Major reasons why quite a few industrial companies in germany have decided not to move in to the sap cloud with s4 hana
Many industrial companies in Germany have been hesitant to move to SAP S/4HANA Cloud for several key reasons:
1. High Migration Costs
- The transition from SAP ECC to S/4HANA Cloud is expensive, requiring significant investments in new hardware, licenses, consulting, and training.
2. Customization and Flexibility Issues
- Many German industrial companies have highly customized SAP ECC systems. Moving to the cloud often means losing or redeveloping these customizations, which can be costly and time-consuming.
3. Data Security and Compliance Concerns
- Strict German and EU regulations (e.g., GDPR) make companies cautious about storing sensitive business data in the cloud, especially when using public cloud solutions managed by SAP.
4. Lack of Full Feature Parity
- Some businesses find that the cloud version of S/4HANA does not yet support all industry-specific functionalities that they rely on in their existing on-premise SAP systems.
5. Operational Disruptions
- The migration process is complex and can lead to downtime or disruptions in critical business operations, making companies hesitant to make the switch.
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6. Uncertain ROI and Business Case Justification
- Companies struggle to see immediate cost savings or operational benefits that justify the high initial investment and effort.
7. Concerns Over Vendor Lock-in
- Moving to the SAP Cloud means a stronger dependence on SAP’s infrastructure and pricing model, reducing flexibility to switch providers in the future.
8. Limited IT Resources and Expertise
- Many companies lack the in-house expertise to manage the transition and are wary of relying too heavily on external consultants.
9. Integration Challenges
- Industrial firms often have complex IT landscapes with legacy systems and third-party applications that may not integrate seamlessly with S/4HANA Cloud.
10. Skepticism Towards SAP’s Cloud Strategy
- Some businesses are not fully convinced of SAP’s long-term commitment to the cloud model and worry about future changes in pricing, service levels, or support.
Would you like insights into how some German companies are successfully managing this transition despite these concerns?
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Exec Enterprise Digital-transformation Advisory - EU EntArch (EA-portfolio : BTaaS, Pgm, CoE, MFG) SME
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Igniting Innovation - Wettbewerbsvorteile die skalieren durch individuelle Softwarel?sungen
1 个月Migrating to SAP S/4HANA Cloud presents several challenges for industrial companies, making the transition complex and costly. One of the biggest struggles is high migration costs, including licensing, consulting, and training expenses. Many businesses also face difficulties due to customization limitations, as their highly tailored SAP ECC systems may not be fully compatible with the cloud version, requiring costly redevelopment.