If you have a current SAP ERP system, you should already know what’s around the corner: you’re going to have to migrate to S/4HANA prior to the end of the standard support contract in 2027 (or extended support contract in 2030).
While the thought of an ERP system upgrade can seem overwhelming, it is important that you begin your preparations sooner rather than later. Think of your ERP system like a company executive, you wouldn’t want to let them retire without having a transition plan in place years in advance. And since your ERP is a critical part of your business functions, the time is now to begin preparing your transition roadmap.
While that timeframe might feel very far away today, a look at the reality of this conversion makes it clear that there are a lot of benefits to making that conversion now.
Why Upgrade to S/4HANA Now?
There are plenty of articles and blog posts out there explaining what S/4HANA is, and how it’s different than your current system, and telling you the 5 or 6 or 7 or 8 reasons why you should upgrade.
This is not that blog. We know you have to upgrade; you know you have to upgrade, yet you haven’t taken the steps to prepare for the inevitable. So, let’s look at some very practical, non-technology-specific reasons why you’re going to want to get this task on your calendar.
1. It’s a large scale, multi-year project to upgrade or deploy.
Depending upon the complexity of your system, this conversion could take two years or more to accomplish. This is not taking into account the time it will take for critical data preparation and cleansing tasks that should be undertaken for a successful system upgrade. If you wait until 2025 or 2026 to start the process, you might not finish in time and will lose SAP support for your current ERP system, unless you invest in a costly extended support contract with SAP.
2. SAP Ariba consulting partners will be in short supply.
For the next few years, SAP Ariba consulting partners, like CCP Global, will be increasingly in demand to help with this type of project as everyone rushes to upgrade to for that 2027 deadline. If you wait too long, you might not be able to get the expert support you need, or you may end up paying a premium for support or having to settle for a company that may not have the years of experience and expertise you want to guarantee a successful deployment.
3. SAP support will be stretched as the deadline approaches.
There is some level of support required from SAP for these projects because there are certain things on their end that only they can deploy. If everyone waits until 2025 to upgrade, SAP might be stretched so thinly that they might not be able to manage all those projects at once. That could make it very challenging, if not impossible, to get the support from SAP required for the volume of upgrades happening at that time.
Other Reasons to Move Now
Aside from those three timeframe issues that will be inevitable for those who wait too long, there are other legitimate reasons to go ahead and pull the trigger and make the switch to S/4HANA now. Even if you THINK you don’t need the upgraded features of S/4HANA, there are opportunities for general process improvement that may justify the early investment in the technology.
1. Take full advantage of the value proposition of S/4HANA.
S/4HANA offers a lot of value, making it easy to justify the move. But one of the biggest advantages is to those who may not have maintained their current systems with as much regularity as is required to support a clean, updated product. Upgrading to S/4 gives your organization the ability to use this upgrade as an opportunity for general process improvements and master data updates and cleansing.
2. Avoid duplication of efforts.
If you tackle some of those process improvements in your existing system and change the system now, you’ll have to go through that process over again when you migrate to S/4HANA. S/4 is going to be similar to ECC but it’s not identical so there would still be some level of effort required to fit whatever you’re doing in ECC into S/4.
3. Many Ariba features are designed with native integration to S/4.
If you’re already contemplating an integrated Ariba deployment, it’s worth noting that many of the more recently released Ariba features are being designed with native integration to S/4. Upgrading or deploying S/4 instead could make the process simpler.
For example: in the fourth installment in our Pre-Deployment Readiness Series, on the topic of Supplier Management, we detailed some of the requirements for upgrading to SAP Ariba’s Supplier Lifecycle and Performance Management (SLP) software. However, if you’re currently using SAP ECC all of your vendors must be migrated to business partner, if you haven’t already done so. That can be a tedious, time-consuming process that can result in costly, frustrating delays.
However, it’s not a requirement for S/4 because the business partner model is native to S/4HANA, so it can save you a lot of time and hassle.
Getting Ready for the Inevitable
As we said in the beginning, there’s a LOT of information about upgrading to S/4HANA available right now, but one thing everyone agrees on is that this is a move that few companies are equipped to handle without an expert consulting partner.
Making that decision now, rather than in 2 or 3 years when EVERYONE is trying to scramble for the same resources, can make the inevitable a lot easier to deal with.