DSAG Investment Report 2023: Higher IT budgets and more SAP S/4HANA

The annual investment report of the German-speaking SAP User Group (DSAG) determines how companies’ spending on IT is developing. The result of the current survey: In 54% of the companies, the general IT budget is higher than last year and 52% report increasing SAP budgets. At 26% and 31%, respectively, spending remains unchanged from last year, while 15% each report declining budgets for IT overall and for SAP solutions in particular.

Make SAP S/4HANA the heart of your digital transformation

“Upward trend continues”

“The upward trend in IT budgets as well as budgets for SAP solutions, which was already evident last year, continues at roughly the same level. This speaks for confidence among companies that crisis situations will be managed well,” says DSAG Board Chairman Jens Hungershausen. “In addition, some established SAP solutions are coming out of maintenance soon, and companies’ project pipelines are well filled – budget is needed accordingly.”

Among the overarching topics that have relevance for investment planning, cyber security is the undisputed number one. 88% of companies attach high or medium relevance to the topic. Process automation enjoys medium to high relevance among 68% of respondents.

Majority lag behind in digitization

The DSAG Investment Report also examines how far companies have come in terms of digital transformation. While 44% say they are “very far” or “far”, 52% say they are “not very far” in digitization. DSAG’s explanatory approach: due to the uncertainties of the pandemic, companies have set other priorities in recent years and postponed planned digitization projects.

SAP ERP is most widespread

When asked which ERP system DSAG member companies use, SAP ERP or SAP Business Suite is the clear frontrunner (79%). SAP S/4HANA on-premise follows in second place (41%). Compared to the previous survey, the score for SAP S/4HANA on-premise has increased by 9%. The cloud variant of SAP S/4HANA is used by 11% of companies, with 8% relying on the private cloud and 3% on the public cloud.

The introduction of SAP S/4HANA is a mammoth task, because ideally not only is new software being implemented, but processes are also being optimized and master data cleaned up in the same course. With the end of maintenance for SAP Business Suite approaching in 2027 or 2030, it is imperative that SAP user companies address the implementation of SAP S/4HANA in the near future. Accordingly, 28% are planning high investments and 38% medium investments in SAP S/4HANA, according to the DSAG Investment Report.

Spending on SAP BTP on the rise

SAP Business Technology Platform (BTP) also plays a central role in SAP’s strategy – and especially in interaction with SAP S/4HANA. 24% of companies state that they will make high or medium investments in SAP BTP. The expenditure is distributed across the areas of database and data management as well as analytics (38%), application development and automation (17%), integration (17%) and artificial intelligence (3%).

These figures prove that data and its analysis are the basic prerequisite for being able to act agilely in times of high change dynamics. Companies are increasingly recognizing the need to position themselves for the future in this regard. The new SAP Datasphere solution as the successor to SAP Data Warehouse Cloud also fits into this context. SAP Datasphere is designed to make it easier for business customers to process and analyze business-critical information.

SAP’s cloud pricing policy generates displeasure

Many companies express dissatisfaction with SAP’s pricing policy in the cloud environment in the DSAG Investment Report 2023. Almost half are “dissatisfied” (32%) or “very dissatisfied” (17%) with this. DSAG calls for reliable mechanisms for price development and argues that an annually recurring increase in prices makes it more difficult for companies to move to the cloud. Satisfaction with SAP’s strategy for various industries also has room for improvement. 23% say they are “dissatisfied”, 10% are even “very dissatisfied”. The greatest dissatisfaction is in the healthcare sector, the metal, wood and paper industry, and the chemical industry.