In Charles Dickens A Christmas Carol, the main character Scrooge is visited by three ghosts who teach him valuable lessons about his past, present and future showing him how he can overcome various flaws to build a better future for himself. In the spirit of the season, this two-part article will detail how the SAP ecosystem has overcome issues in the past and present. It will also speculate about where the SAP ecosystem might go in the future and what lessons from the past it must take into consideration.
SAP was founded in 1972, by five former IBM employees who aimed to create a standard enterprise resource planning (ERP) solution in order to process business information in real-time. Its first financial accounting software was released the following year, named R/1 with its successor R/2 coming out around 1979. Responding to demand from their clients R/2 was compatible with a number of languages and currencies allowing SAP to expand their international reach.
In the 1990s R/3 further expanded upon the capabilities of its predecessors in allowing the previously scattered human resources, financial and manufacturing software packages from a wide range of suppliers into one all-encompassing solution. The long term benefits were obvious for businesses in terms of cost and efficiency,only dealing with one supplier. The issue was that actually implementing R/3 was time-consuming and costly for businesses, with many reluctant to make the change. This was a common issue throughout the early history of computing, in fact, the Space Shuttle program in the 1980s was still running on computing processes from 20 years before.
What needed to change was the actual tactics of implementation itself, historically implementations could be a highly haphazard affair. By the 1990s and the turn of the Millennium, however, project management was going through a renaissance. Both Scrum and Agile methodologies were emerging during this period, allowing more options for businesses to implement the R/3 solution. The evolution of project management, markedly turned the tide as more businesses reaped the benefits.
At present SAP is encouraging its clients to move from the SAP ECC solution to the intelligent enterprise S/4HANA, with SAP giving a deadline of originally 2025 and a lee-way of around three years,before support for ECC is cut off. As we detailed in the lessons of SAP’s past, upgrading to newer ERP solutions is costly and time-consuming, meaning business leaders get cold feet about upgrading. However, the issue is no longer one of not having as many project management methodology options. Instead one of the biggest issues is the talent gap in SAP professionals.
Recent research from Ensono, a UK based IT consultancy, shows that 74% of UK IT leaders have postponed their SAP implementations due to a lack of relevant skills. This huge figure goes to show how badly trained SAP professionals are needed in the ecosystem. The solution to the problem is two-fold, with the rise of IT freelancers, especially in the latter part of the 2010s flexible teams can be quickly assembled at a lower cost for businesses while providing the specialist skills they need. Meanwhile, SAP education partners, such as K2 University, allow organizations to rapidly upskill their own employees to meet the demand. In the coming years these two factors will allow businesses to alleviate their worries and hopefully by 2030 the move to S/4HANA will be complete.
In part 2 we will examine what the future holds for the SAP ecosystem and what the next great challenge will be.
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