SAP customers on brink of ERPocalypse as 2025 support cliff looms for ECC
When German vendor promised service until 2027, not everyone qualified
Half of SAP clients relying on ECC – used by the majority of ERP customers – will fail to qualify for extended support beyond 2025, according to the German vendor's own figures.
Released in a slide session during a German-speaking user group conference last month, the data shows that 50 percent of ECC systems will not be in line for the support extension from 2025 to 2027 announced by SAP in 2020. Only ECC instances on "enhancement pack" EHP6 and later qualify for the extension.
To make matters worse, of those on EHP5 and earlier, 40 percent are not aware of the support deadline looming a little more than two years away. Since around 27,000 SAP users rely on ECC to run their organizations, maintenance will stop at the end of 2025 for some 13,500 users.
Jens Gleichmann, managing director of German SAP consultancy Crossload, said most customers on EHP5 and earlier would not upgrade to a later ECC enhancement pack, and instead try to make the leap to S/4HANA, the most recent in-memory system which SAP promises to support until 2040.
"They will do it in one big step because otherwise they have to test twice, but it is a dramatic effort to do such an upgrade," he said. "And not all of them are aware of that, because everyone is talking about this end of maintenance in 2027. Most don't know that it is maybe only 2025."
Gleichmann estimated such a project could take two to two and a half years, meaning for some it would already be too late.
He said most ECC customers were not convinced by SAP's arguments that to innovate and transform their business, they need to be on S/4HANA, preferably in the cloud.
"They are struggling because their business is not looking to upgrade and transform its processes," he said. "They just want to run ERP: most of them don't need big innovations or AI or whatever; they just want to sell their products and services."
Upgrade projects would be made especially difficult because of the history of their systems. "They have grown systems since the 1990s, with a lot of custom code," Gleichmann said. "They are such monsters because most of them do not have the concept of data tiering. When they move such old data into the cloud or into S/4HANA, it will be very expensive."
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Another problem is skills. With so many companies looking to upgrade at the same time, they may find it difficult to recruit the skills needed internally or with partners.
"SAP does not have enough consultants to cover this mass of customers. They will have to rely on partners and they already have good project pipelines for the next two years," Gleichmann warned.
A spokesperson for SAP would not comment on the figures, but said: "SAP has been transparent with our customers, and in February 2020 we announced that we will provide mainstream maintenance for core applications of [ECC] SAP Business Suite 7 software until the end of 2027, followed by optional extended maintenance until the end of 2030."
They added: "This information has been made available on the SAP Support Portal, in our product availability matrix, the respective SAP Support Notes and in a press release and interviews.
"For SAP ERP 6.0 this refers to three latest enhancements packages starting with EHP6 and including newer versions. In October 2014, we announced that systems on EHP5 or earlier product versions will remain in mainstream maintenance until end of 2025 followed by customer-specific maintenance from 2026 onwards. This includes problem solving for known issues at unchanged fees."
Jon Gill, head of sales at SAP and Oracle support company Spinnaker, was not shocked by the number of ECC users facing the support cliff edge. He said the number of apparent S/4HANA users was inflated by companies trialing the product, while running their business-critical systems on ECC.
Those still in the dark about the cliff edge will face some tough choices if they try to remain supported by SAP.
"If you're not aware of the deadline, I would hazard a guess that most CIOs have a plan of work for at least the next 12 months, probably the next 18 months," Gill said.
"Now, if you want to stay in support, you're going to have to put something completely different into that planner for 2024/2025. What's the impact of that on other projects? What's the impact of that on the internal teams? Is it something that's actually going to deliver value? My suggestion would be it's not going to deliver significant value because if there was value in moving enhancement pack level, you'd have done it way before that." ®