Enterprise adoption of SAP S/4HANA continues to climb despite the obstacles in its way, according to new research by user groups in the US and Europe. Adopters are being drawn by advanced capabilities in the new software, and driven by concerns about maintenance of older systems.

In the UK and Ireland, 89% of SAP customers are either using or planning to use S/4HANA, up from 74% in 2021, according to a survey conducted for the UK & Ireland SAP User Group (UKISUG).

“With everything else that’s been going on this year, I think that’s quite a big move,” said UKISUG chairman Paul Cooper, pointing to the distractions CIOs faced with the pandemic and ongoing supply chain problems.

The biggest driver for the move to S/4HANA, cited by 70% of survey respondents, is SAP’s plan to end maintenance support for its ECC 6 and Business Suite 7 software in December 2027.

But according to Cooper, other drivers include a desire for new functionality (49%), accompanying a wider business transformation (47%), improving productivity (41%) or simplifying business processes (38%).

Those UKISUG members with no plans to adopt S/4HANA aren’t necessarily playing chicken with SAP over maintenance support, he added: they could be planning a switch to another ERP, or have no plans for anything more than a year out given current economic difficulties.

In the US, the proportion of SAP customers using or planning to use S/4HANA remained stable at 78%, although the proportion now live on the platform rose to 31% from 28% in 2021, according to a survey conducted for the Americas’ SAP Users’ Group (ASUG).

Awareness and adoption of the Rise with SAP all-in-one package of licensing, hosting and application management is also on the up. ASUG’s survey found that 38% of respondents were familiar with Rise, compared to 23% in 2021, and only 20% had never heard of it, down from 39%. UKISUG found that 28% of those who had heard of Rise used it or planned to do so, seeing it as a way to accelerate their move to S/4HANA and the cloud.

The switch to S/4HANA is showing up in SAP’s sales figures too — S/4HANA revenue for the third quarter of 2022 was up 98% year on year to €548 million — but there are still obstacles to wider adoption, the user groups found.

Skills shortage still a concern

Training provided by implementation partner was rated as poor or very poor by 32% of organizations surveyed by UKISUG (down from 34% in 2021), while 36% rated technical resources provided by SAP as insufficient (down from 38%). Little wonder, then, that organizations yet to move to S/4HANA are more concerned than ever that a lack of available skills will slow their migration, with 92% citing it as a problem, compared to 71% a year earlier.

UKISUG plans to do something about the skills shortage next year, launching its own S/4 Academy to help organizations manage their migrations. This will complement the deep-dive technical training that SAP offers, not compete with it, Cooper said: “We’re pitching this as the sort of practical and pragmatic things that you need to know and understand, as opposed to how to configure something in SAP.”

ASUG members also cite skills shortages as the biggest barrier to innovation, especially in a multi-cloud environment, with one-fifth seeking to optimize their cloud innovations by upskilling existing staff with help from free learning platforms and business partners.

Customization challenges

Existing software customizations still pose a challenge for 72% of organizations moving to S/4HANA, UKISUG found, down from 92% in 2021, although this change of attitude may be because more respondents are resigning themselves to doing away with customizations altogether. That’s the case for 24% of organizations, up from 12% a year earlier.

Integrations also proved challenging for 64% of those who already made the move to S/4HANA, with just 28% of them relying on SAP’s own Business Technology Platform for help with integration. Little wonder that numerous market research organizations forecast that the integration-platform-as-a-service market will grow at over 30% annually over the next few years.

Grounds for optimism

Recent forecasts from the likes of IDC and Gartner put growth in IT spending at around 5.1% in 2023 despite broader belt-tightening and despondency about the economic environment.

After comparing notes with numerous CIOs at UKISUG’s recent annual conference, Cooper was similarly optimistic about the prospects for IT departments in the year ahead.

“Your gut feeling, based on the front pages of the newspapers, would be that people would be slashing [IT budgets], but there still seems to be very robust investment and plans to grow and develop their IT systems,” with the uptake of S/4HANA being just one sign of that, he said.

SAP

If you have a dev-centric background, you must have heard about the term DevOps. Before DevOps was called DevOps, the two disciplines (“Dev” and “Ops”) were growing further apart. Developers (the “Dev” part of the story) have had a desire for agility since the turn of the century, following the publication of the famous Manifesto for Agile Development. Meanwhile, Operations (the “Ops” part) formalized good practices into frameworks such as ITIL, which were implemented by most large companies in the mid-2000s.

Those two approaches seemed to oppose. While Agile advocates the acceleration and multiplication of changes, ITIL tends to limit and control them. However, DevOps flourished as a combination of both methodologies and concepts, while organizations strived to accelerate the launch of innovative services and applications. Moreover, DevOps has led to increased proactivity through systematic automation and continuous monitoring which enables faster issue detection and resolution.

Now that a third player is entering the mix with NetDevOps, what can we expect from it? Network operations manage what many perceive to be a complex, fragile environment. Network teams are fearful of delivering the level of agility required by new digital initiatives, because of potential network disruptions. As a result, the risk arises of another “wall of confusion” caused by a conflicting combination of motivations, processes, and tools.

NetDevOps aims to extend agility

However, “Net,” “Dev,” and “Ops” are likely to converge on many aspects. Networking technology trends have followed the same path as data center trends. Programmable, software-defined, and cloud-based network environments have made NetDevOps a reality through the use of infrastructure-as-code and automation.

According to industry analysts, NetDevOps is among the most hyped innovations in networking. Successful NetDevOps initiatives would look like fully automated environments that can deploy and test configuration changes across networks, ready to be consumed in a DevOps approach all along the CI/CD pipeline.

There’s a catch though. NetDevOps remains an emerging transformational process. Most adopters still lack adequate tooling, such as continuous monitoring. This makes it difficult to understand how the software-defined infrastructure is performing in test, staging, and production conditions. NetDevOps teams are then faced with significant challenges in getting continuous feedback for validating or improving their delivery processes. The challenges include:

Understanding the user experience before and after infrastructure changes are pushed and pinpointing issues early before they have an impact.Diving back into the history of changes, and determining the impact on the infrastructure throughput and the digital experience.Forecasting possible bottlenecks owing to configuration changes and variations in the traffic patterns.

Most modern software-defined network platforms provide a reasonable level of integrated monitoring features. However, network operations are running short of options when seeking the root cause of user experience degradation, especially when multiple ISPs and network device vendors are involved. In order to continuously validate the user experience delivered by their software-defined networks, organizations need real-time analytics capabilities to gain insights into the end-to-end digital experience, traffic management complexities, and device configuration.

As organizations are pressured to increase the agility of network operations processes, traditional monitoring practices can be a roadblock to successful NetDevOps adoption. Without pre- and post-change validation of the end-user experience, risk-averse network teams will be wary of managing a larger volume of changes more quickly with the potential risk to production infrastructure.

In the very near future, approaches such as NetDevOps will become mainstream; agile network teams will have to guarantee reliable connections and consistent digital experience on a continuous basis. Now is therefore the time to review your network monitoring strategies, and evolve traditional NetOps into Experience-Driven NetOps.

You can learn more about how to tackle the challenges of agile networks in this new white paper, Continuous, End-to-End Validation of SD-WAN Performance from the End User Perspective. Read now and discover how organizations can deliver reliable connections that are experience-proven.

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