A report by American technological research firm Gartner has highlighted the fantastic recent growth of SAP S/4HANA around the world, as more and more companies begin to implement the software suite or ramp up transformations that are already in progress. The market is now estimated to be worth a whopping $30 billion and experienced year-on-year growth of 22.7% between 2021 and 2022.
Furthermore, Gartner suggests that this upturn will continue at pace over the coming years thanks to an impressive Compound Annual Growth Rate of 6.8%.
What Is SAP S/4HANA?
In a nutshell, the S/4HANA software suite aims to bring reporting from multiple business functions into one manageable view. That means companies can see real-time data from all of their core processes in one system without having to log in to multiple systems separately.
One of the most obvious benefits is that S/4HANA is designed to be customisable, allowing business owners to add and remove certain functions that are or are not relevant. So, all data points needed for effective resource planning are collated within a single set-up, whether it is finances, HR or client relations.
What’s Behind The Rise?
Rather fittingly, one of the key reasons for the growth in this industry is a product offering known as RISE with SAP. Whilst similar programs like GROW with SAP concern themselves with helping small or medium-sized businesses adopt the software, RISE with SAP targets large brands to provide them with a service that requires just one price, one licence and one contract.
More specifically, RISE with SAP has made it much easier for big businesses to smoothly adopt hyperscalers like Amazon Web Services (AWS) and Microsoft Azure, prompting more of them to choose this solution over their existing infrastructure or other cloud hosting options. In 2022 alone, RISE with SAP projects accounted for 36% of all upgrade schemes in progress.
Who’s At The Forefront Of The Rise?
Spearheading the growth at the forefront of the market are four giants in the form of Accenture, Deloitte, IBM and TCS. Combined, these companies make up 52% of the SAP S/4HANA revenue earned by the top 20 vendors featured in the study. Current projects are split into those that represent implementation and those focussing on application management, with the top four mentioned here all choosing a schedule that includes around 75-80% tipped in favour of implementation.
Whilst these behemoths of business dominate North America in terms of SAP S/4HANA adoption, there are interesting stories in other continents too. The fastest-growing region is actually Latin America, where IT services company DXT gatecrashs the top four revenue builders. Similarly, in the EMEA region, which is home to the largest vendor revenue (£11,786,000), it is business transformation specialist Capgemini that joins the most prominent players.
Why Is The Growth Likely To Continue?
Gartner forecasts that the next five years will see an average CAGR of 6.8%, made up of a projected 7.3% CAGR for implementation and 5.7% for management. The biggest reason for this is expected migrations from older versions of S/4HANA, including about 5,000 customers moving from the 1709 release to 2020 and around 3,000 customers upgrading from version 2021 to 2022 between the years 2026 and 2027. That is all on top of almost 1,300 legacy customers and an anticipated 1,500 new users coming on board each year up until 2030.
All of this proves the SAP S/4HANA market is clearly on an upward trajectory and shows no signs of slowing down. Whilst RISE with SAP is the biggest reason for new users signing up, the top end of the market is very concentrated, with 85% of the revenue being made up by the top 10 vendors. Finally, a wave of migrations and upgrades over the next five years will see the market continuing to expand at a Compound Annual Growth Rate of 6.8%
Why Talent Is Key
As S/4HANA continues to grow, so does the need for experienced SAP professionals. The complexities of implementing and managing S/4HANA require specialist talent, particularly as businesses migrate to cloud-based infrastructure. So, regardless of whether you’re implementing a new system or managing an upgrade, having the right SAP professionals in place can make or break the success of a project.
Given that the top 10 vendors account for 85% of the S/4HANA revenue, competition for talent is fierce. Partnering with Whitehall ensures that your business is connected to the best SAP consultant in the market, providing you with the expertise you need to drive successful S/4HANA implementations and upgrades.
S/4HANA Transformation with Whitehall
As the SAP S/4HANA market continues its rapid growth, now is the time to ensure your business has the right talent to succeed. Whether you’re beginning a new implementation or upgrading to the latest version, securing experienced consultants will be essential for a smooth and efficient process.
Whitehall Resources specialises in SAP recruitment, helping businesses find the expertise they need to stay competitive. Contact us today to discuss how we can help your organisation navigate SAP S/4HANA.
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