:

  • Disruptions: EOL systems are prone to performance issues and breakdowns. Most companies can’t afford the resulting business disruptions and operational delays.
  • Maintenance costs: Frequent breakdowns lead to increased maintenance costs.
  • Expensive support: Post-EOL support is usually more expensive and hard to find.
  • Security vulnerabilities: Unsupported systems are highly vulnerable to security attacks.
  • Compliance failures: Non-compliance with government and industry regulations can result in hefty fines, penalties and damage to your brand if you cause harm to your customers.

Start your transition now

Despite the four-year heads-up, organizations shouldn’t wait to transition to S/4HANA for a couple of reasons. First, most organizations will need to undergo some degree of data modernization over the course of their transition. Second, as we get closer and closer to the deadline, the demand for access to SAP and cloud conversion support teams will increase significantly. Resources will be finite, and this could lead to slowdowns or even downtime.

As of May 2022, only 24% of SAP customers had made the transition. At the same time, nearly a quarter of impacted organizations (23%) had not created a HANA migration plan yet.

“Delaying the conversion can lead to significant setbacks for companies that depend on SAP to meet their business goals every day,” said Judy Jamison, Director of Enterprise Resource Planning Services at Rackspace Technology®. “Depending on the size of an organization and other factors, this type of conversion can take years to accomplish, including assessing your current situation, creating a conversion roadmap and executing the conversion.”

A successful transition requires substantial technical, functional and business engagement and assessment, and can take several years to implement. The assessment phase will include planning, blueprinting and integrating current processes. These tasks will be followed by an expensive implementation, during which the legacy ERP system remains behind the curve, unable to take advantage of in-memory computing, analytics, SAP Fiori applications and cloud infrastructure.

It’s important to remember that there are incremental approaches to this upgrade as well. For instance, companies can plan an enhancement pack upgrade to SAP ERP 6 EHP and above and a migration to SAP HANA while planning a larger S/4HANA migration/upgrade. Customers running on AnyDB can negotiate a deal with SAP to switch their database licensing to HANA, rather than dealing with database vendors by 2025.

As companies plan a larger transformation effort to S/4HANA, an increasingly popular option is to change the underlying database on the existing SAP ECC code base. If an enhancement pack upgrade is required, this can be combined with a database migration into a single project for increased efficiency.

Stay ahead of the curve

Switching the database to SAP HANA completes a key technical component of the S/4HANA transformation process for brownfield upgrades. Also, by moving the system to more powerful hardware, you can accelerate the overall upgrade process.

When it comes to SAP, there are significant advantages for making the conversion to S/4HANA sooner rather than later. Not only will your organization be prepared well ahead of the deadline, but you’ll also start benefitting from its advanced capabilities sooner.

As more organizations adopt S/4HANA, they are thrilled to find that it:

  • Eliminates the architecture limitations of SAP ECC
  • Allows them to leverage newer technologies via its digital core
  • Provides the ability to establish a standardized, more simplistic platform for standalone businesses
  • Supports improved integration, communication and reporting
  • Streamlines processes into new workflows that leverage the latest technologies
  • Reverts complex customizations to standard functionality
  • Reduces or eliminates costs for maintaining customizations
  • Supports future SAP upgrades as SAP has committed to supporting S/4HANA until 2040

According to the Redhat SAP S/4HANA Migration Benchmark Report 2022, organizations that have already completed their migration to S/4HANA reported the following primary motivators:

  • 36% cited the opportunity to re-engineer processes to better fit their operational needs, or to correct poor processes and configurations from a previous ERP implementation
  • 32% cited the end of maintenance and support for core SAP ERP releases
  • 32% cited pressure to digitally transform existing ERP solutions to create a harmonized and centralized model and structure

Choose the right strategy and support

Companies have the option to choose how and where to modernize their SAP solutions and data, based on factors such as their complexity, operational profile and enterprise goals. You also have a broad range of cloud platforms, including Rackspace Private Cloud and all major hyperscale public cloud providers, from which to choose.

Rackspace Technology's experience, SAP partnership and operations certifications, coupled with our cloud specializations, will provide you with a modernization, migration and optimization roadmap that meets your business goals in both private and public clouds.

Let our experts help you get the most out of your investments

We’ll help you define your SAP requirements, optimize your cloud costs and maximize the efficiency of your processes. Our SAP Optimization Assessment typically takes one week and includes joint workshops to identify challenges and strategies related to your SAP ECC or SAP S/4HANA applications and cloud environments. We will then provide you with a detailed findings summary report. Contact us today to learn more.

Get started with your SAP Optimization Assessment today