In 2027, SAP will end its support for SAP Business Suite 7, which includes SAP ECC 6. For IT teams who have spent years honing their ECC skills and customizing their systems to perfectly fit their business needs, this poses a conundrum. Do they stay on the ECC system they know and trust or do they choose to modernize to SAP’s latest version – SAP S/4HANA? In this series of three posts, we will outline the different options you have, reflecting on the advantages of moving to SAP S/4HANA and providing some first recommendations on how to best prepare for this move.
In 2027, SAP will end its support for SAP Business Suite 7, which includes SAP ECC 6. For IT teams who have spent years honing their ECC skills and customizing their systems to perfectly fit their business needs, this poses a conundrum. Do they stay on the ECC system they know and trust or do they choose to modernize to SAP’s latest version – SAP S/4HANA?
If they stay on ECC they will have the option of extended support until 2030 but will face an increase in premium support and maintenance fees, and they will be delaying the inevitable because at some point they will have to modernize.
However, moving to SAP S/4HANA is not just another simple ECC upgrade; it is an entirely new system built on top of SAP’s own in-memory database HANA. It requires a new set of skills that in-house teams may not have. It also requires a new software license agreement to be negotiated with SAP with the opportunity to convert the existing license agreement. And with many unknowns and the potential risk to mission-critical business systems, it is easy to see why SAP owners are carefully weighing up their options.
But what are those options? Let’s look at the most common approaches taken.
For customers whose ECC system is stable, runs like clockwork and the maintenance and support effort is minimal, moving to SAP S/4HANA may seem like an expensive and risky option, with the potential to cause disruption and downtime. These organizations will need to do a cost analysis of paying for premium ongoing support after 2027, the maintenance workload, and the long-term business requirements that may not be supported with the dated ECC system. If the premium support costs seem preferable to converting to SAP SAP S/4HANA before 2027, then they should remain on ECC as is.
An alternative, future-looking approach would be to keep running on ECC but migrate it to the cloud. This will reduce infrastructure costs, improve agility, and help prepare for S4/HANA down the road. You will still have to pay a premium for ECC support, and you may need licensing guidance on how best to structure this once in the cloud, but it puts you a step further down the path to modernization.
Instead of kicking the problem down the road, savvy IT leaders are using the 2027 deadline as a trigger to explore the business case to move to SAP S/4HANA. While some are choosing to move to SAP S/4HANA while remaining on-premises, an increasing number are combining the move to SAP S/4HANA with a move to the cloud to realize the additional benefits offered by the leading public cloud providers. From scalability and cost optimization to agility and accessing the latest innovations, a cloud-based SAP S/4HANA lays the foundation for a truly digitally transformed business.
But what’s the best way to do this? Do you go all in with a complete transformation, or do you take a staged, incremental approach? Let’s look at the choices:
In many organizations, the SAP environment has grown into a complex beast, with extensive customization and complex coding that is difficult to manage or upgrade and with business processes that may have shifted over time away from best practices. Moving to SAP S/4HANA on cloud is the perfect time to clear the decks and start with a clean slate, getting access to the latest platform and the innovations it enables. Organizations whose businesses have changed and evolved over time and who need to update their business processes will benefit from a greenfield conversion as they can build an ERP system that meets their future business needs, rather than trying to retro fit complex code in a new environment.
The downsides of this option? There’s a hefty upfront cost as everything needs to be redesigned and rebuilt from scratch, even the parts that are currently working well. Companies will also have to plan how they can access their historical data to ensure legal compliance.
In a brownfield conversion, you replicate your ECC in SAP S/4HANA exactly the way it currently is, keeping your existing customizations and adopting some of the new SAP S/4HANA features. This option offers the lowest disruption to the business users but offers minimal business benefits from process improvements. The business process improvements can then be planned to use the more modern and richer platform.
This is a compromise between the two radical greenfield and brownfield options, providing more benefits from the conversion than the brownfield approach, without the sheer scale and associated costs and risks of greenfield. It also enables some of the new advanced SAP S/4HANA features to be used from the start, which could otherwise be difficult to implement after the initial go-live.
In this scenario, the use of Selective Data Transition (SDT) tools can accelerate the data conversion from the old ECC system to the new SAP S/4HANA setup, to support the transformation in scope and its impact on the data in both source and target systems. Subsequent waves of transformation can be added over time in a more agile fashion, with less disruption on the business and faster time to value.
For many, this choice is seen as a good balance, achieving a degree of modernization without re-inventing the wheel, and re-starting from scratch; the increased agility also better aligns with the demands of the business and the ever-changing external conditions in which businesses operate nowadays.
For some organizations, elements in their ECC may no longer be stable enough to run business-critical systems and are harder to maintain. You may be shopping around for a different solution to solve your specific problem.
You could reduce the scope of SAP to a core back-office function, swapping out elements of the solution with other SaaS products. For example, you could move the sales part of your ERP system to Salesforce, or the HR component to SuccessFactors or even Workday. Alternatively, you could move away from SAP entirely and select another ERP solution.
The challenge here is that if you move to a new ERP solution, you still need to rebuild from scratch, much the same way you would if you converted to a greenfield S/4HANA solution, and if you keep ECC as the core, you will still face the same premium support costs and challenges around maintenance. It should be noted that even using a reduced portion of the ECC system, organizations may not be able to reduce their maintenance costs because they typically have to pay for the software they bought, not what they use. SoftwareONE’s licensing teams can help negotiate this on a customer’s behalf.
For some organizations, elements in their ECC may no longer be stable enough to run business-critical systems and are harder to maintain. You may be shopping around for a different solution to solve your specific problem.
You could reduce the scope of SAP to a core back-office function, swapping out elements of the solution with other SaaS products. For example, you could move the sales part of your ERP system to Salesforce, or the HR component to SuccessFactors or even Workday. Alternatively, you could move away from SAP entirely and select another ERP solution.
The challenge here is that if you move to a new ERP solution, you still need to rebuild from scratch, much the same way you would if you converted to a greenfield S/4HANA solution, and if you keep ECC as the core, you will still face the same premium support costs and challenges around maintenance. It should be noted that even using a reduced portion of the ECC system, organizations may not be able to reduce their maintenance costs because they typically have to pay for the software they bought, not what they use. SoftwareOne’s licensing teams can help negotiate this on a customer’s behalf.
Now that you understand what the end of ECC means to your business and what your three options are, let’s move on to discover the value of upgrading your ECC to SAP SAP S/4HANA.
Now that you understand what the end of ECC means to your business and what your three options are, let’s move on to discover the value of upgrading your ECC to SAP SAP S/4HANA.
