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Summary

A humbler and more empathetic SAP was on display at this year's SAP Sapphire customer conference in Orlando. The vendor went out of its way to convey three major themes: we feel your pain when it comes to your challenges and issues; we need to do a better job conveying the business value of S/4HANA; and partners – in particular major service provider partners – will play a critical role in future S/4HANA roadmapping, implementation, and support. For the many SAP customers struggling to build a business case to invest in S/4HANA (which can be an expensive proposition), it was exactly what they needed to hear.

Making the business case for S/4HANA through services

It was hard to miss the unifying message delivered throughout the week-long Sapphire conference, starting with CEO Bill McDermott's opening keynote and repeated often by SAP executives: we empathize with our customers and we want to help move them to S/4HANA as a "Digital Core" to enable transformation. Embedded in that message was a tacit acknowledgement that SAP in the past has done a lukewarm job in providing a S/4HANA business case that was compelling enough for some customers to move off of current systems to a newer, pricier platform – even one that includes improved features, better integration, cloud-enablement, and analytics. In his keynote, McDermott guaranteed that those days were over, and that SAP would leverage its own combined services and support group – recently renamed Digital Business Services – as well as its partners to demonstrate how S/4HANA can be a critical enabler of digital transformation.

On that latter point, SAP also unveiled new branding for recently announced packaged S/4HANA planning and implementation services for a program called Value Assurance. The program is meant to engage customers at different points of a digital transformation-S/4HANA project, depending on where the customer needs it, to lay out a clear S/4HANA roadmap and implementation plan based around business outcomes. There are four levels, each building on the other (with pricing that starts at €210K at the lowest level and increases with each additional level): planning and safeguarding; technical implementation; migration and functional implementation, and innovation and optimization. What's more, seven major services providers have committed to delivering Value Assurance, working in conjunction with SAP's services group: Accenture, Capgemini, Deloitte, EY, IBM, PwC, and Wipro.

Customers at Sapphire said they genuinely want to hear S/4HANA business cases and were appreciative of SAP's message, even as they take it with a dose of healthy skepticism. SAP's intentions seem genuine, as the company has reached a critical point where it needs greater S/4HANA adoption to fully execute on its "Digital Core" strategy. Partners engaging in Value Assurance, meanwhile, said that while S/4 implementation is still an open question for many customers, requests to engage in S/4 roadmapping and planning are ticking up. The impact of SAP's empathetic approach, combined with the efforts of its services group and ecosystem, will become clearer in the second half of the year – especially as we see whether increased customer interest in S/4 roadmapping materializes into actual planned implementations later on.

Appendix

Further reading

SWOT Assessment: SAP Cloud for Customer and SAP CRM, IT0020-000190 (April 2016)

"SAP partners with Apple in a bid to revolutionize work on iOS devices," IT0021-000169 (May 2016)

Author

John Madden, Practice Leader, IT Services

john.madden@ovum.com

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