How Many Customers on S/4?
SAP Isn’t Saying


1/31/2019

by Michael Pearson

SAP announced financial results for Q4 yesterday, and in a departure from recent norms, is not saying how many customers are live on S/4HANA.

The press release and management discussion did announce that there were 1,000 new S/4HANA customers in the fourth quarter of 2018, and that about 40% of these were net-new customers. So about 600 existing customers worldwide purchased the S/4HANA add-on.

So why the secrecy around “How many customers are live on S/4HANA?”.

Perhaps part of the reason might be that SAP doesn’t consider the metric itself to be useful or relevant.

The last publicly published number of customers live on S/4HANA was in October 2018, when SAP announced it’s Q3 results. The number give was 2,100 customers running live and in production on S/4HANA. This was out of a total of 9,500 customers who had acquired a license to run S/4HANA at that time.

When SAP announced “Shell went live on S/4HANA Cloud” does that mean that Shell no longer runs ECC? They run their entire business on S/4HANA? Probably not. It’s a misleading statistic to count Shell as a customer running S/4HANA when probably 99% of their ERP is still on ECC.

The number of customers “live on S/4” as a percentage of the number of ECC/ERP customers does not necessarily give the true conversion rate of customers to S/4. Assuming the number of customers live on S/4 worldwide is about 3,000 now (up from the 2,100 announced in October), this would be roughly about 5% of all SAP ERP customers worldwide.

However, if you consider the metric in terms of workload, the percentage of S/4HANA would be far lower.

Now, almost four years after the announcement of S/4HANA, there is still an adoption rate in the low single digits. Unquestionably this rate will start to rise dramatically. It will have to, as companies running SAP look to migrate before the end of support for ECC in 2025.



Author

About the Author: Michael Pearson

Michael is President of CONTAX and claims to be one of the few people in the western world who understands SAP licensing.