In the sum­mer of 2019, ASUG board mem­ber and John­sonville CIO Ron Gilson came to the ASUG research team with an idea. He told us about Johnsonville’s expe­ri­ence when attempt­ing to upgrade from SAP S/4HANA 1610 to 1809 and the bar­ri­ers it faced due to miss­ing cer­ti­fi­ca­tions on crit­i­cal third-par­ty solu­tions the com­pa­ny had been run­ning with its ERP system. 

A Poten­tial Risk for SAP S/4HANA Customers
It’s impor­tant to note that John­sonville was a very ear­ly adopter of SAP S/4HANA. The com­pa­ny began its jour­ney in 2016 and was the first North Amer­i­can cus­tomer to suc­cess­ful­ly go live with a brown­field migra­tion from SAP ECC 6.0 to SAP S/4HANA (1610). We won­dered whether this would even­tu­al­ly start to come up as an issue as more cus­tomers adopt SAP S/4HANA and reach their first upgrade cycle. 

At ASUG, we knew we were in a unique posi­tion to gath­er per­spec­tives from not only live SAP S/4HANA cus­tomers, but from third-par­ty solu­tion providers and from SAP itself. So, we kicked off a study in the sum­mer of 2019 to find out whether this was, in fact, a poten­tial risk for SAP S/4HANA cus­tomers and what might be behind it. 

Who’s Respon­si­ble for SAP S/4HANA Certification?

As we start­ed to explore this top­ic, we found that no one seemed to agree about who should be respon­si­ble for SAP S/4HANA cer­ti­fi­ca­tions for third-par­ty solu­tions to sup­port smooth upgrades for SAP cus­tomers. Frankly, we saw a lot of fin­ger point­ing and not many clear answers. 

To get dif­fer­ent per­spec­tives on this issue, we invit­ed three dif­fer­ent groups of ASUG mem­bers to take our sur­vey: SAP cus­tomers who were seri­ous­ly con­sid­er­ing adopt­ing SAP S/4HANA, live SAP S/4HANA cus­tomers, and mem­bers at SAP part­ner orga­ni­za­tions that work with SAP S/4HANA and pur­sue cer­ti­fi­ca­tions with SAP. For those who were con­sid­er­ing SAP S/4HANA, we required that they had already pur­chased or were cur­rent­ly imple­ment­ing SAP S/4HANA. What we dis­cov­ered in our research led to three eye-open­ing findings. 

Find­ing 1: Future Cus­tomers Need to Get Edu­cat­ed on SAP S/4HANA Certifications

The major­i­ty of the par­tic­i­pants (67%) who are plan­ning to adopt SAP S/4HANA are also plan­ning to bring their third-par­ty solu­tions along for the jour­ney. These are the solu­tions that cus­tomers have already eval­u­at­ed, imple­ment­ed, and inte­grat­ed with their key busi­ness processes. 

Yet a full 41% of those par­tic­i­pants were unaware of the cer­ti­fi­ca­tion sta­tus of the third-par­ty soft­ware they will car­ry over. And, unfor­tu­nate­ly, the remain­ing 59% who are aware of this issue do not have a sol­id strat­e­gy in place to ver­i­fy that their third-par­ty solu­tion providers are cer­ti­fied on the release they’re plan­ning to adopt. 

The top two tac­tics par­tic­i­pants told us they’re plan­ning to use if they find out a third-par­ty solu­tion isn’t cer­ti­fied is to ask about the provider’s plan and only inves­ti­gate if they don’t get a sat­is­fac­to­ry answer (a response for 51% of cus­tomers) or to push the provider to cer­ti­fy (as 30% responded). 

Build a Plan B into Your Migra­tion Road Map
As a wise per­son once said, hope is not a strat­e­gy. Giv­en that cus­tomers are sim­ply hop­ing for the best out­comes with their providers, we believe it’s impor­tant for future adopters of SAP S/4HANA to do an audit of the third-par­ty solu­tions they plan to car­ry over as ear­ly as pos­si­ble in their migra­tion plan­ning. Reac­tive­ly pres­sur­ing their third-par­ty part­ners to make a change is an approach that may not suc­ceed, despite the qual­i­ty of the rela­tion­ship. Bet­ter to have a plan in place to cov­er the crit­i­cal func­tion­al­i­ty you’ll need once you migrate to your new ERP sys­tem or to choose to move to anoth­er release based on your partner’s exist­ing certifications.

Find­ing 2: Cur­rent SAP S/4HANA Cus­tomers and Solu­tion Providers Do Not Align on Certification

While future SAP S/4HANA adopters had low aware­ness of this cer­ti­fi­ca­tion issue, cur­rent cus­tomers were much more in tune with this poten­tial hur­dle. A full 61% of those who were already live told us they knew that unique part­ner soft­ware cer­ti­fi­ca­tion exists for each ver­sion of SAP S/4HANA (ver­sus only 37% of future cus­tomers). Near­ly half (48%) of cur­rent cus­tomers had expe­ri­enced a set­back with their part­ners dur­ing migra­tion and 1 in 3 expe­ri­enced set­backs specif­i­cal­ly relat­ed to SAP S/4HANA certifications.

No Crys­tal Ball for Adop­tion
We also learned that more than half (54%) of third-par­ty providers are attempt­ing to get cer­ti­fied on every release of SAP S/4HANA, though cur­rent cus­tomers have already skipped ver­sions in their upgrade strat­e­gy (13%) and a full 42% of cus­tomers plan to skip them in the future. Solu­tion providers — espe­cial­ly the small­er com­pa­nies — must make dif­fi­cult deci­sions about which release to cer­ti­fy for, yet they have no view into which of these their cus­tomers will adopt. 

While cur­rent cus­tomers (who are like­ly in a sim­i­lar sit­u­a­tion as John­sonville) told us their num­ber one chal­lenge is with their part­ners’ inabil­i­ty to keep up with cer­ti­fi­ca­tions, those third-par­ty providers told us they were fac­ing steep chal­lenges, too. On aver­age, they said they are spend­ing about $75,000 per year to pur­sue these SAP certifications. 

Cer­ti­fi­ca­tion a Long and Opaque Process
Part­ners also told us their num­ber one chal­lenge with the process is that it takes too long and is too com­pli­cat­ed, plus they have lit­tle to no insight into how the code changes in the new release will affect their solu­tions. The major­i­ty of cus­tomers (39%) expect that the cer­ti­fi­ca­tion process should take their part­ners one to three months, when in real­i­ty it requires three to five months for at least a third of part­ners who par­tic­i­pat­ed in our study (34%). This means it’s tak­ing near­ly half a year for some to cer­ti­fy on a pre­vi­ous year’s release, when a new release will come into the pic­ture just a few months lat­er. As Ron Gilson has said, that means cus­tomers will be forced to take a N‑1 approach to their solu­tion road maps so they are con­sis­tent­ly behind the upgrade cycle. 

Find­ing 3: There Is No Vil­lain in the SAP S/4HANA Cer­ti­fi­ca­tion Story

Though we saw clear dis­con­nects between cus­tomers, part­ners, and SAP — we did not dis­cov­er any rea­son for fin­ger point­ing. There are no vil­lains in this sto­ry, but we did find that SAP has the poten­tial to be a hero. 

When SAP guid­ed cur­rent SAP S/4HANA cus­tomers through their migra­tion process and made them aware of the cer­ti­fi­ca­tion issue, they were able to plan around it. These cus­tomers told us they believe that SAP should be heav­i­ly involved in the cer­ti­fi­ca­tion strat­e­gy of third-par­ty providers, active­ly work­ing to keep providers up to date with cer­ti­fi­ca­tions on every release cycle. Cur­rent cus­tomers feel that SAP has a key role to play and do not see cer­ti­fi­ca­tion as strict­ly a part­ner issue.

SAP S/4HANA Buy­ers Be Aware
Future cus­tomers can take the ini­tia­tive to con­sult with SAP as they’re devel­op­ing their migra­tion road maps. Today, only about 1 in 5 future cus­tomers are ask­ing SAP for assis­tance when select­ing third-par­ty soft­ware solu­tions. Of those who are talk­ing about this top­ic, most said that soft­ware cer­ti­fi­ca­tion came up when SAP made them aware of its impor­tance. Only 1 in 5 cus­tomers isn’t enough, in our opin­ion. We believe there’s an oppor­tu­ni­ty for SAP to play a key role in edu­cat­ing future cus­tomers about soft­ware cer­ti­fi­ca­tion, and for cus­tomers to active­ly ask for help in this area. Cus­tomers should advo­cate for them­selves when it comes to this topic. 

Pos­si­bil­i­ties for Third-Par­ty Solu­tion Providers
Mean­while, part­ners are ask­ing for SAP’s help, too. If recer­ti­fi­ca­tion on each new ver­sion was required, the great­est por­tion of part­ners would like SAP to sim­pli­fy the process and reduce the cost. For exam­ple, SAP could pro­vide dis­counts if part­ners agreed to cer­ti­fy on cer­tain ver­sions that it knows a lot of cus­tomers are plan­ning to adopt. Process improve­ments, such as detailed doc­u­men­ta­tion and ear­ly access to SAP S/4HANA releas­es, could also help incen­tivize part­ners to keep up with certifications. 

What’s Next for SAP S/4HANA Certifications

Now that we’ve dis­cov­ered what’s behind this issue, ASUG wants to help both cus­tomers and part­ners resolve it. But as Ron Gilson said, there’s no sil­ver bul­let yet. We’ve shared our research with SAP and are active­ly dis­cussing how we can work togeth­er to improve the cer­ti­fi­ca­tion process for all involved. We’re also reach­ing out to more live SAP S/4HANA cus­tomers like John­sonville to learn more about their needs as they con­tin­ue to build on their ERP sys­tems. Keep an eye out for more pro­gram­ming to come, includ­ing a track for live SAP S/4HANA cus­tomers at ASUG Annu­al Con­fer­ence in May 2020. 

Are you live on SAP S/4HANA and will­ing to share your expe­ri­ences with your peers? Please fill out this ques­tion­naire and tell us about what you’ve encoun­tered so far. We just may fea­ture your sto­ry (either anony­mous­ly or pub­licly) in an ASUG arti­cle. And if you’re attend­ing ASUG Annu­al Con­fer­ence, join us for one of our Pre-Con­fer­ence Sem­i­nars with in-depth train­ing for cus­tomers who are live or plan­ning to go live on SAP S/4HANA.