SAP users: Cloud is becoming more popular, fairness required for on-premises

SAP's cloud applications are becoming increasingly attractive for local users, as the results of this year's investment report from the German-speaking SAP user group (DSAG) suggest. According to the report, the usage figures for S/4Hana Cloud show significant growth. According to the report, 33 percent of respondents in the DACH region (2024: 11 percent) now rely on the private cloud offering and thirteen percent (2024: 6 percent) on the public cloud variant.

The gap to the discontinued model of traditional ERP program packages (51%) narrowed significantly year-on-year. Furthermore, for the first time, more cloud than on-premises S/4Hana systems are being used in companies.

In terms of investment, cloud ERP systems are also literally taking off. 68 percent (2024: 18 percent) state that they want to invest in S/4Hana Cloud (private and public). In other words, more money will continue to be spent on the cloud versions of the ERP package than on the on-premises counterpart. Meanwhile, 38 percent of respondents in the DACH region also gave a positive assessment of SAP's cloud ERP policy, compared to the disastrous thirteen percent from the previous year.

Survey with other addressees

At the presentation of the report, DSAG CEO Jens Hungershausen pointed out, however, that the current results are only comparable with those of the previous year to a limited extent. This is because the questionnaire for the participants was sent out by SAP this time. As a result, significantly more larger companies were surveyed. On the other hand, the target group was also more heterogeneous, as one in five of the participating SAP user companies is not a DSAG member.

According to Hungershausen, the trend reversal towards the cloud must therefore be read against the background of the changed survey structure. "It is often large companies whose digital transformation strategy is a reason to migrate to the cloud," says the user representative. At the same time, they usually also have greater investment power. In addition, some of the marketing and sales initiatives to support SAP's cloud policy, such as the Rise with SAP Migration & Modernization programme, had not yet "taken off" last year. The program, which includes incentives for moving to the cloud, was rated as highly or moderately relevant by 40 percent of respondents.

Approval for SAP's transformation programs

The Rise with SAP (private cloud) transformation program has also become significantly more important. 48% of respondents (2024: 16%) stated that they already use or intend to use the program. The number of companies not planning to use Rise fell from 61% to 23% within the space of a year. Grow with SAP, i.e. the transformation to S/4Hana Public Cloud, is also experiencing slightly weaker growth in importance.

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In view of the acceptance and popularity of Rise with SAP and Rise with SAP Migration and Modernization, DSAG sees this as confirmation that on-premises customers should not be left out in the cold. Nevertheless, Hungershausen complains that some user companies feel under pressure from SAP to move to the cloud.

"The pace that the software manufacturer is setting here is not sustainable for every company. SAP must not pressure its customers to make quick decisions for the sake of its own share price," said the DSAG board member. "Instead, SAP must ensure that companies have a realistic, economically viable and strategically sensible migration perspective. Freedom of choice, long-term planning security and fair conditions for on-premises customers are still needed."

(mki)